Murkowski Outlines Senate's Electric Deregulation Agenda
The U.S. Senate is closing in on a set schedule of hearings for
all pending federal electric deregulation proposals, Senate Energy
Committee Chairman Frank Murkowski (R-AK) said at a committee
hearing Wednesday. The schedule will include a hearing date for the
Dept. of Energy Secretary Bill Richardson's administration
proposal, allowing interested parties to comment on its
controversial 7.5% renewable energy mandate.
Murkowski named the renewable mandate as one of his main concerns
in the administration's bill. "[The mandate] will cost consumers
billions of dollars in higher electric rates and is not physically
achievable," the Senator said. He also disapproved of the inclusion of
a federal date-certain mandate on the states as well as other programs
that, in Murkowski's view, have nothing to do with deregulation. He
asked for all witnesses who testify at the upcoming hearings to
address these concerns. Murkowski voiced these doubts just days after
a House Commerce subcommittee hearing on power restructuring revealed
that House lawmakers are battling over main power deregulation issues
as well (See Daily GPI, May 21).
On the positive side, Murkowski said he approved of certain
issues in the bill, including: repeals for PUHCA (Public Utilities
Holding Company Act) and PURPA (Public Utility Regulatory Policies
Act), the bill's suggestions on what to do with federal power
marketing administrations and the Tennessee Valley Authority, its
allowance of open access on all wholesale transmission and its plan
to deal with the high cost of electricity in rural communities.
With all the pluses and minuses associated with power
restructuring issues, Murkowski warned the administration that
compromise is key. "I must say that if the administration threatens
to veto any bill that does not include their pet provisions that
are unacceptable, it will be the administration, not Congress, that
is costing U.S. consumers the benefits of competition."
The commencement of hearings could not happen soon enough,
according to Chrisman Iribe, COO of USGen, PG&E's competitive
generation unit, and president of the Electric Power Supply
Association (EPSA). Iribe testified at Wednesday's hearing that
electric deregulation has progressed inconsistently, leading to
reliability problems and prohibiting the retail market from
developing. "In short, the lack of a national policy on retail
competition has contributed significantly to the uncertainty of the
wholesale market. This uncertainty, in turn, has prevented an
orderly and market-responsive infrastructure investment in
generation and transmission.The correlation between retail
competition and wholesale competition is very strong-you can't have
one without the other."
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