GridAmerica To Cease Operation

GridAmerica, the independent transmission company (ITC) based in Cleveland, Ohio, and managed by National Grid USA, will cease operations effective November 1, 2005. GridAmerica manages a specific set of transmission-related functions on behalf of its three participant companies Ameren, FirstEnergy, and Northern Indiana Public Service Company (NIPSCO).

Earlier this month, Ameren notified National Grid and its fellow GridAmerica participants that it will withdraw from GridAmerica effective November 1. National Grid, FirstEnergy, and NIPSCO evaluated GridAmerica's viability given the current industry environment, their respective long-term corporate strategies, and Ameren's departure, and ultimately agreed to cease operations also effective November 1.

Announcing the decision, Jeff Scott, chief operating officer, U.S. Transmission for National Grid said, "We are extremely proud of GridAmerica's performance and the contribution we made to the development of the Midwest electricity market." Scott continued, "Clearly we are disappointed, especially on behalf of the GridAmerica staff, not to be taking the ITC forward at this time. However, we continue to believe that the consolidation of transmission systems under independent ownership and management combined with aggregation of control areas is the best long term option for stimulating investment in the U.S. transmission system and improving the efficiency of electricity markets."

Scott and Masheed Rosenqvist, GridAmerica's chief operating officer, commended the GridAmerica staff for their hard work and dedication during GridAmerica's year-and-a-half of operations to date, and for breaking new ground in the industry. GridAmerica is the only ITC in the country that combines the transmission systems of multiple companies, performs some of the functions normally handled by a regional transmission organization, or RTO, and has a managing member (National Grid) deemed independent of any generation interests by the Federal Energy Regulatory Commission.

There are approximately 40 employees who work in GridAmerica's Cleveland offices. Rosenqvist said that every effort will be made during the coming months to help the staff find jobs within National Grid or elsewhere when GridAmerica ceases operations.

GridAmerica will continue to provide services to its three participant companies until November 1. After that, the functions performed by GridAmerica will be undertaken by the Midwest Independent Transmission System Operator, the RTO that oversees the area where GridAmerica operates.

"While GridAmerica may not be a platform for growth at the present time, it is very likely that ITC business model will yield opportunities for National Grid in the future," Scott commented. "We may well find that GridAmerica is simply an idea ahead of its time."

Source: GridAmerica