February 11th, 1999

The Task Force (TF) reviewed and discussed the progress of other TFs as well as the Minutes of the January 27 meeting. TF representatives discussed Prof. Cannonís report on ROE and capital structure. TF members discussed the situation of utilities and the transitionís potential impact on utility rates and ownership. Some members estimated a potential distribution rate impact of 20 percent. Alternative adjustment mechanisms were discussed with respect to impacts, financial requirements, inter-utility equity and restructuring expectations. The Rate Adjustment Working Group (WG) reported on their progress. The WG noted the wide diversity across MEUs, lower costs do not necessarily equate with efficiency, inappropriate frameworks might induce inappropriate behavior, local distribution is a long term business, data reporting needs to be consistent, and the framework needs to be based on the Ontario experience. The TF discussed possible definitions of a large, medium and small utility. 


The Rate Adjustment Mechanisms working group will continue its review. The Groupings WG will begin their examination of possible approaches as soon as the survey data is collected and formatted. Both groups will report at the next TF meeting on their progress. 

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