TX Reps Want Dereg Control, OK Opts to Wait
Though they've been told again and again by state regulatory
officials that a California crisis can't happen in Texas, two
Houston lawmakers have filed legislation to expand the state's
authority to limit electric deregulation, which begins on a pilot
basis in June. And in Oklahoma, legislators have decided to
postpone deregulation for at least two years.
California's problems, it seems, now are affecting other states'
Texas, well on its way toward full deregulation, begins a pilot
program in selected parts of the state this June. Then, next
January, the entire state is deregulated. Even though the Texas
Public Utilities Commission reports that it is well prepared and
faces no problems remotely similar to what is happening in
California, some legislators are starting to worry.
State Rep. Sylvester Turner, a member of the Texas House State
Affairs committee who helped draft the original deregulation law in
1999, introduced House Bill 918, which would allow regulators to
extend price limits on residential electricity, limit wholesale
electric prices and suspend certain regulation-related collections
from taxpayers. Co-author Rep. Kevin Bailey said the California
problems led to the new legislation.
"We both have concerns about what's happening in California,"
said Bailey. "What we're saying is, if there are signs that dereg
is not going to work, let's put the brakes on it."
The Texas PUC noted that the state's law already gives PUC
authority to delay competition under certain conditions. However,
Bailey said the new legislation would clarify those conditions. It
also gives regulators more authority to limit deregulation after it
takes full effect in 2002.
To ward off unforeseen problems, the Texas PUC last week said it
would consider giving utilities more flexibility in how they would
offer a 6% rate cut that is mandated when statewide deregulation
begins. This way, more customers might not see a reduction in their
summer bills, but would have a larger cut in their winter heating
bills. PUC Chairman Pat Wood III said that an electricity provider
could leave rates the same from May through September and then cut
them 12% in the winter months of October through April.
For Oklahoma, which was not as far down the deregulation road,
state legislators now are planning a more leisurely route, saying
they will push back their deregulation plan for "at least two
years." Rep. Larry Rice, who chairs the House energy and Utility
Regulation committee, said the delay "seems to be a pretty popular
consensus." He said he thought industry needed time to "get their
companies ready for it, physically, and also to educate the
In 1997, the Oklahoma Legislature set July 1, 2002 as its goal
to implement deregulation, and it had expected to take up the issue
in earnest next month when it reconvened.
"We've got to make sure that everyone has a comfort level," Rice
said. "Even though we're totally different from California,
perception is what we deal with."
Carolyn Davis, Houston