http://www.consultrci.com

************************************************************************

Search SCIENTECH's PowerHitter archive to read about our interview with
a leader in the industy:
http://www.consultrci.com/web/infostore.nsf/Products/PowerHitter
************************************************************************
===============================================================
SCIENTECH IssueAlert, October 27, 2000
Toronto Hydro, Ontario Power Generation Launch EBT Express
By: Will McNamara, Director, Electric Industry Analysis
===============================================================

Toronto Hydro Corporation and Ontario Power Generation announced that they
have launched an electronic business transaction (EBT) "hub" that will
provide centralized electronic data management and transaction services
to local distribution companies (LDCs) and energy retailers in Ontario.
Called EBT Express, the exchange will become operational when Ontario's
new competitive electricity market opens next spring. Excelergy eXACTv,
developed by energy software solutions company Excelergy Corporation, will
provide the technology infrastructure for EBT Express.

ANALYSIS: This is a significant development, as EBT Express represents
the first hub in Canada for retail energy transactions. The site will serve
as the central clearinghouse for immediate communication of customer data
among hundreds of LDCs and energy retailers in Ontario, and possibly 
throughout
Canada.  I spoke yesterday afternoon with George Caraghiaur, Exelergy's
vice president, Canada, about EBT Express. Caraghiaur believes that the
site "will provide the essential technology for opening Ontario's electricity
market in an efficient manner." That is no small undertaking as there are
an expected 300 players that will need to communicate with each other in
Ontario once competition begins.

Deregulation is happening in Canada on a province-by-province basis (much
like it is happening state-by-state in the U.S.). Thus far, only Ontario
and Alberta have set dates when electric customers will be able to select
a new energy supplier. Ontario is scheduled to become competitive next
spring, and presently is the only region in which EBT Express will be 
operational.
Alberta uses a point-to-point transaction process, which represents a very
complex model. Caraghiaur believes that the value of EBT Express will be
clearly seen, and there will be many opportunities for the hub in Alberta
and elsewhere.

The Ontario Energy Board (OEB), which is the equivalent of a state PUC,
mandated the use of electronic business transactions (EBTs). The EBTs work
as follows: Once a customer selects a new energy supplier, the energy supplier
and the local distribution company (LDC) must continue to share information
about that customer. This proprietary data, shared strictly on a one-to-one
basis between the energy supplier and the LDC only, will include billing,
usage and payment information. Essentially, an LDC will read the meter
and send usage information to the energy supplier, who will calculate its
portion of a customer's bill and in turn send this data back to the LDC,
which will submit the customer bill. This represents a common way for billing
in Ontario, although there are other options including consolidated billing
that originates from the energy supplier and split billing coming from
both the LDC and energy supplier. No customer information will be exchanged
until competition officially begins in Ontario, which now appears to be
in the spring of 2001, although the technology infrastructure supplied
by Excelergy is already in place.

In response to the OEB's mandate, Toronto Hydro Corp. and Ontario Power
Generation*the largest players in electricity distribution and generation
in Ontario* became equity partners in the $7.7 million joint venture to
create EBT Express. All customer data will be contained within EBT Express,
which is supported by the eXACT technology. Excelergy eXACT is a software
solution that translates, validates, manages and delivers data exchanged
among users. The functionality of eXACT has been used in several U.S. states,
including Pennsylvania and New Jersey. In fact, eXACT was introduced to
gas and electricity retailers in the United States in 1999 as a component
of Excelergy ABPv, a billing and customer information solution. Allegheny
Energy Supply, a subsidiary of Allegheny Energy, was one U.S. utility that
I know of that used the Excelergy technology.

Caraghiaur contends that EBT Express will play an important role in enhancing
the competitive market in Ontario. "There are presently 37 licensed retailers
in Ontario, 15 pending retailers and 246 LDCs," Caraghiaur told me. "You
can imagine the cloud of communication pathways that would occur between
all these players without a centralized hub such as EBT Express." The number
of LDCs seemed awfully high to me, but Caraghiaur explained that in Ontario
many LDCs serve only a small number of customers, often 100 customers or
less. This should change as consolidation reduces the number of LDCs in
Ontario but, when compared to the United States, Ontario still will have
a comparatively high number of distribution companies.

Caraghiaur cited Pennsylvania as an example of a market that has tried
to assimilate communication among many market participants. Pennsylvania,
along with most other U.S. states, still uses electronic data interchange
(EDI) as its standard, wherein every LDC has a slightly different 
interpretation
of data that is shared through the EDI. This can often cause communication
inconsistencies and retailers may have a difficult time in getting ready
for deregulation. "EBT Express will be in the position to enforce standards,"
says Caraghiaur. "The use of XML in particular will enhance communication
between market participants."

In fact, XML (extensible market language) is the cornerstone of eXACT as
it constructs a standardized language so that data can be exchanged but
still understood by different applications. Caraghiaur claims that Excelergy
is on the forefront of XML technology, which was expressly stipulated in
the EBT standards developed by the Advisory Committee to the Ontario Energy
Board. XML is a common language used on the Internet that makes it easier
and more cost-effective for buyers and sellers to exchange data between
applications and data sources that otherwise might have been incompatible.
In addition, Excelergy's eXACT software is object-oriented, allowing for
easy and rapid change from one program to another.

Clearinghouse exchanges are definitely a trend in the energy industry.
Whereas states that previously deregulated, such as California and 
Pennsylvania,
did not use a centralized clearinghouse for customer information, states
and provinces now formulating their restructuring plans often mandate them.
For instance, Excelergy's competitor Logica has a market data clearinghouse
built for the Midwest market. Also, the ERCOT-ISO has teamed with Andersen
Consulting on a similar market data clearinghouse for the Texas unbundling,
scheduled for pilot in the summer of 2001 and full market opening in January
2002.

One concern that market participants may have is the sharing of customer
data through EBT Express, especially when it is backed by potential 
competitors
in the Ontario market such as Toronto Hydro and Ontario Power. Caraghiaur
responded to this by saying that the OEB mandated the exchange of customer
information through an EBT structure. However, market participants are
not mandated to participate in EBT Express. They could opt to still exchange
information on a point-to-point basis, although Caraghiaur believes that
EBT Express offers a much more efficient forum for the transfer of customer
data. In addition, Caraghiaur reiterated that no proprietary or competitive
information would be accessible between any parties other than the LDC
and energy supplier involved in the exchange.

Interestingly, Toronto Hydro and Ontario Power may be competitors when
the Ontario market opens next year. Toronto Hydro Corp. owns Toronto 
Hydro-Electric
System Limited, a regulated electricity distribution system, and Toronto
Hydro Energy Services, a competitive energy service company. Ontario Power
Generation is an electricity generating company, so Toronto Hydro and Ontario
Power will be competing on the retail level to acquire energy supply contracts
with lucrative customers. And rumor has it that venerable retail giant
Sears is also taking a look into becoming an energy retailer in Canada
next year. As Canada continues to deregulate and attract energy suppliers,
Excelergy anticipates that the EBT Express could serve a national market.

===============================================================
For a an in-depth perspective on the market potential of distributed 
technologies,
SCIENTECH is offering Stephens Inc.'s (Investment Banker) 97-page report,

"Powering the Digital Economy" on its Website at:
http://www.consultrci.com/web/infostore.nsf/Product-Preview/UtilityAdvisor

free for a limited time only.
===============================================================

SCIENTECH is pleased to provide you with your free, daily IssueAlert. Let
us know if we can help you with in-depth analyses or any other SCIENTECH
information products. If you would like to refer a colleague to receive
our free, daily IssueAlerts, please reply to this email and include their
full name and email address or register directly at:

http://www.consultrci.com/web/infostore.nsf/Products/IssueAlert


Sincerely,

Will McNamara
Director, Electric Industry Analysis
wmcnamara@scientech.com
===============================================================
Feedback regarding SCIENTECH's IssueAlert should be sent to 
wmcnamara@scientech.com
===============================================================

SCIENTECH's IssueAlerts are compiled based on independent analysis by 
SCIENTECH
consultants.  The opinions expressed in SCIENTECH's IssueAlerts are not
intended to predict financial performance of companies discussed or to
be the basis for investment decisions of any kind.  SCIENTECH's sole purpose
in publishing its IssueAlerts is to offer an independent perspective regarding
the key events occurring in the energy industry, based on its long-standing
reputation as an expert on energy and telecommunications issues.

Copyright 2000.  SCIENTECH, Inc.

If you do not wish to receive any further IssueAlerts from SCIENTECH, please
reply to this message and in the body of the email type "remove."