Thursday 04 November 1999
The truism that water and electricity do not mix has been borne out by the share prices of the multi-utilities over the past 12 months. While ScottishPower may not be in as bad a shape as, say, Hyder, things are clearly not that good either.
It does not take much reading between the lines of yesterday's interim results statement to see that it is stuck between a rock and a hard place - either a dividend cut or an appeal to the Competition Commission with no guarantee of success.
ScottishPower is juggling with three electricity and one water price reviews which in itself represents a huge drain on management time. Of the four, the one it seems most bruised about is Ian Byatt's proposal that Southern Water slash its prices by pounds 70m next year, most of which will be reflected in lower profits.
The two Ians who run ScottishPower, Robinson and Russell, still think the other Ian will change his mind but the chances of that are slim.
Perversely, the response of ScottishPower shares yesterday was to rise strongly. That, however, had more to do with the market's perception that the Scots' pounds 4bn takeover of the US utility, PacifiCorp, is finally about to happen a year after the deal was first unveiled.
ScottishPower has been warming up the analysts by pointing to the price increases and cost savings it can look forward to in PacifiCorp's West Coast markets once the deal goes through.
But if ScottishPower's experience here teaches us anything, it is that the regulatory vice is only ever turned in one direction. The Scots think they can show the Yanks a thing or two about how to run utilities.
But the US regulators are also taking a lesson or two from their UK counterparts by moving away from profit capping and towards incentive regulation. ScottishPower's regulatory risk can only multiple even further.
Notes from a small island: Is Sealand an independent 'micronation' or an illegal fortress?
Justin Bieber's unfinished monkey business
World news in pictures
David Cameron goes to war with press over 'swivel-eyed loons' slur
Revealed: Eerie new images show forgotten French apartment that was abandoned at the outbreak of World War II and left untouched for 70 years
- 1 Tears and cheers as David Beckham ends glittering career after helping PSG to final win
- 2 Heading for America? Prepare for the longest US immigration queues ever
- 3 You thought Ryanair's attendants had it bad? Wait 'til you hear about their pilots
- 4 David Cameron goes to war with press over 'swivel-eyed loons' slur
- 5 It’s official: thanks to Stephen Hawking's Israel boycott, anti-Semitism is no more
BMF is the UK’s biggest and best loved outdoor fitness classes
Find out what The Independent's resident travel expert has to say about one of the most beautiful small cities in the world
Win anything from gadgets to five-star holidays on our competitions and offers page.
iJobs Money & Business
£550 - £600 per day: Orgtel: Fidessa Analyst / PM - Banking - London - Up to £...
£450 - £500 per day: Orgtel: Sourcing Manager - Banking - London - Up to £500p...
To be discussed at interview.: Queen Elizabeth's School: An experienced and ef...
£294.05 - £330.92 per day + 150 per day travel and accommodation: Orgtel: A le...