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E-M:/ Electric competition Free Press editorial



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Enviro-Mich message from Sally Billups <mec@voyager.net>
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Detroit Free Press

POWERFUL ISSUES: More electrical utility competition is in order 

June 1, 1998

Michigan is moving into a hot summer with all the big questions about
utility deregulation still unresolved. There's a package of bills being
prepared in the Legislature that attempts to unravel the knot, but it
will take a lot of scrutiny and balancing of interests for it to
succeed. 

 Deregulation is supposed to be good for both the utilities and their
customers, or why bother with it? Most residential consumers are happy
enough now if the lights go on when they flick the switch. They're not
clamoring for change. Industrial and commercial users want reliable
service as cheaply as they can get it. They are impatient for change,
however, because they see the benefits of an open market in electricity. 

The last thing anybody wants, though, is a plan that cushions utility
profits while raising prices to consumers and denying them the benefits
of choice and competition. Yet so far, Michigan has been fairly timid
about confronting those basic issues. Meanwhile, if this turns into a
scorcher of a summer, the possibility looms of brownouts or outages in
southeast Michigan. That, too, is an issue related to the lack of
progress on deregulation. 

The Public Service Commission has ordered Detroit Edison to allow a
limited amount of retail wheeling, or bringing in power from outside
sources. This has two benefits: It begins to open up the market to
competition, and it might help ensure adequate power for the season
ahead. Edison resisted the order in the courts, and lost twice. Now the
question arises: Did the PSC mean what it says, or not? 

The commission has the power to force the opening wedge of competition
here, which some business groups (and some potential competitors of
Detroit Edison) would dearly like to see happen. Some of them have
suggested that the PSC should tell Detroit Edison to get the retail
 wheeling plan going, or the PSC will not allow the utility to charge
customers for power generated by the resurrected Conners Creek power
plant this summer. That's playing hardball, but it would certainly get
Detroit Edison's attention. 

You can understand the desire of the utilities to delay new investment
in power generation until the shape of deregulation is settled, to hang
on to their market share and to cushion the shock of the unknown.

 But there are broader interests at stake. The reliability and cost of
electricity service are important issues for attracting and holding
business and industry. As a matter of fairness, residential customers,
too, ought to share in the benefits of deregulation - of competition and
choice. It's surely time to experiment with more competition in this
region, at least to the degree the PSC has proposed.

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