A federal court blocks FCC's "TELRIC" cost rule, but some states endorse it anyway.
With the Federal Communications Commission (FCC) having lost a major court battle last fall, the state...
and/or federal legislators, the major role of the PUC in five years will be about the same. We may not be doing as much retro-action as in the past, but doing more activities that encompass the requirements of regulatory competitiveness. More flexible pricing will be developed, reciprocal agreements with other states will go along with tracking of activities in other jurisdictions, competitive bidding on all areas of supply, delivery, and service will become common - regional transmission will take on a more important role. Along with continued exploration of new alliances, approval and denials of mergers will increase. We will see a wide variety of corporate restructuring as well as increased activity in foreign investments. All this will require the PUC to refocus on its main role and adjust as needed. [End of Ingram response]
Response by Daniel Wm. Fessler, President, California Public Utilities Commission:
This issue of agency reform is under active debate both within the California PUC and well beyond it. In mid-September, our legislature embarked on a brief recess between sessions without acting on a variety of initiatives all directed at the future role of regulation and the entity that would perform those functions. While I would hesitate to predict the outcome of that debate, my colleagues Greg Conlon and Jessie Knight have engaged our staff on a broadly cast inquiry into the future mission and composition of this entity. Termed "Vision 2000," we have recently published an assessment of our current strengths and weakness as divined from internal discussion and the solicited participation of the various external "stakeholders" or "customers" with whom we constantly interact. While the initial report does not go beyond the identification of problems and the affirmation of generally stated policy and service objectives, it clearly defines the need for reform.
If I may conjecture on the conclusions that will emerge from stage two of the Vision 2000 exercise, I anticipate a continuing shift of our focus from ratemaking and command-and-control responsibilities to reliance upon competition. Contrary to the vocal expectations of some, I do not see in this future the elimination of a role for government. Indeed, I see competitive models as a means to an end rather than an end in themselves. In 2000 I predict that our successors at the PUC will not have witnessed a fully accomplished shift from the realm of regulated monopolies to the reality of fully competitive markets. We will thus still be in the "meantime" concentrating on facilitating the emergence of competition and ensuring the integrity of the markets. I suspect that we will be heavily involved in making certain that customers have access to information so that their choices may be informed and there are remedies to discipline those who engage in consumer disinformation. Finally, I anticipate a renewed concern for both safety and reliability with respect to the provision of many of the goods and services society - for good reason - has long identified as "necessaries." In the classical era of the regulated monopolist functioning in a cost-plus environment these objectives were readily attainable.