U.S. electric utility R&D spending turns positive

Littleton, Colo.

After a six-year decline, U.S. electric IOUs have demonstrated a return to positive growth in their annual research and development (R&D) expenditures. This is a major conclusion by TECC Group Inc. (TECC) based on its year 2000 analysis of U.S. electric IOU R&D spending. TECC annually reports on R&D activity in the electric power industry.

TECC studies showed an increase between 1999 and 2000 in the number of U.S. IOUs spending in excess of $100,000 per year for regulated R&D activities. The number of utilities operating at this level increased from 75 to 85 (+13.3 percent) and their total spending for R&D increased from $196 million to $213 million. The average level of R&D expenditure in 2000 was $2.5 million per utility.

Based on the TECC analysis and report, the top 10 U.S. electric IOUs in R&D activity for the year 2000 based on total R&D expenditures (internal and external) included:

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The TECC R&D report also presents seven comparable R&D statistics or metrics for relative comparisons between reporting utilities. One of these comparison metrics is R&D expense per electric customer. Based on this metric, the top 10 U.S. electric IOUs for the year 2000 are as follows:

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These results are from the 15th edition of the recently published annual TECC report U.S. Electric IOU Research & Development Expense Comparisons 2000. Other comparison metrics in the report include R&D$/electric revenue$, R&D$/electric operating income$, R&D$/electric department employees, R&D$/MWH sales, R&D$/MWH net generation and R&D$/total plant in service$.

“This is the first significant increase in IOU electric utility R&D spending since 1994,” said TECC VP, Steve England. “While this does not define a long-term trend, it does signal a very positive change.”

This report is available directly from TECC, a re-search, consulting and publishing firm serving the utility industry since 1983. Utility performance reports have been published since 1986. TECC annually publishes benchmark and comparison “cost of operations” reports covering U.S. electric and LDC utilities. More information can be found at http://home.earthlink.net/~tecc or by calling 303-973-1777.

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