Letters to the Editor

To the Editor:

"Frontlines" from the Nov. 1, 2003, addressed what Richard Stavros called "AEP's Gutsy Gambit." In the process of panning AEP's strategy, Mr. Stavros demonstrates no understanding or appreciation of the state law issues he purports to address in his essay. I am responding because, by unmistakable implication, Kentucky is one of the "certain state regulators" he repeatedly takes to task.

A major problem with Mr. Stavros' approach to the issue is his apparent complete acceptance of the arguments of Exelon Vice President Elizabeth Moler, who has pronounced that the actions of the Kentucky Public Service Commission and other state regulatory agencies "are directly and deliberately impeding federal policy over interstate transmission." Unfortunately, her analysis is replete with problems. For example, the essay at an early point focuses on section 205 of PURPA, which Moler believes authorizes FERC to "exempt utilities from state laws and regulations that purport to prohibit the voluntary coordination of electric utilities." Her position on that provision, however, has since been roundly criticized by several state parties. Among the many problems with her interpretation of that statute is the explicit provision in that same section 205 that prohibits FERC from overriding a state law that "is designed to protect public health, safety, or welfare." Those protections are precisely the reasons for the numerous state laws that require regulatory approval before utilities may join an RTO.