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Telco Cites Competition in Effort to Raise Residential Rates

Fortnightly Magazine - June 15 1996

A move by Bell Atlantic-Pennsylvania, Inc. to "rebalance" its existing rate structure has drawn opposition (em both from competitors that oppose planned reductions in rates for competitive services, and from consumer advocates concerned about the increases in residential rates proposed under the plan.

The Pennsylvania Public Utility Commission (PUC) has now suspended the plan for a full investigation, noting that the proposed rate increases "would have a definite effect on universal service."

The company had defended its "revenue neutral" plan (including over $41 million in residential rate increases), saying it could no longer afford to charge above-market rates for newly competitive services while maintaining below-cost rates for basic service. But the PUC questioned whether local competition justified the rate hikes: "It is obvious that the majority of Bell's local exchange service customers will not have any competitive alternatives for some time to come." Pa. PUC v. Bell Atlantic-Pennsylvania, et al., R-00963550, et al., March 1, 1996 (Pa.P.U.C.).

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