PG&E

Some in California say they will pay double - once to the ISO, then again to the IOU.

What if power prices fall but the savings get eaten up by higher transmission rates? Let's say we unbundle the wires, but end up creating just another layer of costs? We pay the independent system operator (ISO) to run the grid, but the investor-owned utility (IOU) still owns the wires. It has its own costs to recover. So now we pay two bills, right?

The issue is troublesome for California's electric utilities and a quagmire for Pacific Gas & Electric Co. In a new tariff it filed on Nov.

Carmen Ana Cintron was named an administrative law judge at the Federal Energy Regulatory Commission. Cintron previously served as Hearing Office chief administrative law judge in the Office of Hearings and Appeals of the Social Security Administration in Chamblee, Ga.

Unicom Corp. appointed Elizabeth Anne "Betsy" Moler senior vice president for federal government affairs. Moler, an attorney in private practice in Washington, D.C., is a former FERC chair. Upon completion of Unicom's merger with PECO Energy, she will head the combined company's Washington office.

Nevada Gov.

Mergers & Acquisitions

Joint Ventures. The Federal Trade Commission, in consultation with the Antitrust Division of the U.S. Department of Justice, issued draft antitrust guidelines for "collaborations among competitors" that will apply to a wide range of joint ventures and strategic alliances other than actual mergers.

Such collaborations would include R&D efforts, information sharing and joint efforts in marketing, distribution, sales or purchasing, plus various types of trade association activities. File No. 971201, Oct. 1, 1999 (F.T.C.), published at 64 Fed. Reg.

An alternative measure of performance - not based on dividends, earnings growth or P/E ratios.

How to place a value on a utility company? That is the question.

The traditional models no longer work very well. Dividend discount models will not work well if utilities cut dividends and buy back stock to return capital to the shareholders. Earnings growth offers no reliable performance gauge either, as utilities acquire or divest large amounts of capital. Restructuring charges often become necessary to shift resources to their best use.

Five commission chairs from states in all phases of deregulation ponder their changing roles. Will market success make them obsolete?

As most state electric competition plans are implemented within the next few years, regulators face an uncertain future. And they're already reflecting on their role in a changing industry.

Regulatory commissions in both Illinois and California have created panels to discuss the issue and the National Association of Regulatory Utility Commissioners (NARUC) has held closed-door sessions on the subject.

Mergers & Acquisitions

CP&L + Florida Progress. Carolina Power & Light announced Aug. 23 that it would purchase Florida Progress Corp. for $5.3 billion in a combination that would create the nation's ninth-largest utility in terms of generating capacity, with $6.7 billion in annual revenues and 2.5 million customers in three states. CP&L would pay a premium (between 16.5 percent and 21 percent) over the pre-announcement share price of FP stock.

Commissioner Lauren "Bubba" McDonald of the Georgia Public Service Commission was appointed to a three-year term on the National Association of Regulatory Utility Commissioners' (NARUC) Committee on Electricity.

Peabody Group named Jiri Nemec, previously group executive of Northern Appalachian operations, group executive of Midwest operations. Nemec replaced Mathew A. Haaga, who resigned. James A. Beck Jr., previously group executive of Southern Appalachian operations, was appointed to oversee all of Peabody's Appalachian operations in West Virginia.

David W.

California again is the proving ground. Analysts see DG as the biggest issue since the PUC first mapped its "vision" for retail competition.

News Digest was compiled by Carl J. Levesque, editorial assistant, Lori A. Burkhart, contributing legal editor, and Bruce W. Radford, editor. For continual news updates, see www.pur.com.Nuclear Power

Transmission & ISOs

Transco Independence. Granting Entergy's request for a declaratory order, the Federal Energy Regulatory Commission ruled in a case of first impression that a stand-alone transmission company ("transco") would meet the test in Order 888 for independent system operators despite passive ownership by a power producer or other market participant.

The wires business goes up for grabs as California opens its landmark case on distributed generation.

Jay Morse has studied distributed generation for the past seven years. Today, as an engineer and policy analyst on regulatory transition and market development issues for the California PUC's Office of Ratepayer Advocates, he sits in the eye of the storm. Technology is busting out all over, says Morse, who calls himself the "godfather" of DG in California's electric restructuring.