Richard D. Farman is prepared to take advantage of California’s newly deregulated energy market.
Farman was recently promoted from president to chief executive of Pacific Enterprises, parent company of Southern California Gas Co. He replaces Willis B. Wood Jr., who remains the company’s chairman.
When the merger between Pacific Enterprises and Enova Corp., the parent of San Diego Gas & Electric Co., is completed, Farman will become the first chairman and CEO of Sempra Energy, the company that will be formed by the merger.
“The merger is a very logical response to the restructuring that is going on in the energy industry,” said Farman. “The new company will be able to achieve successes that neither company would have been able to achieve on its own. The merger will enable us to provide either electricity or natural gas, and we will start out in a very strong marketplace ? namely, Southern California ? with a customer base of 6 million.”
Although plans for the merger were announced in October 1996, the companies are still awaiting final approval from the Federal Energy Regulatory Commission and the Securities & Exchange Commission. They surpassed the first hurdle on March 26 by receiving approval from the California Public Utilities Commission.
Farman is hoping the merger will be completed by early July.
“This is a true merger of equals,” he said. “Even though the regulatory approval process has been long and occasionally frustrating, we have been able to move ahead with a joint venture called Separate Energy Solutions which will compete in unregulated markets. We have also acquired an energy trading company and a company which provides energy efficiency services. The regulatory approvals have been long, but they haven’t kept us out of the marketplace.”
Farman believes that by moving forward quickly, Sempra Energy will become one of the leading energy service providers in the United States within the next 10 years. To achieve that goal, the newly formed company will remain headquartered in Southern California, but will attempt to expand into other markets that face deregulation, such as parts of the Northeast.
“The new energy marketplace will require a multi-regional presence,” said Farman.
Farman believes that the restructuring of the utilities industry provides great opportunities for him personally, as well as for Sempra Energy. “I have a unique opportunity as the initial chairman and CEO of a new energy company in the United States. I look forward to building the foundation that will allow us to be successful long-term in the new energy marketplace,” Farman said.
