Edison Readies for Utilities Deregulation : Energy: Company will set up separate unit to operate its high-voltage transmission system.
In a move that anticipates deregulation of the state’s utilities, Southern California Edison Co. said Thursday that it will form a unit to run its transmission operation--the network of high-voltage power lines that carry bulk power from generating plants to central distribution points.
The move separates all aspects of Edison’s transmission system--operation, planning, financial and other functions--from the existing Edison unit that controls power plants.
“This is what every utility is going to have to do to be successful in a competitive environment,” said Steven M. Fetter, senior director of the global power group of Fitch Investors Service Inc. in New York. “It makes sense that Edison would be taking this step sooner rather than later.”
Though the state Public Utilities Commission has yet to settle on a final plan, it is already clear that the commissioners intend to regulate separately the major operating utility businesses: power plants, the transmission lines and the distribution system that delivers electricity to homes and businesses.
Vikram Budhraja, Edison senior vice president who will run the new unit, said the utility expects that the transmission segment of its business will eventually be regulated by the federal government and operated by an independent operating organization--something like air traffic controllers who schedule takeoffs and landings but don’t own the planes.
“The most important thing here is positioning for a competitive future, and we’ll be taking other steps down the road,” Budhraja said.
Toward Utility Rate Normalization, a consumer advocacy group based in San Francisco, has been an active observer of the state’s developing deregulation plans and has often been critical of electric utility moves as they position themselves for the new competition. But Michel P. Florio, a TURN senior attorney, called the Edison announcement “generally a move in the right direction.”
