Utility Restructuring/Deregulation Bibliography

Ad-Hoc Group of Regulatory and Energy Economics Professionals. Manifesto on The California Energy Crisis, January, 2003. This study claims the state’s energy crisis was the "consequence of a flawed regulatory design and of misguided decision-making at the time of the crisis, rather than the result of any inherent inability of electricity markets to work."  It suggests five measures the state should take to address its energy issues: rely on markets whenever possible, rely on competitive procurement to meet California electricity needs, clarify jurisdiction of state and federal agencies, encourage the creation of true commodity market institutions and promote their use, and implement real-time pricing.

Consumer Federation of America. A Discouraging Word (or Two, or Three or Four) About Electricity Restructuring in Texas, Pennsylvania, New England and Elsewhere, March 2003.  This study, which was also sponsored by the Consumers Union and the U.S. Public Interest Research Group, is one of several by CFA Research Director Mark Cooper.  In this study, Cooper claims the restructured electricity markets in New England and elsewhere around the country throw windfall profits to power generators without giving consumers lower prices.   Cooper maintains that regulatory mandates, not free market forces, are delivering benefits to consumers. He stresses that the stampede to restructuring has stopped in the states and it should stop at the Federal Energy Regulatory Commission as well.

Consumer Federation of America.  All Pain and No Gain: Restructuring and Deregulation in the Interstate Electricity Markets, September 2002.  This study, also authored by CFA Research Director Mark Cooper, warns that the federal push to deregulate and restructure the electric utility industry threatens to increase the price of electricity by tens of billions of dollars. The study urges federal policymakers of the need to step back and fully understand the implications of the massive fraud and financial meltdown that has occurred in the electricity industry. It bases its conclusion on a comprehensive examination of the behavior of electricity markets that have been deregulated as well as simulations of the impact of deregulation on prices in states that chose not to restructure their markets. The report concludes that the fundamental conditions of supply and demand create numerous sources of price increases that regulators cannot control.

Consumer Federation of America. U.S. Capitalism and the Public Interest: Restoring the Balance in Electricity and Telecommunications, August 2002. This report is another analysis by CFA Research Director Mark Cooper. It argues that deregulation of electricity and telecommunications destroyed the critical balance that U.S. policy had struck between private incentives and public obligations. It did so in five ways: public infrastructure, public resources, public responsibility, public participation and cooperation, and public information and knowledge. It further argues that if the Public Utility Company Holding Act (PUHCA) had been enforced vigorously, the market manipulation that afflicted California never would have happened. CFA also points out that the Senate has voted to repeal PUHCA rather than strengthen it.

Consumer Federation of America.  Electricity Deregulation and Consumers: Lessons From a Hot Spring and a Cool Summer 08-30-01, August 2001. This analysis is another by CFA Research Director Mark Cooper that reviews the California situation, along with other states. While critical of deregulation’s structure in almost every state, charging that policymakers rushed to provide competitive markets without ensuring that certain conditions exist to allow competition to occur, Cooper lists measures that can be taken to make it work for consumers.

Consumer ReportsŪ. Deregulated, July 2002. This article details how deregulation has affected consumers and what they can do to better protect themselves. It examines five industries where deregulation has had a direct impact on consumers: airlines, telephone, cable television, banking, and electricity.  It concludes that while consumers have made some gains under deregulation, on average they have lost ground.

Consumers Union. GAO Report Confirms FERC Failed to Protect Consumers During Western Electricity Crisis, June 2002. This press release summarizes the findings in a report by the Government Accounting Office, which says the Federal Energy Regulatory Commission (FERC) failed to develop ways to protect consumers during the California energy crisis and is still unable to assure fair and reasonable electricity prices. In response to the report, Consumers Union concludes that price caps in the western markets should remain in effect because of FERC’s inability to do its job.

Consumers Union. Tall Tales of Texas: Electricity Deregulation – cute as a possum or plum ugly? This PowerPoint presentation – presented to the National Association of State Utility Consumer Advocates on June 17, 2002 – looks at the Texas market structure. It provides a general overview of the residential market, debunks the myths surrounding Texas’ deregulation, and criticizes the Public Utilities Commission for not delaying the market opening based on the failed results of the six-month pilot program, among other issues.

Consumers Union.  New Electricity Market Offers Consumers Fine Print and Frustration, March 2002.   This six-page report, released by the Consumers Union office in Austin, provides information on the suppliers and rates available since deregulation began in some areas of Texas on January 1. The report helps consumers decipher company offers -- some companies, for example, didn't include their monthly service charge in their rate offers. The report also analyzes the fine print in electric supplier offers: prices that may change from month to month, monthly service charges that change during the higher-rate summer months, fees for late payment and/or to cancel service, etc.

Consumers Union. Drift and Disarray: The California Energy Crisis Continues, March 2002. This paper by the Consumers Union office in San Francisco presents findings on the status of California’s restructured electricity market. It reports on retail electricity rates, consumer and wholesale market protections, power reliability, and the potential for more renewable energy projects since deregulation. It also makes predictions of what’s to come if the market is not redesigned, and offers suggestions that the Governor could take to stabilize the market.

Consumers Union. Protecting California’s Residential and Small Business Electricity Consumers, January 2002. This report recommends a return to a regulated market by the state's public utilities commission as the way to protect residential consumers and small businesses from price spikes and market instability. It proposes that large businesses be allowed to buy electricity directly on the open market, as long as they are first held responsible for paying off their share of the long-term energy contracts negotiated by the state last year.

Energy Foundation. California's Secret Energy Surplus: The Potential for Energy Efficiency, September 2002.
This study estimates potential energy and peak demand savings from energy-efficiency measures in California. In contrast to energy conservation, which often involves short-term behavioral changes, energy-efficiency opportunities are typically physical, long-lasting changes to buildings and equipment that result in decreased energy use while maintaining constant levels of energy service. It was recently estimated that roughly 70 percent of California’s peak demand reduction in the summer of 2001 is attributable to short-term conservation behavior rather than long-lasting efficiency improvements (Goldman et al. 2002). This study shows that significant additional and long-lasting energy-efficiency potential exists.

Foundation for Taxpayer and Consumer Rights. HOAX: How Deregulation Let the Power Industry Steal $71 Billion From California, January 2002.  Claims that the state’s energy crisis was a hoax, set up by deregulation, to suck billions of dollars out of the state, and that the crisis isn’t over yet.

Keystone Research Center. Pennsylvania Utilities: How Are Consumers, Workers and Corporations Faring in the Deregulated Electricity, Gas and Telephone Industries? May 2001. Analyzing preliminary data from 1994 through 1999, this report claims that restructuring has led to longer power outages, higher profits, negative in-state reinvestment, and higher executive salaries. It urges the state to conduct a comprehensive assessment of deregulation.

Louisiana Public Service Commission. Report to the Commission Staff on Retail Access Collaborative Issues, February 25, 2003.  In its draft report on retail access, the Louisiana PSC stated that restructuring efforts and experiences nationwide during 2002 validates its slow and cautious approach to retail access.  It recommended that transmission studies be conducted to make better use of capacity resources, and that utilities consider fuel diversity in their planning to mitigate gas dependency and rate instability. 

Maryland Public Service Commission. Ten Year Plan (2001 - 2011) of Electric Companies in Maryland, December 2002. In its ten-year plan for electric companies operating within the state, the Maryland Public Service Commission reports on the long-range plans of Maryland's electric companies and includes summaries of major events that have or may affect the electric utility industry in Maryland in the near future.

Ohio Consumers Counsel. 2002 End-of-Year Update on Ohio’s Electric Market, December 2002. This report calls for the Public Utilities Commission of Ohio (PUCO) to take prompt and decisive action to address the problems of retail competition in Ohio, which the Consumers Counsel details in this report. It claims that the Ohio General Assembly placed responsibility for the success of electric choice largely in the hands of PUCO, and if electric choice is to yield its intended promises, now is the time for action. However, it claims that action alone will not be enough. It must be coupled with continued progress at the federal level on key transmission issues. Federal support and direction are needed to ensure that residential electric customers receive the benefits that Ohio's electric choice legislation intended.

Oregon Public Utility Commission.  Evaluation of a Competitive Power Market for Residential Customers, December 2002.  In its report to the Seventy-second Legislative Assembly, Oregon's PUC concluded its residential customers would not benefit from electric competition at this time. The report stressed that the amount of time residential customers spend reviewing their energy options would not outweigh the benefits of choice, as few suppliers are expected to compete in the residential market. In addition, the PUC found that rate decreases experienced in other states after implementing residential choice were mainly the result of temporary caps.

PennFuture. Electricity Competition: The Story Behind The Headlines - A 50-State Report, August 2002. This report by the pro-deregulation environmental group PennFuture lauded deregulation as a success in Pennsylvania as well as nationally.  It analyzes national price data from 1996 through 2001 and concludes that deregulation has lowered rates in most states, including Pennsylvania, and has contributed to the growth of clean energy. 

Poughkeepsie Journal. Monitoring Unit Checks for Price Manipulations in N.Y., May 2002. This article reports on a New York market monitoring unit, the New York Independent System Operator Market Monitoring Unit, created by the Schenectady-based NYISO to keep an eye on bids and prevent manipulations. The unit is made up of 19 members who have experience working in the energy markets and backgrounds in economics and statistics. Through a computerized, Internet-based system, if the monitoring unit detects an unusually high or low bid, which may indicate price manipulation, members investigate. Since NYISO was created, it reports having investigated only a half dozen unusual bids, which may indicate the procedure has acted as a deterrent to price manipulation.

Public Citizen. The Public Utility Holding Company Act and the Protection of Energy Consumers: an Examination of the Corporate Records of the Top Companies Pushing for PUHCA Repeal, September 2002.   This report provides information about the main energy companies -- American Electric Power, Duke Energy, CMS Energy, Southern Company/Mirant and Xcel -- that are striving to repeal the Public Utility Holding Company Act (PUHCA).  It reports that abolishing PUHCA would largely remove government oversight of these companies and this would lead to further industry consolidation, more deregulation and the creation of corporate structures that leave consumers and investors at the mercy of unaccountable, growth-hungry conglomerates.  Public Citizen has examined the companies' corportate responsibility records, which it claims are bleak, suspicious and possibly fraudulent.   It presents data on the amount of money these companies have spent on lobbying Congress and on campaign contributions to Federal candidates.  It also submits that some of these companies pushing for the repeal of PUHCA are the same ones that are being investigated for gouging ratepayers and maipulating the California energy market through schemes involving sham energy trading and the withholding of electricity.

Regulatory Assistance Project.  Portfolio Management: Protecting Customers in an Electric Market that Isn't Working Very Well, September 2002.  This paper describes a new approach to markets, Portfolio Management, that maintains a balanced portfolio of supply and demand side resources, reduces the risk of volatile short run markets, provides stable rates, and delivers constant environmental improvements.

Texas Public Utility Commission.Scope of Competition in Electric Markets in Texas,  January 2003. Reported that retail electricity customers in Texas saved more than $1.5 billion after deregulation began in January 2001. The report to the Texas legislature said the savings are based on a comparison with regulated rates that were in effect during 2001. However, the PUC also recommended that the legislature consider some changes to the system to prevent abuses. State lawmakers need to "expand or clarify" the commission's authority, particularly relating to oversight of the electricity industry, the PUC said. Specifically, the agency wants the cap on administrative penalties it can use to be raised.

U.S. General Accounting Office.  Energy Markets: Concerted Actions Needed by FERC To Confront Challenges That Impede Effective Oversight, June 14, 2002. GAO's investigation into the Federal Energy Regulatory Commission (FERC) found that it has not adequately revised its regulatory and oversight approach to respond to the transition to competitive energy markets.  GAO found that FERC: has had difficulty recruiting staff because it has trouble competing with private sector salaries; faces the retirement of more than one-quarter of its emmployees by 2005; has not taken advantage of the full range of personnel flexibilities and tools available to federal agencies; and has not developed a strategic management plan.

U.S. General Accounting Office.  Lessons Learned From Electricity Restructuring: Transition to Competitive Markets Underway, but Full Benefits Will Take Time and Effort to Achieve, December 2002.  This GAO study reports on the extent to which federal and state actions, to date, have achieved the goal of restructuring.  GAO discusses lessons learned from efforts to date.  GAO recommends that the Federal Energy Regulatory Commission: 1) determine how restructured markets are performing across the country, and 2) report annually to Congress and the states on the status of these markets, including emerging issues and impediments to reaching its goal.

U.S. General Accounting Office. Restructured Electricity Markets: California Market Design Enabled the Exercise of Market Power, June 21, 2002. GAO’s analysis and other studies it cites found evidence that wholesale electricity suppliers exercised market power by raising prices above competitive levels during the summer of 2000 and at other times after restructuring and that California’s market design enabled the exercise of market power. 

Village Voice. "How Pataki's Disastrous Energy Plan Fattened His Friends and Campaign Coffers: Bad Policy, Big Bucks," October 23-29, 2002. This article by Wayne Barrettterms declares New York’s deregulation experience a disaster that no one’s talking about. It details the monetary connections between Governor Pataki and major utilities and new merchant generators, including their contributions to Pataki’s successful 2002 re-election campaign.

Virginia State Corporation Commission. Review of FERC’s Proposed Standard Market Design and Potential Risks to Electric Service in Virginia, January 2003.  In its report to the Legislative Transition Task Force, Virginia's SCC sharply criticizied the Federal Energy Regulatory Commission's Standard Market Design proposal. It reports that FERC's SMD threatens the state's ability to assure reliable service at stable and reasonable rates. 

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