Part way through the Feb. 27 conference on electric competition, it was so quiet you could hear a hockey puck slide across the ice. No, hell had not frozen over. Rather, it was Commissioner Marc...
As a student of utility regulation, you will of course know the difference between the Ninth and the Tenth Amendments. If not, let's reiterate.
The Ninth permits everything that is not prohibited. The Tenth prohibits everything not otherwise permitted. The one governs the People; the other governs the Government. That's all there is. Now imagine standing on both feet behind a podium, in front of a luncheon crowd of about 100 think-tank types, and holding an audience spellbound for over an hour as you expound upon this noble topic. Sound daunting? Not to Daniel Fessler, president of the California Public Utilities Commission (CPUC).
He didn't trip over a single word. You had to be there.
Providing the occasion for Fessler's feat was the Cato Institute, a conservative think tank that put on a conference in Washington, DC, back in early March entitled, "New Horizons in Electric Power Deregulation." The Cato Institute describes itself as a public policy research organization bent on "expanding civil society and minimizing the role of political society." It promotes the "voluntary interaction of individuals and associations." The Wall Street Journal has described Cato as "one of the fastest growing think tanks in Washington." Lately, Cato has published such works as Eco-Scam: The False Prophets of Ecological Apocalypse, Telecommunications: Politics or Markets, Prosperity versus Planning: How Government Stifles Economic Growth, and Grassroots Tyranny: The Limits of Federalism.
Among those leading the Cato summit were Richard Bilas of the California Energy Commission and noted regulatory pundits Robert L. Bradley, Jr., market development specialist at Transwestern Pipeline Co., and Robert J. Michaels, professor of economics at Cal State Fullerton. Bradley serves as president of the Institute for Energy Research (IER), based in Houston. He has released a draft of the first part of a proposed two-part study of U.S. electric regulation entitled, The Rise and Coming Fall of Political Electricity, which weighs in at 115 pages and 367 footnotes. In it he explains such mysteries as why solar and wind energy is actually more scarce than competing depletable resources, and comments on which president (em Carter, Reagan, Bush, or Clinton (em has actually done the most to promote renewable energy.
Michaels distributed his new study, Restructuring California's Electric Industry: Lessons for the Other Forty-Nine States, published by and available from IER. This 117-page paperback features an introduction from Bradley and excerpts from testimony that Michaels presented last year at the CPUC's electric restructuring hearings. It answers such questions as "What is it that utilities actually sell?"
For example, Michaels debunks claims that utilities "sell not electricity but `electric services.'" He muses, "Grocers sell a commodity called food, which buyers convert into `dining services' by combining it with their time, seasoning, etc." Michaels then implies that demand-side management is ideal for supermarkets since, "[P]eople consistently eat the wrong foods [so that] imprudent food purchases burden landfills and allocate more land to farming than is needed."
Into this rarified atmosphere stepped Fessler, who, just eight days earlier, had seen the Federal Energy Regulatory Commission (FERC) strike down his (the CPUC's) latest