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Electric Restructuring Legislation: Handicapping the 106th Congress

Fortnightly Magazine - February 1 1999

states should play in either a partnership with FERC or on a regional basis in adapting whatever national standards to be enforced by FERC, " says Charles D. Gray, NARUC general counsel. "There's not a single piece of legislation that we'd say answers all our needs and again relates back to the role of how state commissions participate in the enforcement, development of standards and the whole reliability regime."

The Thomas bill, S. 722, is to NARUC's liking, since it gives states the authority to order delivery of electric energy to all consumers. There's no mandate, but some fear this approach could result in increased rates for low-density states. One Hill observer says he would not rank this bill among the other restructuring bills, but that it was a "bookmark" on how Thomas would vote in committee.

An industry association staff member says the Thomas bill was important in that it helped forge the debate on state-mandated competition. "I think a lot of the Senate bills were placed out there as a marker to help promote and encourage debate and I think what we've learned over the last two years is there's not the support, and i.e., votes, for a federal mandate type legislation," she says.

The House is more willing than the Senate to embrace a federal mandate. Bliley is on record as supporting a mandate, even though common wisdom might show little support for one.

Gorton has been supportive of a date and a mandate, but was not as supportive of Bumpers on stranded cost recovery. Gorton was looking into what support he has for the Bumpers-Gorton bill, S. 1401. But according to Hill observers, he'll focus on municipal tax issues, leaving it unclear as to whether he'll target an all-purpose bill or a muni tax and Bonneville Power Administration bill - his two highest priorities.

Jeffords' bill, S. 687, similar to H.R. 1359, is expected to be re-introduced, with some changes, according to his staff. The bill sets up a national public benefits fund to pay for renewables, universal service and energy conservation, among other areas. The fund is paid for through a wires charge of 2 mills per kilowatt-hour or less.

NARUC, for one, has no firm position yet on public benefits, but it supports Congress in making sure state programs aren't restricted through legislation.

Some think that working conservation or other programs into the restructuring bill would kill any chance of its passage. One of the largest electric restructuring issues for the new Congress will be answering the question of what is meant by "comprehensive legislation."

"One person's comprehensive legislation is another person's piece of atrocity because it doesn't include my Clean Air Act fix, or it does include something else," Gray says.

The broader the scope, the harder it will be to move bills. If the Senate insists on taking up tax, Power Marketing Administration, Tennessee Valley Authority and other issues, it may be difficult to move legislation forward.

House Action: Will Largent Lead?

In the House, electric restructuring policy will be shaped by the loss