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...
on sabbatical at Harvard University. The author thanks Michael Clements and Jaison Abel of the NRRI staff for survey data for the telecommunications and electric industries, respectively. He also thanks various senior staff at the cited utility commissions for information regarding electric and natural gas cases.
Comments presented in the Illinois case, as characterized by the commission.*
Illinois Power indicates that the exclusive sharing of corporate support information, services, and personnel between a utility and its affiliated interests will not impact the competitive balance.
Commonwealth Edison asserts that the ban on joint marketing adversely affects legitimate competition and innovation.
MidAmerican Energy asserts that denial of the right of utilities and their affiliated interests to share corporate support services makes them less efficient and places them at a competitive disadvantage.
Nicor Gas states that joint marketing and sales activities by utilities and their affiliates utilize economies of scope and scale, result in cost savings to consumers, and reflect [the] customer's desire for one-stop shopping.
Edison Electric Institute states that requiring utility sharing of non-tariffed services [with unaffiliated entities] attempts to socialize the economies of integration that inherently are a part of any business organization.
* Petition for Rulemaking on Nondiscrimination in Affiliate Transactions for Electric Utilities, 98- 0013, 98-0035, order of Sept. 14, 1998.
Abel, Jaison R. and Michael E. Clements, "Should Utility Incumbents Be Able to Extend Their Brand Name to Competitive Retail Markets? An Economic Perspective,"
The Electricity Journal, June 1998, Vol. 11, No. 5, p. 49-57.
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*Assembled with grateful assistance from Jaison R. Abel, NRRI staff.
1 Competition Handbook, Chapter 5, Negotiation and Arbitrations, 5.1 AT&T Arbitration Scoreboard, October 13, 1997.
2 Citations not given for the references that follow in the