Texas’ electricity markets would open to competition Jan. 1,2002 if a bill making its way through the state legislature passesthe senate. An earlier version of the bill passed the senate, butanother vote is required there since the legislation changed in thehouse. The governor has voiced his support for deregulation.

The legislation would freeze rates of investor-owned utilitiesuntil competition begins Jan. 1, 2002, and then would lower thoserates 6%. Appropriate consumer protections would have to befollowed by all retail electricity providers. The first-everprogram to help low-income residents, including low-income elderlyand disabled, pay bills and improve home energy efficiency would beestablished.

Stranded cost recovery is provided for, and securitization maybe used as a mechanism for recovering those costs. Stranded costsin Texas are estimated to be has high as $9 billion. Thelegislative session ends May 31.

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