Shopping credits, capacity rules and other mistakes from California and PJM.
With retail electric markets opening rapidly, why are so many getting off to a slow start? Why do suppliers abandon some markets and consumers decline to participate in others? The answer may lie in a series of disconnections between wholesale trading patterns and retail opportunities.
Bob Rowe of the Montana Public Service Commission was elected first vice president of the National Association of Regulatory Utility Commissioners. Rowe will continue to serve as chairman of the NARUC Telecommunications Committee for another year.
Duane, Morris & Heckscher LLP added Regina Speed-Bost to its energy group. Speed-Bost is the former legal advisor for natural gas and oil pipeline matters to William L. Massey, commissioner, Federal Energy Regulatory Commission.
Charles K.
The state foots the bill, while northern neighbors profit from a managed power market.
California's electric restructuring plan, launched on April 1, 1998, marks one of the most ambitious attempts in U.S. history to place the state in a social engineering role. Not only was the scale of the project daunting, with implementation cost estimates running as high as $1.2 billion, but the plan places California government in control of the most minute components of the electric system.
How has the experiment gone?
The numbers say "yes," adding weight to last year's benchmarking survey.
Does productive efficiency help determine an electric utility's prospects in regulated or competitive markets? Is productive efficiency a better marker of real-world success than simple financial attributes, such as cash flow, dividend ratio or operating income?
In unregulated markets, higher productivity translates directly into relative declines in costs and prices, and by extension, greater ability to compete and prosper.
The FERC didn't say, but honest lawyers want to know.
December was a grim month for those wanting the Federal Energy Regulatory Commission to further define the limits of a "sham transaction," as that idea is understood under the Federal Power Act, which dictates when an electric utility must offer transmission services to power producers, marketers or other utilities.fn1 Of the three cases concerning this issue that were pending before the FERC on the first day of the month, all were resolved. But none was explained.
One case was simply withdrawn.
Studies and Reports
Natural Gas Retail Choice. Utility affiliates hold large market shares in natural gas customer choice programs, raising questions about the extent of true competition, according to a study released on Dec. 15 by the U.S. General Accounting Office. Participation varies by region, however, according to the report, "Energy Deregulation - Status of Natural Gas Customer Choice Programs."
In Pennsylvania, for example, three out of four programs showed very high shares for utility affiliates. The Equitable Gas Co.
Hoecker, Trebing see advantages in economies of scale.
Will New York's proposed independent system operator fall victim to the FERC's evolving RTO process?
"It has some conceivable drawbacks," FERC Chairman James J. Hoecker told attendees at the 30th Annual Institute of Public Utilities Conference. "One is that it's a single-state ISO and in the final analysis, regional transmission organizations probably need to cover broader geographical areas."
Hoecker used the forum at the Dec.
Deregulation, you say? We still haven't seen any.
Let's begin with a quiz. We'll use the multiple-choice format, developed at the University of Wisconsin during the 1960s to address overcrowding caused by the World War II "baby boom." Choose only one of the following 10 possible answers. Be careful. It's tougher than it looks.
Question: What is meant by the term electric restructuring?
A. To provide all consumers with retail access to multiple "energy" providers.
B. To separate the ownership of power generation from other functions.
C.
Some see utilities fixing prices under competition. Really? I'm shocked.
Did you hear the one about the 10,000 percent rate increase? Ask FERC chairman James Hoecker or his colleague, Curt Hébert. They'd be happy to tell you. They don't even need their own joke writers. This story, you see, is absolutely true.
It seems that Virginia Electric & Power Co. wanted to squeeze just a little more profit from its Kerr-Henderson transmission line.
The post-mortems on last summer's price spikes in the Midwest are in. At least three studies of the event diverge in their conclusions:
First, on Sept. 24 of last year, the staff of the Federal Energy Regulatory Commission found the root cause of the spikes in extreme weather and unexpected outages. It observed no direct evidence of market manipulation and concluded that the events were unlikely to recur.