Professor Peter Navarro, who teaches economics and public policy at the University of California at Irvine, writes in the Harvard Business Review (January-February 1996) that "[t]he deregulation of the electric utility industry represents an important opportunity to enhance the country's competitiveness and improve the standard of living for its citizens. ... It is the time to move boldly forward to forge an open market, in which competition and choice are the rules and not the exceptions." He argues that a "coordinated federal policy" is needed to "radically restructure" the electric industry. According to Professor Navarro, "a leaner industry will enhance U.S. competitiveness and improve the standard of living for everyone [emphasis added]."
Professor Navarro is a distinguished economist. Not surprisingly, he espouses competition. Also not surprising, he favors federal deregulation of the electric industry, given that he lives in California (em where electric rates are roughly 50 percent above the national average.
But I don't live in California. I live in Virginia, and our residential electric rates in 1995 for investor-owned utilities (IOUs) were 11.5 percent below the national average. Our commercial electric rates were 23 percent below the national average. And our industrial electric rates were 17 percent below the national average. Regionally, there is also a significant difference in electric rates. For example, Virginia industrial electric rates were 39 percent below the mid-Atlantic regional average and 6 percent below the south-Atlantic regional average.