SoCalGas tells FERC: ''Transmission pricing matters!''.WASHINGTON--(BUSINESS WIRE)--Aug. 1, 1996--Packaging its key message into a sound bite sound bite n. A brief statement, as by a politician, taken from an audiotape or videotape and broadcast especially during a news report: "The box has been spitting forth maddening nine-second sound bites" , SoCalGas proclaimed to federal regulators Thursday that ``transmission pricing matters'' in a competitive electricity market and urged regulators to undertake a more exhaustive study of pricing issues through additional technical conferences. SoCalGas told the Federal Energy Regulatory Commission The Federal Energy Regulatory Commission (FERC) is the United States federal agency with jurisdiction over electricity sales, wholesale electric rates, hydroelectric licensing, natural gas pricing, and oil pipeline rates. (FERC FERC Federal Energy Regulatory Commission FERC FEMA Emergency Response Capability ) that it strongly supports moving forward with electric restructuring. ``Electric consumers should have the benefits of competition that natural-gas deregulation Deregulation The reduction or elimination of government power in a particular industry, usually enacted to create more competition within the industry. Notes: Traditional areas that have been deregulated are the telephone and airline industries. has brought to gas consumers,'' said Fred John, senior vice president of Pacific Enterprises, in his comments at the FERC's technical conference on transmission pricing. At the same time, ``How you price a key part of the delivered cost of electricity -- transmission service -- really does matter,'' said John, whose Los Angeles-based company is the parent of SoCalGas. ``In today's competitive gas market, buyers of gas look at the cost of gas supply, but they also look at the cost of its transportation arrangements. It's the delivered cost of energy that counts for the consumer.'' As the FERC moves forward in its efforts to restructure the electric business, it should look carefully at how transmission service is priced, John told the commissioners. Transmission pricing should be based on the principles of fairness and cost causation, he added, which in SoCalGas' view are synonymous and are part of the criteria that FERC's Transmission Pricing Policy Statement says will be used to evaluate pricing proposals. ``Customers should be charged based on the portion of the transmission system that is utilized,'' John pointed out. SoCalGas appeared before the FERC to oppose the transmission- pricing scheme filed at the commission by the Western Power Exchange (WEPEX WEPEX Weapons Exercise ), which includes the three investor-owned power utilities in California. WEPEX has proposed a single access fee -- paid by consumers -- to recover most of the transmission revenue requirement. SoCalGas, on the other hand, is proposing a two-part access fee -- to be shared by consumers and generators -- that differentiates between the local and regional functions of the WEPEX transmission system. ``It makes sense for consumers to pay for the reliability function of the transmission system,'' John told the FERC, ``but why should the consumer pay for the import function of the transmission system if the consumer is not purchasing any imported power?'' John acknowledged that SoCalGas' motivation on the pricing issue is to reduce the potential that gas-fired power generation in Southern California Southern California, also colloquially known as SoCal, is the southern portion of the U.S. state of California. Centered on the cities of Los Angeles and San Diego, Southern California is home to nearly 24 million people and is the nation's second most populated region, will be displaced by cheaper coal-fired generation outside the state. ``We want to ensure that gas-delivery facilities built for California consumers continue to be `used and useful,' that they not become stranded costs as a result of a particular electric- transmission pricing scheme.'' In contrast, John noted that Southern California Edison Southern California Edison (or SCE Corp), the largest subsidiary of Edison International (NYSE: EIX), is the primary electricity supply company for much of Southern California. It provides 11 million people with electricity. , a WEPEX member, can sell its local gas-fired generation plants and keep its remote generation facilities. They will receive stranded cost recovery of the depreciated Depreciated may refer to:
Splitting the transmission system into local and regional charges, and requiring generators to pay a portion of the regional rate reflecting the transmission facilities used, will ensure that the WEPEX utilities ``do not simply load unnecessary stranded costs upon consumers,'' John said. CONTACT: Southern California Gas This article or section needs sources or references that appear in reliable, third-party publications. Alone, primary sources and sources affiliated with the subject of this article are not sufficient for an accurate encyclopedia article. Co., Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. Mike Mizrahi, 213/244-2540 |
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