Regulatory complexities call for supernatural skills
Jason Thenmadathil, a regulatory analyst with the Oklahoma Corporation Commission, sent a letter to Public Utilities Fortnightly recently. He asked, “How would you define a ‘good regulator’? How do you separate the good regulators from the bad ones?”
Thenmadathil’s question didn’t just come out of the blue. Specifically, he was seeking clarification of a passage from the September 2007 issue (“Sub-Primed and Ready”), in which a Baird analyst recommended “investors focus on utility investments with good regulators, solid business strategies and management that can execute those strategies.”
The simplicity of Thenmadathil’s question, however, belies the impossibility of a good answer—and indeed, the ambiguity of the term “good.”
We picked some excellent regulators for this year’s “Regulators Forum” feature story. But just as beauty is in the eye of the beholder, “good” is a subjective idea, entirely dependent on one’s perspectives and interests. Ultimately, that’s the whole point, as it pertains to the job of a utility regulator.
But to answer the question directly, a regulator’s “goodness” is defined by four fundamental traits: Omniscience; Solomonic Wisdom; Clairvoyance; and Righteousness.