Feds prefer legislative solution for now, but warn of bid-rigging, cartel behavior later on, after deregulation.
One of the nation's top antitrust officials told the House...
power, but that "the cleanest way to accomplish real competition is by separating the businesses." Burton said the danger lies in the remaining integrated monopoly, although ISOs will reduce the problem.
John N. O'Brien, CEO and chair of Wheeled Electric Power Co., insisted action was direly needed to protect the free market.
"State regulators are not in a position to effectively address these issues and federal intervention is necessary to protect American consumers from anti-competitive practices by incumbent utilities," he said. Based on experiences in the Northeast market, benefits of competition won't be realized without federal intervention, he noted. He insisted that former monopolies use practices and arrangements to maintain their market grip as long as possible.
"We have seen that unregulated utility affiliates will sometimes tie their product, the electric commodity itself, to the parent utility's product of reliable delivery," he said. "The fact is that competitors deliver with exactly the same level of reliability." Utility affiliates also can use the credit worthiness, personnel, customer education programs and other information of their parent company, he said.
Others who testified included Ricky Bittle, planning, rates and dispatch director of the Arkansas Electric Cooperative Corp.; attorney James I. Serota of Huber Lawrence & Abell; and Michael J. Travieso, Maryland People's Counsel. t
Joseph F. Schuler Jr. is associate editor of PUBLIC UTILITIES FORTNIGHTLY.
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