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Pennsylvania power

September 01, 2000

Pennsylvania power



Folks worried that California's summertime shortage of power - and the high prices consumers were forced to pay for it - will soon face Pennsylvania residents should stop worrying, according to officials of the state's Public Utility Commission.

PUC officials told a group attending a hearing on the reliability of the state's electric supply that California's problems were a result of unique conditions there. Perhaps they are, but given that these two states were among the first to deregulate the sale of electric power, a look at what happened there might prevent California's problems from coming east.

John Quain, chairman of the state's Public Utility Commission, said his agency's analysis of California's problems shows that in contrast to Pennsylvania utilities, which generate more power than the state can use, California hasn't sited a new generating plant in 20 years, during a time when the state's population has grown rapidly. Add to that California's lack of a Pennsylvania-style cap on utility price hikes, Quain said, and problems were inevitable.

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A lobbyist for the Industrial Energy Consumers of Pennsylvania said his group is happy with deregulation as it now, but an environmental group called Penn Future wants three utilities in the state's western region, including Allegheny Power to join a power partnership called the PJM Interconnection, a move it's said will provide more price competition and choices for consumers.

Since deregulation was proposed, we've had two concerns. The first was that in a deregulated market, customers in remote, hard-to-serve areas would be left without suppliers.

The second was that utilities that had invested money meeting mandated requirements (like maintaining reserve capacity, for example), would be at a disadvantage when competing with those firms which hadn't been required to do those things.

So far, we haven't seen evidence of either, but California's woes are a sign the transfer from a totally regulated environment to full competition will need officials scrutiny for a while longer.

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