The "duty to connect" demands definition - such as the optimal investment in local wires, and who should pay for it.
As the electric utility industry continues its slow but inexorable transformation into a more "competitive" industry, there has been a notable absence of discussion concerning continued regulation of local distribution utilities, or discos.
New Mexico's PUC goes down in flames.
This story has everything: politics, favoritism, a stock price crash, extortion (a long-ago crime by a certifiable nut), a utility rate case (I love'em), Ivy League economists (like moths to a flame), and finally, a last minute stay of execution, perhaps saving the utility from default on its revolving line of credit. Heck, even Enron's involved.
What's missing, however, is a clear understanding of who the good guys are.
As utility takeovers break new ground, the FERC ponders proposed rules, perhaps already out of date.
A year ago, when U.S. Antitrust Czar Joel Klein talked of a "window of opportunity" for electric utility mergers, he didn't predict when it would close.
And it hasn't yet.
In the 12 months leading up to January 1998, when Klein had addressed the Federal Energy Regulatory Commission through its "Distinguished Speakers" series, only the ill-timed Primergy deal had been turned down. The next year, 1998, would prove no different.
Projects sprout in the United States and overseas, pushing the limits of grid capacity, turbine manufacturers and available sites.
Merchant power plants are emerging en masse to address the growing electricity needs of the United States and other countries, thanks to deregulation and fearless developers. While some plants are built to replace older, less-efficient utility-owned units, others would serve demand growth. Still more are planned as niche-oriented peakers - ready to supply the grid when marginal prices rise high enough. Ancillary services might offer another niche.
Public power is competitive power, and that keeps IOUs on their toes.
There they go again. You know who I mean, the critics who fear us in a competitive electric utility environment, or who oppose, for ideological reasons, government involvement in the power business.
Charles E. Bayless, in his article "Time's Up for Public Power" (Public Utilities Fortnightly, July 1, 1998), offered up just the latest of these below-the-belt blows.
It's tempting to respond in kind to these critics. Why? Because they torture the facts and distort the record.
Shaky merger policy finds the FERC at war with itself.
"IN HIS DELIGHTFUL ARTICLE, "THE FOLKLORE OF Deregulation," published this summer in the Yale Journal on Regulation, federal judge Richard Cudahy notes the ethereal nature of "virtual electricity." This new product, he explains,"exists only as a blip on a computer screen and will never give one a shock." "Reality," he notes, has "retreated to the money part of the system."
We could use a dose of that reality in looking at electric utility mergers.
States earmark millions to fund solar projects via system benefits charges.
Making solar power a realistic choice for electric consumers is a burgeoning issue for state utility regulators. As part of electric restructuring, regulators are trying to finance the costs of solar installations.
Key to delivering commercial, on-grid solar power to new markets are state efforts, partnered with other government and industry actions. So far, the system benefits charge, or SBC, is the primary short-term incentive to develop solar, wind, biomass and other renewable resources.
No clear consensus has emerged. Should regulators hold to a hard line?
Regulators have wrestled for decades with transactions between vertically integrated monopoly utilities and their corporate affiliates.
Most problems have usually involved a shifting of costs, risk, or profit, as when an electric utility buys coal from a subsidiary. On the telephone side, AT&T's equipment dealings with Western Electric and Bell Labs were always a worry for regulators.
Robert W. Shaw JR. IS A BETTING MAN. Shaw's Aretê Corp. venture capital fund has invested $100 million in energy technology. This year the Center Harbor, N.H., fund set aside $30 million to invest in micro-generation technologies. Already the fund has pumped hundreds of thousands of dollars into more than a half-dozen companies trying to develop microturbines, fuel cells and other promising small-scale generation.
"This is a hot corner," Shaw says.
Shaw bucks naysayers like Ralph Selvig of VentureOne Corp., a San Francisco firm that tracks the venture capital industry.
The California Power Exchange doesn't solicit separate bids for plant start-up, spinning reserve or base load operation. That can make spark spreads a bit misleading
IT SHOULD COME AS NO SURPRICE THAT THE PROSPECT OF electric competition has created a huge demand for price forecasting services. To their credit, the forecasters have obliged, supplying an abundance of tools and techniques. Do the forecasts serve the needs of those who would use them?
Some might wish to use a price forecast to assign a value to assets.