Manufacturing Industry
Kern River repeat?(Washington watch)
Underground Construction, January, 2007 by Barlas, Stephen
Pipelines, gas producers and electric generators all want the Federal Energy Regulatory Commission to reconsider its Oct. 19, 2006, decision in the Kern River rate case. The gas transmission industry was unhappy with FERC's decision to award Kern River a 11.2 percent return on equity (ROE) as part of a 2004 rate case for its expansion project. The pipeline industry felt that ROE, if it carries over to other rate cases, is insufficient to convince them to build new infrastructure.
Kern River itself entered the fray with a request for rehearing which argued that the 11.2 percent ROE, because of the complex peculiarities of the levelization formula used by FERC, will be "structurally unachievable." Instead, its ROE will end up at 9.88 percent.
The 11.2...
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