Regulators urge committee to support wholesale energy market development in federal energy bill

WASHINGTON, Sept. 10, 2003 — State utility regulators representing the Mid-Atlantic, New England and the Midwest are meeting with members of Congress and other officials this week to ensure that a final federal energy bill fosters development of national wholesale electricity markets and better electric reliability.

Regulators from the Pennsylvania Public Utility Commission, the Illinois Commerce Commission, the Maine Public Utilities Commission and the Massachusetts Division of Energy Resources today outlined the impact to their regions if potential amendments prevent the Federal Energy Regulatory Commission (FERC) — and individual states — from effectively managing their markets and continuing progress for consumers.

“The Aug. 14 blackout that impacted many of our states clearly illustrated the regional nature of our electricity grid,” said Glen R. Thomas, of the Pennsylvania Public Utility Commission. “Events that occur in one state can indeed impact other states. We need legislation that reflects the physical and business realities of today’s transmission grid and allows for a coherent and comprehensive regulatory framework.”

The regulators are asking Congress to empower FERC to:

* Move forward with its Standard Market Design/Wholesale Market Platform White Paper to empower state and federal regulators and industry stakeholders to manage their markets, deliver benefits to consumers, and achieve efficient, seamless and non-discriminatory wholesale power markets; and

* Establish Regional Transmission Organizations (RTOs) throughout the country to ensure that the lights stay on.

“We urge Congress to strongly oppose any efforts to delay FERC’s important wholesale power market reforms,” said Sharon Reishus, of the Maine Public Utilities Commission. “Any delay will only lead to several unintended consequences and threaten new investment in generation and transmission. We need a modern national energy policy that will allow for regional differences so that states — with either competitive retail markets or vertically integrated utility service — can benefit through greater efficiencies and reasonably priced electricity for our homes and businesses.”

Kevin Wright, of the Illinois Commerce Commission, said, “Our states’ energy customers deserve reliable, reasonably priced power. State regulators need regulatory certainty and a clear set of rules to modernize our infrastructure. Most importantly, none of our states can afford to wait until 2007 for reliability to be ensured and for new rules to be established. Congress made it clear with the Energy Policy Act of 1992 that a national energy market was essential for reliability and efficiency. We cannot allow those efforts to be undone.”

David L. O’Connor, Massachusetts Commissioner of Energy Resources, said, “New investments are needed to modernize our electricity system if we are to avoid further blackouts. For our consumers, these new investments would mean greater efficiencies, creating billions of dollars in savings. We urge Congress to support new investment, better reliability and more money in electric customers’ pockets.”