THIS HAS BEEN A YEAR OF FIRSTS FOR ITC (ITC Holdings Corp. and its principal operating subsidiary International Transmission Co.; Novi, Michigan, U.S.). ITC became the first publicly held electricity transmission company on July 26, 2005, when it began trading on the New York Stock Exchange (NYSE: ITC-News). On July 29, ITC successfully closed its initial public offering of 14.375 million shares, and on Sept. 30, ITC's stock was trading at $29.10 a share.

“Going public brings a new level of scrutiny to our business that we welcome,” says Joe Welch, president and CEO of ITC. The company has expanded its board, and has more governance, audit committees and compensation committees to assure the public that ITC is “being run like a company should be run,” Welch notes.

ITC's road to independence culminated in February 2003, when an investor group that included Kohlberg Kravis Roberts & Co. (KKR) and Trimaran Capital Partners purchased ITC from DTE Energy. The current management team took the independent transmission model from a vision to a full-fledged business that is now a much superior model for customers to realize benefits.

Welch believes there are opportunities to get other transmission assets into the hands of an independent transmission company. And, in fact, he is receiving calls from others who want to know how ITC did it. “We have a patchwork system out there, no chain is stronger than the weakest link,” Welch explains. “For the system to work as it should, [we] need players with regional impact. We need a system where owners can be financially incented for improving customers' access to wholesale markets.”

Since taking ownership of the system, ITC has significantly increased capital investment as a means to improve electric reliability. For the six months ended June 30, 2005, ITC has invested approximately $61.5 million in property, plant and equipment, and is expected to invest $100 million in capital investment by year's end.

In its first reporting period as a publicly traded company, ITC announced its financial performance for the second quarter of 2005 on Aug. 24. Operating revenues of $50.7 million for the second quarter 2005 increased by 18.5 million over the same period in 2004. Accounting for $13.8 million of this increase was the expiration of a rate freeze on Dec. 31, 2004, for ITC's customers. The other $4.7 million of the increase was due primarily to the fact that ITC is no longer required to refund point-to-point revenues earned in 2005. In 2004, 75% of point-to-point revenues earned were refunded to customers.

ITC covers about 7600 sq miles (19,683 sq km) throughout 13 counties in Michigan, including the metropolitan areas of Detroit and Ann Arbor, which have a population of approximately 4.9 million. The company's facilities include approximately 2700 circuit miles of overhead and underground transmission lines, 16,000 towers and poles, and 30 stations connecting its facilities. It also owns and manages the Michigan Electric Power Coordination Center located in Ann Arbor.