The future of transmission in North America: new transmission-only utilities challenge the status quo

摘要

DTE Energy, the parent company of Detroit Edison (Detroit, Michigan, U.S.), is getting out of the transmission business and, therefore, will no longer have control of the lines that transport power from its generating stations to its retail customers. In a sense, though, DTE was already losing the right to control power flows on its transmission lines. Nationwide, transmission owners are required to turn over the dispatch of generation and other wholesale transmission functions to independent system operators and regional transmission organizations. This course of action didn't fit the way DTE likes to transact business. Anthony F. Earley Jr., DTE Energy chairman and CEO puts it this way: "The current regulatory environment requires us to cede operational control of our transmission assets. Because we generate the greatest value for our shareholders and customers from assets we own and operate, transmission is no longer strategic to DTE Energy or a driver of future growth." Consequently, DTE put its transmission assets on the auction block. On Dec. 3, 2002, DTE agreed to sell its bulk transmission assets to KKR and Trimaran Capital Partners. When the deal closes, DTE will be USD610 million richer, but it will no longer own 3000 miles (4828 km) of high-voltage electric transmission lines and associated right-of-way. DTE will buy back transnussion services from the new owners and rates will be capped at current levels through 2005. With the proceeds, DTE intends to invest in its generation and distribution businesses, while strengthening its balance sheet. Sam Brothwell, director of utilities research for Merrill Lynch, predicts we won't see a mad rush for utilities to sell transmission assets to independent transmission companies until investors understand exactly how transmission will be regulated and, thus, how money can be made. Says Brothwell, "Investors want to know whether the states or the Federal Energy Regulatory Commission (FERC) will ultimately regulate the assets."