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1996 Regulators' Forum

Fortnightly Magazine - November 15 1996

changes for us to deregulate. That's why we say it's not feasible. However, the rest of it is why we're a little pessimistic. We do have the lowest rates in the country industrial rates . . . about 23, 22 mills [per kilowatt hour]. When you take transmission and everything and try and go out and beat that, I think it's going to be very difficult. Residential customers are paying 5 cents [per kilowatt hour]. Irrigators are paying 3.5 to 4 cents. So you have to wonder what your customers are going to gain by choice other than getting some phone calls [from new electricity suppliers].

"[We're] cautiously pessimistic. We don't see what we've got to gain in this. We think if rates move toward an average, that hurts Idaho. We have a lot of industry that's here because of the low electric rates. . . . If those rates move up to an average, it could be that other considerations would cause some industry to leave the state.

"I'm sure that the legislature is going to give us some direction and we're going to follow that. But we would like to see restructuring done in a manner that . . . captures the benefits that Idaho enjoys now and keeps those benefits for a while." [End of comments by Nelson]

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Comments by John B. Howe, chairman, Massachusetts Department of Public Utilities

Q. NARUC is restructuring. What must it maintain, what must it change, and what qualities must its director have to keep it ahead of industry issues?

A. "I think NARUC today is serving as a very useful catalyst for the restructuring efforts of individual states. "What needs to change is already changing. . . . Members of NARUC would report that there really is a cultural shift going on within the organization. The industries we regulate are changing drastically. . . . I believe NARUC is responsive to the changes in the industry. One of the key challenges we face as a constituency in Washington is to make our voice heard. . . . I think we need to continually do a better job at forming consensus in a timely fashion and representing our views with vigor. . . . We need an executive director who can lead us effectively in that challenge."

Q. How active is your state legislature in electric deregulation? When is this participation helpful? When is it intrusive?

A. "Our department is overseen by a joint committee on government regulations. . . . I would say their interest in deregulation is accelerating. And I anticipate that in 1997 it will be a critical issue. Currently there has been a study committee that's been convened with the assignment of producing a report on electric industry restructuring by December. . . . Our legislature has given our department leeway to move forward with our rulemaking effort, but that's been with the implicit understanding, which I share fully, that we cannot carry the ball over the goal line. "The challenge that all state commissions and state legislatures face

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