Illinois Commissioner Ruth Kretschmer Wanted Answers About Restructuring.
Twenty years ago, in February 1996, the cover of Public Utilities Fortnightly was emblazoned with the words: Competitive Generation: Are We There Yet? The lead article was authored by Ruth Kretschmer, a highly respected commissioner on the Illinois Commerce Commission.
Kretschmer served as a regulator there for twenty years, July 1983 - December 2002. She also chaired the Commission for a time, as well as the NARUC Gas Committee.
Her long service would not be extended by incoming Illinois Governor Rod Blagojevich. Yes, this is the same Governor who infamously said in an FBI wiretapped phone call (about his leverage to fill a vacancy to the US Senate):
"I've got this thing and it's {f-word} golden, and, uh, uh, I'm just not giving it up for {f-word} nothing. I'm not gonna do it. And, and I can always use it. I can parachute me there."
In her lead article, Kretschmer was a skeptic about the hype surrounding electric industry restructuring:
"Statements based on little factual data or evidence - such as "restructuring will benefit all customers" and "restructuring will lower all customers bills" - are accumulating faster than the snow that buried the East Coast last month. It's an accepted truism that a statement made often enough becomes a fact."
Kretschmer asked a fundamental question in the article about the industry's transformation:
"If the answer is lower prices, is restructuring the electric industry the best and least disruptive solution? How many high-cost (i.e., nuclear) electric utilities are there?"
I'm Monday morning quarterbacking, admittedly. High-cost nuclear plants drove restructuring, yet these plants have generally been the lowest cost power producers since.
She also asked: "If the industry is deregulated and all customer classes are allowed to choose their electric supplier for generation and transmission service, how will "last resort customers" be handled?"
As it has turned out, nationally, only a fraction of residential and small commercial consumers have opted to be served by a competitive supplier of generation and transmission. The last resort issue didn't become a problem. See the article by Terrance Fitzpatrick in this issue of Public Utilities Fortnightly.
An institution of the utilities industry since 1929, Public Utilities Fortnightly has a unique responsibility to remind us of our past particularly when the past informs us about our future.
Steve Mitnick, Editor-in-Chief, Public Utilities Fortnightly
E-mail me: mitnick@fortnightly.com
