Power-industry restructuring redistributed financial uncertainties that discourage generation investment and ultimately raise the price of electricity to consumers.
This New Congress Means Business
in the House and Senate Energy Committee chairman Frank Murkowski of Alaska have said they plan to deal with the problem this year. A number of bills will be thrown in the hopper, but the working bill in the House, HR 1020, was introduced by Rep. Fred Upton (R-MI), member of the House Commerce Committee. Sen. Bennett Johnston (D-LA) has introduced his own bill in the Senate.
The IOUs may find that many of their goals will coincide with the Republican effort to streamline government and ease the regulatory burden, but it's looking like a difficult year for public power. Even President Clinton has given public power reason to worry, recommending in his fiscal 1996 proposed budget, released at the start of February, that four of the five federal power marketing administrations (PMAs) should be privatized. Clinton's proposed budget recommends selling the Alaska Power Administration, the Southeastern Power Marketing Administration, the Southwestern Power Marketing Administration, and the Western Area Power Administration (em raising about $3.7 billion. The Administration also will send up legislation this year to turn the Bonneville Power Administration (BPA) into a government corporation. However, a number of Republicans still have Bonneville on their hit list for an outright sale. Rep. Scott Klug (R-WI) has introduced a bill, H.R. 310, that would direct DOE to sell all five PMAs. Rep. John Kasich (R-OH), now chairman of the House Budget Committee, called for a similar firesale in his alternative budget last year.
The American Public Power Association (APPA) is greatly concerned about the future of public power, and plans to lobby Congress to reject any sale, transfer, lease, or other change in the PMAs. Ted Coombes, APPA director of government relations, is cautious: "The only thing I will predict is we have a big fight ahead of us." APPA is counting on the Senate to block any sales. Coombes noted that both Senate Appropriations Committee chairman Mark Hatfield (R-OR) and Senate Majority Leader Bob Dole (R-KS) have strong ties to public power. Dole helped bring public power to Kansas. As for the House: "It looks like that train is leaving the station," Coombes said.
There is the potential for considerable tension to emerge this year between public and private power. As Congress looks to new sources of revenue to fund its $200-billion "Contract with America" provisions, APPA is concerned that public utilities may lose their tax-exempt status for bond financing, which the IOUs contend gives public power a competitive advantage. IOUs have expressed concern that regulatory reform called for in the "Contract" could create an uneven playing field for the public and private sectors, by imposing requirements on the private sector but exempting public, or municipally owned, companies.
In other areas, Congress will try again to pass telecommunications reform, take up reauthorization of Superfund and the Endangered Species Act, revisit environmental mandates in the Clean Air Act, reorganize DOE, and slash funding for many energy programs. Congress also plans to implement regulatory reform measures such as risk-assessment legislation requiring greater cost-benefit analysis for new rules and regulations, which could benefit coal-fired