Deregulation for Real

Deck: 
High power bills, with the lifting of rate freezes, give pause to politicians.
Fortnightly Magazine - April 2006
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The Baltimore Sun recently carried a very poignant letter from one of its local readers— a letter that utility executives might well take to heart. Appearing under the title, “Energy Advice Cruel to Poorer Readers,” the letter took offense at an article that trivialized the effect of the huge increase in local electric bills (35 to 72 percent) expected this July with the lifting of a long-standing retail rate freeze. The Sun article had suggested that Marylanders could cut their $300-per-month dining expenses, or drive to Virginia Beach for vacation, rather than fly to Florida.

The reader, however, was not amused: “A single mother with two children earning, say, $30,000 a year would not find humor in that advice.”

While government programs do offer assistance (one in particular would target families of four earning a maximum of $2,419 a month), this type of human-interest scenario has moved politicians and regulators in various states to take action. These public servants are hoping to moderate the political and economic impact from rising power prices in states that have adopted retail competition, or that are preparing for the end of rate freezes.

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