Subject areas
Bonneville subscription process /marketing plan
The Steering Committee that conducted the Comprehensive Review
recommended that Bonneville use a subscription process for its long-term
sales of electricity. The Pacific Northwest Utilities Conference Committee
(PNUCC) is coordinating discussions between Bonneville and its customers
to develop the subscription process. The group's workplan,
meeting schedules and summaries are available at the Bonneville web site.
The Transition Board will provide a forum for regular reporting by
Bonneville and its customers on progress in this development. It will also
provide a forum for comment by other interested parties on the direction
that development is taking. Based on demonstrated progress, the Transition
Board will evaluate the prospects for a successful subscription of
Bonneville's power.
Transmission
Open and equal access to the high-voltage transmission system is
essential for the establishment of a competitive wholesale market for
electricity. To ensure open and equal access, the Comprehensive Review's
Steering committee recommmended that the region's electrical transmission
facilities be controlled by an independent grid operator. The Transition
Board is monitoring the work to establish an Independent Grid Operator (IndeGO),
and is participating in the discussions of the IndeGO
States Task Force and the Northwest Region
Transmission Association. The Transition Board expects to have regular
briefings on the progress of this effort, with special focus on issues
raised by the participation in IndeGO of Bonneville, which owns the
largest share of the region's transmission.
The Steering Committee also recommended that Bonneville's transmission
and generation assets be legally separated, and that the BPA transmission
business be subject to FERC review equivalent to that applied to
jurisdictional utilities. The Transition Board has formed a work group to
explore the issues involved with such a separation. The work group is open
to all parties who are prepared to commit the time required (see the memo
to interested parties). The first meeting of the work group was held
April 1, 1997 at the Northwest Power Planning Council offices at 851 S.W.
6th Avenue, Portland. For a work plan, schedule, meeting summaries and
background material relating to this group, look here.
Consumer access
The Comprehensive Review resulted in a number of recommendations
relating to increased consumer access to alternative suppliers of
electricity. The Transition Board will communicate with state legislatures
and regulatory commissions the Comprehensive Review's recommendations
regarding consumer access. It will collect and summarize legislative
and executive/regulatory proposals and
make them available to interested parties on this web site and in print.
The Transition Board will analyze proposals for their consistency with the
Comprehensive Review's recommendations and for consistency among the
states. It will communicate the findings of this analysis to legislatures,
regulators and other regional interests. Finally, the Transition Board
will evaluate the results of pilot programs of consumer access, and
communicate these findings to all interested parties.
Public purposes
The Comprehensive Review's Steering Committee recommended minimum
levels of support for conservation, renewable energy and service to
low-income customers. The Transition Board will communicate with state
legislatures and regulatory commissions regarding the recommendations of
the Comprehensive Review on these public purposes. It will collect and
summarize legislative and executive/regulatory
actions and proposals and make them available to interested parties on
this web site and in print. The Transition Board will analyze proposals
for their consistency with the Comprehensive Review's recommendations and
for consistency among the states. It will communicate the findings of this
analysis to legislatures, regulators and other regional interests.
Legislative actions and proposals
Idaho
The Idaho legislature is adjourned. Before adjourning, it completed
action on several bills and resolutions related to electricity
restructuring.
- House concurrent resolution 2 established a joint legislative study
committee to review issues surrounding restructuring.
- HB 6 appropriated $100,000 for consultant's assistance for the
joint study committee.
- HB 381, which would unbundle bills and provide for customer choice,
stranded investment recovery and system benefits charges, was printed
and referred to the joint study committee.
- SB 1215, which would establish an Idaho Domestic and Rural Power
Authority to create an option to insure that the citizens of Idaho
benefit from the hydro resources of the Columbia River and its
tributaries, was also printed and referred to the joint study
committee.
- HB 399, which directs the Idaho Public Utility Commission to obtain
unbundled cost information from all Idaho utilities (both investor-
and customer-owned), analyze the information and provide the
information to the legislature and governor by July 1, 1997, was
adopted.
- Senate concurrent resolution 119, supports the efforts of Governor
Batt to preserve the low cost of hydroelectricity being generated in
Idaho for Idaho ratepayers, and supports the governor's appointment
of a committee to assist him. The committee could include the Attorney
General, the Director of the Department of Water Resources, the Public
Utilities Commissioners (or their designees), members of the
Legislature and other interested citizens.
Bill information and status can be found at www.state.id.us/legislat/track97.html.
Montana
On April 23rd, Governor Marc Racicot signed into law the
Northwest's first legislation that substantially restructures the
electric industry. The final version of SB 390, the "Electric Utility
Industry Restructuring and Consumer Choice Act" commits the state's
regulated utilities to full open access by no later than July 1, 2002.
Customers with loads of 1 MW or more must have access by July 1, 1998.
Utilities must implement pilot open access program for their residential
and small commercial customers by July 1, 1998 although the Montana PSC
has the ability to delay the implementation date for these smaller
customers for up to two years if the competitive market does not develop
or if there are practical feasibility or reliability problems.
Montana's new law mandates that 2.4 percent of each utility's 1995
retail sales revenues become the annual funding level for conservation,
renewables and low income energy assistance. This charge takes effect
January 1, 1999. Large customers with loads of 1 MW or larger will pay a
universal systems benefit charge equal to the lesser of $50,000 or 0.9
mills/kWh.
Also under the legislation, all customers of PSC-regulated utilities
will have the benefit of a rate freeze for two-years starting July 1,
1998. A second rate freeze will be imposed from 2000 to 2002 for
residential and small commercial customers since they are not guaranteed
open access until 2002. The cost to implement open access and cost of the
universal system benefits charge are exempted from these freezes.
The states? locally-regulated utilities (rural co-operatives) are
subject to provisions similar to the IOUs. However, they have one year
from the Act's adoption to give notice that they are exempting
themselves from the Act's provisions and restructuring altogether.
Transition costs (estimated by Montana Power to approximately $1
billion) are to be recovered through the issuance of "transition
bonds" once their amount (if any) has been approved by the Montana
PSC.
Click here to see a more detailed summary of
the features of this bill.
Bill information and status can be found at www.mt.gov/leg/branch/legis.htm.
Oregon
As of June 4th , the House Power Deregulation Committee was
still debating the merits of amending HR 2821 versus expanding or
modifying the scope of HR 2503 that would delay electric industry
restructuring until 1999 by creating a task force to study the issue.
Passage of a comprehensive restructuring bill this session seems very
unlikely since nearly all public utilities support a "study"
bill and both PacifiCorp and PGE disagree with some of the proposed
amendments.
In its current version HR 2821 would have mandated open retail access
for large customers by the end of 1999 and for all customers by October 1,
2001. In addition HR 2821 deregulates generation, establishes cost-based
rate-making for distribution and ancillary services, requires energy
service providers to offer "market-based index rates" and
reciprocity. It requires separation and unbundling of utility services and
state registration of non-utility service suppliers.
With respect to public purposes, HR 2821 would dedicate the equivalent
of 3% of retail electricity sales revenues to conservation, renewable
resources and low-income weatherization. These funds would be administered
by a board appointed by the governor.
HB 3283 has passed the House. Among other features, the bill drops the
"need for power" requirement for siting large energy facilities
and adopts a climate change standard for controlling greenhouse gasses.
Bill information and status can be found at www.leg.state.or.us/bills.html.
Washington
The Washington legislature, after much heated discussion, adjourned
without adopting any major restructuring legislation. Senate Substitute
Bill 6006 would have mandated customer choice by July 1, 1999. Small
public utilities with less than 25,000 meters or with densities of seven
or fewer customers per line mile were to be given until October 1, 2001 to
open their systems unless their governing body voted to open the system
sooner. SB6006 would have required reciprocity, registration of new
electricity suppliers, and imposed new consumer protection standards.
With respect to public purposes, SB6006 required the collection of a
conservation and renewable energy charge of 3% to be placed on the bills
of all consumers and specified how these funds were to be allocated. The
legislature was to evaluate the cost-effectiveness and need for
continuation of these funds by July 1, 2002. Funding was to sunset not
later that July 1, 2009.
Bill information and status can be found at www.leg.wa.gov/www/bills.htm.
Other States, Provinces
Both the Western
Interstate Energy Board (WIEB), and the British
Columbia Task Force on Electricity Market Reform, summarize
legislative developments in industry restructuring in the western U.S. and
Canada at their websites.
U.S. Congress
Six bills dealing with electric utility industry restructuring have
been introduced in the 1997-98 Congress. For more details about these
bills, go to National Electricity Restructuring
Legislation.
Murkowski Hearings: Senator Frank Murkowski, chairman of the
Senate Energy and Natural Resources Committee held three workshops on
electric industry restructuring, in March and April to attempt to answer
the following questions: What are the states doing to promote competition?
What are the impediments to competition? What role should public power
play in a competitive environment? What can Congress do? Murkowski's
goal is to assure all consumers of the lowest-priced electricity
consistent with reliable services. He has announced no plans to sponsor a
bill.
Bliley Hearings: Rep. Thomas Bliley (R-VA), chairman of the
House Commerce Committee announced on Sept. 4, 1996, that customer choice
in electricity would be his "singular priority" for the 1997
Congressional session. Bliley opposes single-purpose bills that would, for
example, repeal PUHCA or the mandatory power purchase provisions of PURPA.
Instead, Bliley supports comprehensive approaches such those proposed by
Schaefer, Markey, and Johnston. He held a series of six public hearings
"outside of the beltway" beginning in April.
The California House congressional delegation sent a letter to
Representative Bliley urging that the federal government let California's
new restructuring bill proceed without intervention. All 52 members signed
the letter which also stated "We believe that the decisions made in
California on utility restructuring and competition are the right ones for
our state and must have the opportunity to be fully implemented."
Executive/regulatory agencies
Idaho
Idaho Power Company has proposed to increase its monthly customer
charge to pay for its contribution to the Northwest Energy Efficiency
Alliance. The company says that this manner of collecting the charge will
have the least impact on their competitiveness.
Idaho Governor Phil Batt has created the Governor's Council on
Hydroelectric and River Resources, chaired by former U.S. Senator Jim
McClure. The purposes of the Council are: 1) to establish guidelines and
goals for the successful deregulation of the electricity industry; 2) to
recommend principles to govern power deregulation, river operations and
hydroelectric relicensing that protect water rights, fish and wildlife
habitat and recreational activities; and 3) to solicit ideas and
suggestions from a broad range of stakeholders. The Council will oversee
four committees, focusing on hydropower relicensing, electric industry
restructuring, river governance, and consumer and public purposes. See the
executive order creating the Council.
Montana
Governor Marc Racicot has issued a statement of
principles that he will use to judge legislation on utility industry
restructuring for his signature.
Oregon
Governor John Kitzhaber issued a "Statement
of Principles for Restructuring the Electric Utility Industry" on
December 12, 1996. These 11 principles outline his objectives for
restructuring. They address energy efficiency; renewable resources;
low-income weatherization and energy assistance; consumer protection;
stranded costs; reliability and competitive market issues.
The Oregon Public Utility Commission has concluded a series of
workshops on restructuring. The Commission will use the workshops to
identify issues that need to be addressed and may lead to further
investigation of specific issues. Portland General Electric has
established a retail access pilot for large customers and is designing one
for small customers this summer. PacifiCorp plans to operate a pilot for
large customers in Northern California, but hasn't released any plans for
Oregon.
The Oregon Office of Energy recently released a status report on the
weatherization of low-income housing in the state. The report includes
five recommendations to improve the state's low-income weatherization
programs. It also includes considerable data on the historical levels of
low income weatherization activity and the remaining potential need. The
report is available from the Oregon Office of Energy.
Washington
Governor Gary Locke issued a "Statement of
Principles for Restructuring the Electric Power Industry" on
March 25, 1997. The principles cover equity of access to service by all
consumers, equity of taxes and burden of stranded costs, local control of
consumer-owned utilities, support for efficiency and renewable energy, and
maintenance of the reliability of the system.
Federal Agencies
Nuclear Regulatory Commission: In September 1996, the NRC
published, for public comment, a draft policy statement on
"restructuring and economic regulation of the electric utility
industry." NRC is concerned over the anticipated desegregation of the
industry into separate companies which could affect the licensing basis
under which the NRC originally found a licensee to be financially
qualified to construct, operate or own its nuclear power plant. The draft
policy calls for adhering to a standard review plan which is under
development. The plan will address financial qualification,
decommissioning assurance, and antitrust issues. Comments on the draft
policy statement were due by February 7, 1997.
The Department of Justice: The DOJ Anti-Trust Division, warned
states to be careful in implementing their retail wheeling regulations so
that the complying utilities are not opened to anti-trust actions. DOJ's
Jade Eaton, addressing a conference in Washington, D.C. in March, stated
that "If a state institutes a retail competition program, it must say
explicitly how the program will be implemented, and must supervise the
implementation."
Links to ...
- IndeGO
- The independent grid operator proposed to operate the transmission
system of the Pacific Northwest, as well as Colorado, Wyoming, Utah
and Nevada. Twenty-one participants are developing the rules and
structure of the organization.
- IndeGO
State Task Force - A group of interested parties from utility
commissions and state agencies that is monitoring the development of
IndeGO and discussing policy issues related to the creation of an
independent grid operator.
- Northwest Regional
Transmission Association (NRTA) - NRTA is a voluntary organization
whose members include transmission providers and users, Canadian
transmission users and Northwest regulatory commissions. It was formed
to foster efficient, equitable and reliable use of existing and future
transmission facilities and the expeditious and fair resolution of
disputes related to transmission access. NRTA also provides a forum
for coordination of transmission planning.
^ top
|
home