McHUGH & ASSOCIATES

 

 

Home The Market Weekly Qualifications

                   ENERGY                SPECIFIC ENGAGEMENTS

The section below provides examples of relevant engagements performed by M&A and our Consultants.  As previously indicated, we have extensive qualifications and experience in the utility industry, particularly in market and financial analysis, risk assessment, pricing, and the regulation of utilities.

EXPERIENCE PROVIDING SERVICE TO UTILITIES

M&A’s extensive experience with utility companies includes the projects summarized below.  The following projects demonstrate our understanding and commitment to provide excellent professional counsel to the BPA.

Bonneville Power Administration 

Assisted the Bonneville Power Administration in administering its rate equalization program.  Identified regulatory and financial issues relating to public and private utilities program participation.   Analyzed economic, legal, and political factors.  Incorporated customer and party concerns to resolve complex program issues.  

Provided the economic and fiscal evaluation of the alternative proposal developed in the Regional Review regarding BPA’s structure and the regions electricity supply exposure to Endangered Species Act.  Developed the financial forecasting and simulation model used for the analysis of alternative proposals under the review and their effect on treasury repayment.   The model is capable of addressing issues such as alternative fish cost expenditures, energy pricing options and river operations.  

Quantified the potential stranded investment for BPA and every major West Coast investor owned utility.

Market Analysis 

Rate Case 

Provided the economic and financial assessment of the feasibility of BPA’s portion of the Third AC Transmission Line.  The analysis included the assessment of the Non-Federal participation  (Northwest Utilities). 

Provided the economic and financial assessment of the feasibility of the proposed inland intertie.    

Valuation & Summary of issues relevant to the potential sale of BPA 

Analysis of PGE’s rate spread methodology & marginal cost study 

Assisted the Transmission Business Line in developing revenue-forecasting system.  Specified business objectives and functional requirements for actual and forecasted revenue by product, customer, and contract.  

Directed the analysis and the negotiations of a long-term capacity and energy exchange contract, including transmission access. 

Trojan Decommissioning 

Developed and taught courses focused on customer load profiling, customer class definition, load research, demand forecasting, conservation program impacts and rate design. 

Quantified the benefits of Federal Tax Subsidies to IOU's. 

Provided a comprehensive analysis of BPA’s competitiveness in the current markets and its competitiveness in an open market environment. 

Analyzed West Coast investor own and generating publics regarding their competitiveness in the emerging open market.  

Analysis of California’s Restructuring 

Assisted BPA in the development of its Capital Budgeting process.  The engagement's requirements ranged from the assessment of alternative measurement techniques to the development of the process for project. 

Merger Analysis:     Analyzed the operational and financial effects of Northwest utility mergers.  Assessed competitive implications of the mergers on the West Coast electricity market and BPA. 

PacifiCorp/Utah Power

 Washington Water Power/Sierra Pacific

 PGE/Enron

Puget Sound Power & Light/Washington Natural Gas  

 Clark/Cogentrix:     Performed an analysis of the bids to supply electricity submitted to Clark County PUD.   Performed an extensive “post-mortem” review of the winning bid (Cogentrix) relative to BPA’s bid.   

Performed an analysis of the bids to supply electricity submitted to Snohomish County PUD in it attempt to bypass BPA.  

Provided the economic and financial assessment of the feasibility of BPA’s portion of the Third AC Transmission Line.  The analysis included the assessment of the Non-Federal participation  (Northwest Utilities). 

 Provided the economic and financial assessment of the feasibility of the proposed inland intertie. 

Reviewed and evaluated the Least Cost Plans of the major investor owned utilities in the Pacific Northwest. The evaluation is being used in the determination of the prudency of resource acquisition and the long-run cost and the financial effects of the resource acquisition. 

Identified and qualified environmental effects of alternative electricity generation or demand-side options. Analyzed how Federal and State regulatory agencies are requiring energy producer’s to internalize environmental effects. 

Developed an Energy System Strategic Planning and Optimizing Model. The model is a detailed simulation model capable of simulating the monthly and seasonal operation of the hydropower system and its interaction with the alternative generation and conservation components. The model also addresses economic dispatch, capacity expansion, financial and rates impact.  

Financial Benchmarking 

Transmission Costs  --  Calculation of estimated transmission Costs for selected IOU’s and public utilities 

California's Competitive Market Marginal Cost 

Privatization of BPA 

Developed the data base management system and utility financial forecasting model (TUFFS) utilized to forecast the financial condition for 108 public and 8 investor owned utilities. 

Directed the development of an Energy System Strategic Planning and Optimizing Model.  The model is a detailed simulation model capable of simulating the monthly and seasonal operation of the hydropower system and its interaction with the alternative generation and conservation components (in place and planned) of the power system given alternative forecasts of demand. The models also address economic dispatch, capacity expansion, financial and rate impact. The model operates at both monthly and annual levels for a 20-year time horizon.  

Margin Management 

Analyzed the impact of the proposed open access and the resulting market competition on BPA’s financial position. 

Chelan County PUD 

 Developed the computer models utilized by the PUD in its Capital Budgeting process. 

Provided the need for power analysis in the PUD’s 1996 $300 million bond refinancing. 

Developed a West Coast Energy Pricing Model to be utilized in the marketing of the PUD’s surplus energy 

Assisted in the development of budget preparation policies and procedures. 

Assisted in developing a five-year financial plan and supporting a computer model. 

Assisted in evaluating financing alternatives and development of a financing plan. 

Assisted in the development of budget preparation policies and procedures. 

Reviewed Chelan’s rate proposal, which included proposed revenue requirements (operating expenses, debt service coverage, etc. and rates.)  

Developed Option Pricing models (Hydro, Price, and Load Risk)

National Power Corporation (Philippines.)

Development of a Long Run Marginal Cost Study, including model development and technology transfer for each of NAPCOR three (3) major grids by customer class and voltage level.

Estimated the market prices that will emerge as competition is introduced in the Philippines development of transition pricing. 

 Development of transition pricing.

 New Zealand

 

Developed the analytical framework utilized in the valuation of New Zealand’s electricity generation resources.   These valuations are being used as the basis for the sale of ECNZ’s resources into the competitive market. 

Valuations used as the basis for the privatization of New Zealand’s electricity market and the sale of ECNZ’s resources into the competitive market.

 American Electric Power  (Australia) 

            Developed the analytical framework utilized in the bid preparation for the Yallourn coal fired generation facilities as part of the Australian privatization process.   

            Simulated the Australian electricity market and estimated the market clearing prices.

Philadelphia Electric Company

Analyzed of the economic and financial impact of the wholesale bypass of portions of Philadelphia Electric Company’s (PECO) service territory.  

Quantified and valued alternatives supply options. 

Assessed the costs of alternative suppliers and transmission access. 

Quantified PECO’s stranded investment.

 

Iowa Utility Board 

Developed the rules relating to expenditures in energy efficiency programs by rate-regulated public utilities. 

Developed the procedures used by the Board in the consideration of recovery of energy efficiency expenditures. 

Developed and taught courses focused on customer load profiling, customer class definition, load research, demand forecasting, conservation program impacts and rate design.

 

 Southern California Edison/ City of Vernon

 

Arbitrated an intertie access dispute.  

 Assessed alternative proposals concerning transmission access provisions.

 

Washington Public Power Supply System 

Conducted the Cost-Effectiveness Study (Least-Cost Plan) of (completing) Washington Public Power Supply System’s nuclear power plants WNP-1, WNP-2, and WNP-3.  

Estimated the (marginal) cost of completing the plants and compared them to all other generation/ conservation options available to the Pacific Northwest. 

Determined the environmental and social impacts of the construction and operation of the nuclear power plants compared to the alternatives.   

Northwest Energy Policy Project 

Developed an all-fuels econometric/end-use demand forecasting model for the Pacific Northwest as a whole, each of the states, and seven economic sub-regions. The expected future aggregate demand for total energy and each of the fuels was forecasted for each consuming sector (including agriculture and transportation). 

State of Idaho 

Developed the states energy models and assisted in the linkage of the energy model to a state economic activity model.

Estimated the impacts of economic growth and development policies on the expected future demand for energy resources. 

State of Alaska, Department of Commerce and Economic Development, Division of Energy and Power Development 

Developed Alaska’s Long-Term Energy Plan. 

Collected and verified regional end-use data bases, estimated an econometric end-use forecasting model, quantified conservation potential, examined alternative electric generation strategies (e.g., wind, geothermal, etc.), natural resource planning (financial and environmental aspects), and developed an energy emergency contingency plan. 

American Electric Power 

Analyzed the economic and financial effects of the accelerated extraction of coal and subsequent closure of a high sulfur coal mines.

Arizona Corporation Commission 

Coordinated the State of Arizona’s long-term demand forecast and analysis of the Pale Verde construction program.  

 

 

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