[BETA] Fortnightly

Electric Competition Moves On

The recent months have brought a flurry of activity in a number of states:

ARIZONA: The Arizona Corporation Commission approved rules opening Arizona's electric industry to competition over a four-year period starting in 1999. The rules allow retail customers to retain standard electric service, or to choose competitive services.

Beginning Jan. 1, 1999, utilities must make available 20 percent of its peak 1995 demand to all customers, including small business and residential. No more than 50 percent of that amount may be sold to large customers, and 15 percent of the total will be reserved for residential customers.

Starting on Jan. 1, 2001, 50 percent of a utilitiy's peak 1995 demand must be available competitively. Thirty percent of that total must be reserved for residential customers. Finally, on Jan. 1, 2003, 100 percent of the total electric supply will be available on the competitive market.

All electric companies will have to get commission approval to provide competitive services. Although early drafts of the commission's proposal excluded the Salt River Project from participating in the competitive market, SRP was allowed to participate by signing an intergovernmental agreement. However, a hearing regarding SRP, a municipality serving 635,000 customers, will be held prior to final approval.

Several issues remain to be decided, including how to deal with stranded-cost recovery. The commission is holding a series of workshops to decide such issues.

COLORADO: The Colorado Public Utility Commission released a 125-page electric restructuring report, which is a compilation of responses to a PUC questionnaire. The report, which is intended for information purposes only, was

distributed to legislators, the governor's office and members of the utility community.

"We've packaged the various perspectives into a single report to give the reader a broader and deeper understanding of what the issues are," said PUC Director Bruce Smith. Both the report and the 40 responses are available through the PUC Web site at http://www.puc.state.co.us.

GEORGIA: The Georgia Public Service Commission has decided to initiate a series of electric restructuring workshops starting in April to explore the issues that will be encountered in the move to a competitive environment.

It said that regulatory reform has not been as urgent in the southern states where electric rates historically have been lower than the national average.

"While we certainly have a lot on our plate in facilitating telephone competition and in deregulating the natural gas industry, it is important that we prepare for electric restructuring expected in the coming years," said PSC Chairman Dave Baker.

Meanwhile, the Georgia General Assembly is preparing to enact legislation deregulating the gas industry in the spring session. The Georgia House and Senate Gas Study Committees last December had issued their findings to the legislature.

INDIANA: Indiana state Rep. James Bottorff (D) and state Senator Morris Mills (R) have introduced legislation in the Indiana General Assembly allowing all customers to choose their electric suppliers by mid-2004. During a five-year transition period, electric rates either would be frozen or gradually lowered to a state average price.

Customers would choose their power supplier as early