New EIA report on Industry Mergers

Happy Holidays! See you in the next thousand years…

UFTO Note – New EIA report on Industry Mergers

An early Christmas present! This week’s issue of the ” Electric Utility Restructuring Weekly Update” arrived via email today, instead of Friday. (If you’re not a subscriber, I recommend signing up for it. It’s also available on the Internet at

This item caught my eye. It’s an impressive compilation of data on utility mergers. the Update’s writeup came from the Sustainable Energy Coalition “Weekly Update,” Dec. 19, 1999

In a report titled, “The Changing Structure of the Electric Power Industry, 1999: Mergers and Other Corporate Combinations,” the Energy Information Administration finds that competition is causing the number of mergers to increase rapidly. There have been twenty-two mergers completed by investor-owned utilities (IOUs) over the last three years and another twenty-five mergers will most likely be completed by the end of 2000. In addition, by the end of 2000, approximately fifty-one percent of all IOU power production will come from the ten largest IOUs. The twenty largest IOUs will have seventy-three percent of all IOU power generation capacity. Since 1997, IOUs have been divesting or have divested over 300 power plants, usually selling at prices that are 1.5 to 2.5 times their book value. Nuclear power plants have sold for far less than their book value.

The report can be retrieved [as a PDF file] at:

The complete executive summary from the report is included below.

The EIA has a wealth of information about the industry.
Home page:

One particularly interesting resource:
— Status of State Electric Utility Deregulation Activity Monthly
A map/chart of the status of deregulation activities by state.


The Changing Structure of the Electric Power Industry 1999:
Mergers and Other Corporate Combinations

December 1999

Executive Summary

Since the passage of the Energy Policy Act of 1992, which opened the U.S. electric power industry to the start of competition,1 investor-owned electric utilities (IOUs) have been under pressure to cut costs, to become more efficient, and to expand their products and services. Mergers, acquisitions, asset divestitures, and other forms of corporate combinations have become widespread as IOUs seek to improve their positions in the increasingly competitive electric power industry.

Since 1992 IOUs have been involved in 26 mergers, and an additional 16 mergers are pending approval. One effect of these mergers is that the industry is becoming more concentrated. In 1992 the 10 largest IOUs owned 36 percent of total IOU-held generation capacity, and the 20 largest IOUs owned 56 percent of IOU-held generation capacity (Figure ES1). By 2000, the 10 largest IOUs will own an estimated 51 percent of IOU-held generation capacity, and the 20 largest will own an estimated 73 percent.

Renewable Energy Annual 1997, Volume I

Renewable Energy Annual 1997
Volume I DOE/EIA-0603(97/1)

October 1997
Energy Information Administration
Office of Coal, Nuclear, Electric and Alternate Fuels
U.S. Department of Energy
Washington, DC 20585


Questions regarding specific information in the report should be directed as follows:

Renewable Data Overview:
Fred Mayes (202/426-1166,

Biomass Energy:
Robert Lowe (202/426-1171,

Municipal Solid Waste:
John Carlin (202/426-1146,
Geothermal Energy:
Jim Disbrow (202/426-1185,

Wind Energy:
Louise Guey-Lee (202/426-1143,

Solar Thermal and Photovoltaic:
Peter Holihan (202/426-1147

This report, the Renewable Energy Annual 1997, Volume 1, is the third in a series of annual reports published by the Energy Information Administration (EIA) to provide current information on renewable energy. In doing so, this report provides detailed explanations of summary renewable energy information originally published in EIA’s Annual Energy Review 1996, released in July 1997. It also constitutes an annual update of renewable energy data presented in the Renewable Energy Annual 1996.

The publication of this report marks a change in the publication format of the Renewable Energy Annual. The prior two issues contained both renewable data and analytical material. This year, EIA has split the Renewable Energy Annual into two volumes in order to make data available more quickly. Volume 1 includes renewable energy consumption, capacity, and generation data, along with brief descriptive text. It also includes a chapter on solar (thermal and photovoltaic) manufacturing activity, and an appendix on the direct uses of geothermal energy. It is expected that a later version of this report will include a feature article titled, “A View of the Forest Products Industry From a Wood Energy Perspective.” The Renewable Energy Annual 1997, Volume 2, a topical issues analysis report, is scheduled to be published in Spring 1998.

This report covers the following energy sources: biomass, geothermal, wind, and solar. While hydropower is a renewable energy resource, it is also regarded as a conventional energy source because it has furnished a significant amount of electricity for more than a century. Therefore, this report discusses hydropower as it contributes to total renewable energy consumption but does not address hydropower as an individual energy source. Also, EIA collects data only on terrestrial systems. Satellite and military applications are not included in this report. See Appendix A, “EIA Renewable Energy Data Sources,” and Appendix B, “Renewable Data Limitations,” for more detail.

New EIA reports

DOE Energy Information Admin issued two major reports yesterday

Electric Power Annual 1996
Renewable Energy Annual 1997

The first section of their “What’s New” webpage is shown below. The website provides links to summary, content, and pdf versions of each.

What’s New at EIA
**Electric Power Annual 1996 – Volume I (11/5/97) This report presents a summary of electric power industry statistics at national, regional, and State levels. The objective of the publication is to provide industry decisionmakers, government policy-makers, analysts, and the general public with data that may be used in understanding U.S. electricity markets. View an on-line summary of the publication. The data tables from this report are also available in ASCII format. This entire publication is also available for downloading as a PDF

Quarterly Coal Report – April-June (PDF – 1.5 MB) (11/5/97) This report provides comprehensive information about U.S. coal production, distribution, exports, imports, receipts, prices, consumption, and stocks. Coke production, consumption, distribution, imports, and exports data are also provided. View an on-line summary of the publication.

**Renewable Energy Annual 1997 – Volume 1 (11/03/97) This report presents the following information on the history, status, and prospects of renewable energy in the United States: historical renewable energy data; estimates of renewable resources; characterizations of renewable energy technologies; descriptions of industry infrastructures for individual technologies; evaluations of current market status; and assessments of near-term prospects for market growth. View an on-line summary of the publication. This entire publication is also available for downloading as a PDF

The Impact of Environmental Compliance Costs on U.S. Refining Profitability (10/30/97) Analysis of effects of environmental compliance costs on U.S. refining profitability in the 1990’s for major energy companies.

Special Report on China’s Energy Sector (10/28/97) As Chinese President Jiang Zemin visits the United States during the week of October 27, 1997, the U.S. Energy Information Administration is releasing an extensive report on China’s energy sector. Included are some charts which include energy forecasts for China as well as analysis on the structure of China’s energy sector. Also included are some charts forecasting China’s carbon emissions from energy sources.

Mitigating Greenhouse Gas Emissions: Voluntary Reporting (10/28/97) Results of the second year of the Voluntary Reporting of Greenhouse Gases Program.

Update — DOE Task Force on Electric Reliability; new EIA report

Subject: UFTO Note: Update — DOE Task Force on Electric Reliability; new EIA report
Date: Fri, 07 Feb 1997 13:00:12 -0800
From: Ed Beardsworth <>

| ** UFTO ** Edward Beardsworth ** Consultant
| 951 Lincoln Ave. tel 415-328-5670
| Palo Alto CA 94301-3041 fax 415-328-5675

Update — DOE Task Force on Electric Reliability; new EIA report

The minutes of the January 16 meeting should be made available soon, pending final OK by the task force chairman, Phil Sharp. They will be available on-line–I’ll let you know as soon as I hear from DOE.

Meanwhile, DOE staff are preparing some briefing papers for the Task Force members, and also plan to provide them with copies of a new report from the Energy Information Administration:

“The Changing Structure of the Electric Power Industry: An Update”, DOE/EIA-0562 (96), provides a good summary of the issues at stake and a history of the electric power industry.

It is available through the EIA at (202) 586-8800 (free to “energy producers”, but not to consultants!) or on their web site (http:// You can download the complete report (2.5 MB in pdf-Acrobat format), and a summary is available at:

Here are the first couple of paragraphs of that summary:

The Changing Structure of the Electric Power Industry: An Update

Electric utilities(1)–one of the largest remaining regulated industries in the United States–are in the process of transition to a competitive market. Traditionally vertically integrated,(2) the industry will in all probability be segmented at least functionally into its three component parts: generation, transmission, and distribution. The proposals and issues are being addressed in Federal and State legislation and are being debated in State regulatory hearings. (View a discription of utilities and nonutilities in the current market structure.)

Change is occurring through the issuance by the Federal Energy Regulatory Commission (FERC) of Orders 888 and 889 (dated April 24, 1996) to encourage wholesale competition. Order 888 addresses the issues of open access to the transmission network and stranded costs. Order 889 requires utilities to establish electronic systems to share information about available transmission capacity. In addition, as of June 30, 1996, 44 States and the District of Columbia (more than 88 percent of the Nation’s regulatory commissions) have started activities related to retail competition in one form or another.(3) Issues such as recovery of stranded costs, divestiture of transmission assets, increased mergers, renewable energy incentives, energy efficiency investments, reliability, and the timing of retail competition are critical due to the degree of importance electricity holds in this country’s economic and social well-being. Legislative proposals on electric power restructuring have been introduced into the U.S. House of Representatives and the U.S. Senate.