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The Changing Structure of the
Electric Power Industry 2000:
An Update


October 2000



Contents

Preface

Executive Summary

1. Introduction

2. Historical Overview of the Electric Power Industry

3. The U.S. Electric Power Industry Infrastructure: Functions and Components

Introduction
Generation
Transmission
Distribution
The Components of Electricity Supply - Utilities and Nonutilities

4. The Federal Statutory Background of the Electric Power Industry

Introduction
The Public Utility Holding Company Act of 1935
The Public Utility Regulatory Policies Act of 1978
The Energy Policy Act of 1992

5. Factors Underlying the Restructuring of the Electric Power Industry

Introduction
Price Differences
Technological Advances

6. Federal Legislative Initiatives

Introduction
Major Issues Under Debate
The Administration's Comprehensive Electricity Competition Proposal

7. Wholesale Power Markets and Restructuring the U.S. Power Transmission System

Introduction
FERC Promotes Wholesale Competition and Transmission Efficiency
Status of Regional Transmission Organizations
Wholesale Electricity Trading Hubs and Power Exchanges
Market Power In Wholesale Electricity Markets
Conclusion

8. The Role of the States in Promoting Competition

Case Studies

9. Mergers, Acquisitions, and Power Plant Divestitures of Investor-Owned Electric Utilities

Appendices

A. History of the U.S. Electric Power Industry, 1882-1991

B. Historical Chronology of Energy-Related Milestones, 1800-2000
    (Not available electronically)

C. Pending Federal Restructuring Legislation

D. Electric Power Industry Statistics

Tables

1. Percentage Change Between Various Electric Power Industry Statistics From The Great Depression Through World War II, 1932-1945

2. Major Characteristics of U.S. Electric Utilities by Type of Ownership, 1998

3. Number of Electric Utilities by Class of Ownership and NERC Region, 1998

4. Energy Supply Participants and Their Operations, 1998

5. Major Characteristics of U.S. Nonutilities by Type

6. Relative Size of Registered Holding Companies as of December 31, 1998

7. Total Projected Additions of Electricity Generating Capability for Electric Generators by Technology Type, 1999-2020

8. Proposed Legislation Influencing the Restructuring of the Electric Power Industry Introduced into the 106th Congress as of May 1, 2000

9. Overview of The Federal Energy Regulatory Commission's Efforts Promoting Competition in the Electric Power Industry

10. Companies Eligible to Sell Wholesale Power at Market-Based Rates, as of May 1, 2000

11. Major Provisions of FERC Order 888 on Open Access

12. Summary of Major Provisions of the Federal Energy Regulatory Commission's Order 2000 Final Rule Establishing Regional Transmission Organizations

13. Selected Information on Independent System Operators

14. Mergers and Acquisitions Between Investor-Owned Electric Utilities or Between Investor-Owned Electric Utilities and Independent Power Producers, 1992 Through April 2000

15. Comparison of the Number of Investor-Owned Electric Utilities Owning Generation Capacity, 1992 and 2000

16. Selected Mergers and Acquisitions Involving Investor-Owned Electric Utilities and Natural Gas Companies, 1997 Through April 2000

17. Overview of Strategic Benefits of a Combined Electric and Natural Gas Company

18. Government Agencies Responsible for Reviewing Mergers and Acquisitions Involving Electric Utilities

19. Status of Power Generation Asset Divestitures by Investor-Owned Electric Utilities, as of April 2000

B1. Historical Chronology of Energy-Related Milestones, 1800-2000
Not available electronically.

D1. Electric Power Industry Summary Statistics for the United States, 1998

Figures

1. Annual Statistics for the Total Electric Utility Industry, 1932-1980

2. Electric Power Supply Functions

3. Prime Movers of Electricity

Schematic of Generic Thermal Generator
Schematic of Gas Turbine
Schematic of Combined Cycle
Cogenration Schematic

4. Electric Power Industry Capability and Generation by Energy Source, 1998

5. Energy Sources for Electricity Generation by Region

6. Transmission Ownership in the United States

7. The Main Interconnections of the U.S. Electric Power Grid and the 10 North American Electric Reliability Council Regions

8. Electric Control Area Operators - Continental United States, 1998.

9. Service Areas for Investor-Owned Utilities, 1998

10. Service Areas of Federal Utilities, 1998

11. Publicly Owned Utilities in the United States, 1998

12. Service Areas of Cooperative Utilities, 1998

13. Shares of Nonutility Nameplate Capacity by Major Industry Group, 1998

14. Share of Utility and Nonutility Nameplate Capacity, Net Generation, Additions to Capacity, and Number of Units by Ownership Category, 1998

Nameplate Capacity
Net Generation
Additions to Capacity
Number of Units

15. Total Utility and Nonutility Nameplate Capacity, Net Generation, Additions to Capacity, and Number of Units by Ownership Category, 1992-1998

Nameplate Capacity
Net Generation
Additions to Capacity
Number of Units

16. Annual Growth Rate of Utility and Nonutility Nameplate Capacity, Net Generation, Additions to Capacity, and Number of Companies, 1992-1998

Nameplate Capacity
Net Generation
Additions to Capacity
Number of Units

17. Electric Utility Wholesale Power Purchases by Ownership Type, 1998

18. U.S. International Electricity Trade, 1985-1998

19. Sales to Ultimate Consumers by Sector, 1992 and 1998

20. Share of Sales to Ultimate Consumers by Sector, 1992 and 1998

21. Sales to Ultimate Consumers by Class of Ownership, 1992 and 1998

22. Share of Sales to Ultimate Consumers by Class of Ownership, 1992 and 1998

23. Status of State Electric Utility Deregulation Activity, as of July 2000

24. Average Revenue per Kilowatthour for All Sectors by State, 1998

25. Average Revenue per Kilowatthour for the Industrial Sector by State, 1998

26. Relative Average Revenue of Electricity Sales: Ratio of Industrial Consumers to All Consumers, 1960-1998

27. Independent System Operators and Regional Transmission Organizations in Operation or Under Discussion as of April 1, 2000

28. Major Wholesale Electricity Trading Hubs and Centralized Power Markets

29. Concentration of Ownership of Investor-Owned Utility Generating Capacity, 1992 and 2000

30. Cumulative Electricity Generation Capacity Additions Through 2020

31. Investor-Owned Electric Utility Generation Capacity Divested or to be Divested by Census Division, as of April 2000




Contacts


This report was prepared by the staff of the Electric Market Assessment Team, Electric Power Division, Office of Coal, Nuclear, Electric and Alternate Fuels, Energy Information Administration. Questions about this publication, as well as other energy inquiries, may be directed to the National Energy Information Center at (202) 586-8800 or via Internet e-mail at infoctr@eia.doe.gov. This report is accessible via the Internet at http://www.eia.doe.gov/cneaf/electricity/page/pubs.html.

General information regarding this publication may be obtained from Robert M. Schnapp, Director, Electric Power Division, by telephone at (202) 287-1903 or by Internet at robert.schnapp@eia.doe.gov, or from Dr. Suraj P. Kanhouwa, Chief, Electric Market Assessment Team, by telephone at (202) 287-1919 or by Internet at suraj.kanhouwa@eia.doe.gov. Specific questions regarding the preparation and content of this report should be directed to William D. Liggett, Project Manager, by telephone at (202) 287-1727 or by Internet at william.liggett@eia.doe.gov.

Editing and production assistance for this report was provided by Terry Varley, Sarah Loats, and Terri Thigpen.

Questions regarding specific chapters of the report should be directed as follows:

  Chapter Author Telephone Internet
Chapter 1 William D. Liggett (202) 287-1727 william.liggett@eia.doe.gov
Chapter 2 Rebecca A. McNerney (202) 287-1913 rebecca.mcnerney@eia.doe.gov
Chapter 3 Rebecca A. McNerney (202) 287-1913 rebecca.mcnerney@eia.doe.gov
Chapter 4 Rebecca A. McNerney (202) 287-1913 rebecca.mcnerney@eia.doe.gov
Chapter 5 Ronald S. Hankey (202) 287-1762 ronald.hankey@eia.doe.gov
Chapter 6 Rebecca A. McNerney (202) 287-1913 rebecca.mcnerney@eia.doe.gov
Chapter 7 William D. Liggett (202) 287-1727 william.liggett@eia.doe.gov
Chapter 8 Ronald S. Hankey (202) 287-1762 ronald.hankey@eia.doe.gov
Chapter 9 William D. Liggett (202) 287-1727 william.liggett@eia.doe.gov