Nickles Expects Congress to Deregulate Electric Utilities

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Sen. Don Nickles, R-Okla., said this congress will pass an electric power deregulation bill, but not necessarily this year.

The Senate assistant majority floor leader, and chairman of the Senate Subcommittee on Energy Research and Development made the statement at a special field hearing of the subcommittee Thursday at Oklahoma City Community College Theater.

Nickles said aside from the budget and tax reduction bill, this legislation may be the most import ant that this congress will consider. Testimony was heard from invited state officials, executives of investor owned utilities, rural electric cooperatives, municipally owned utilities, a petroleum industry association, a national retail grocers association, and others. While there was a divergence of positions regarding the complex issues, there also was a surprising amount of consensus among those testifying on some very key questions. All of those testifying had high praise for Oklahoma's progress, and particularly for Senate Bill 500 which was passed by the Legislature last session and signed into law by Gov. Frank Keating. The questions posed by Nickles were simple. What role should congress play? What should congress do? What should it not do? The answer heard most often was that congress should establish a date for deregulation to occur. Most cited was year 2002, which is established in the Oklahoma law. Nearly all of the speakers agreed this was very important to an orderly restructuring of the electric power industry. Others suggested Congress should leave most of the decisions to the states, and should not federally mandate many important aspects of deregulation. One area they did think congress should undertake is revising the federal tax code to provide a uniform tax. A similar requirement for Oklahoma law is in SB 500, and unless accomplished could put off the 2002 date for restructuring to occur. Nickles told the group he will have a hand in pulling together a bill in congress. He said he considers electricity a national commodity, with a strong impact on the economy. He thinks the bill will be beneficial to all and will have an important impact on federal and state relations. He stressed his continuing belief much of what is to be done should be left to the states, saying he has no interest in a federal commission. He agreed, however, a date certain set by congress would be beneficial. "I want to encourage, push and cajole agencies in all states that regulate electric utilities to get away from regulated monopolies." he declared. Oklahoma Corporation Commission Chairman Ed Apple, who was the first to testify, responded by saying Oklahoma as had a competitive market for years, regardless of the regulated monopolies. He suggested regulation is needed at some point, and specifically cited distribution of electricity to residential consumers. Apple said the commission has been examining and compiling data for nearly five years and during that period he has reached the conclusion that the "notion of competition in the electric power industry could be easily `oversold and under explained.'" He said currently there are more questions about this change that are unanswered than are answered. He said he is not convinced at this point the change in the electric power industry is universally beneficial, "particularly at the very quick pace proposed by some parties in Oklahoma. …