Governors upset
again about energy Southerners seek
Bush support in keeping control over
regulation JEFF
NESMITH Cox News
Service
WASHINGTON - Southern governors have
appealed again for President Bush's support in their efforts to
maintain state control over electric power regulation.
Led by Gov. Sonny Perdue of Georgia, governors in eight states
including the Carolinas wrote to Bush this week, complaining for the
second time this year that the Federal Energy Regulatory Commission
is trying to restructure the Southern power industry and is ignoring
state interests.
"As the chief elected officials of Southern states, we know best
how to protect Southern ratepayers and look out for the economic
interests of our states," they wrote. They appealed to the president
to "respect regional differences and protect Southern
ratepayers."
Southern officials have been warning for more than a year that
Pat Wood, whom Bush appointed chairman of FERC, is trying to
railroad them into accepting the commission's "standard market
design" idea of a national electric power wholesale market.
"We do not believe that we have a `broken' system that needs to
be `fixed' by FERC, or that we need FERC to protect our retail
ratepayers," the governors said.
A FERC spokesman said the commission, which regulates
electricity, natural gas, pipelines and portions of the oil
industry, agrees with the Southern governors in the wish "that the
South continues to enjoy a reliable supply of electricity at the
lowest possible price."
One of the ways FERC pursues this goal "is by promoting
nondiscriminatory competition in wholesale power markets," said
spokesman Brian Lee.
He added that the governors' letter "clearly shows that FERC is
not doing enough to reach out and effectively communicate its
policies and obligations, and we're going to redouble that
effort."
FERC's standard market design concept would separate the
operation of regional, high-voltage transmission lines from
companies that generate and sell electric power. Wood and his fellow
commissioners advocate creation of regional transmission
organizations to operate the transmission lines.
Wood says he just wants an efficient, reliable and transparent
national power system, in which market forces determine rates.
Without such a system, its advocates argue, companies that operate
generating plants sometimes favor their own facilities in moving
electricity to consumers.
But Southern officials, especially public utility regulators, say
firmly regulated state industries in which large power companies
control power grids and generating plants produce lower rates for
power users.
"We're not saying, `No, no and hell no,' " said N.C. Utilities
Commissioner Sam Ervin IV. "We're not saying FERC is inherently
wrong in some of its ideas. We're just not open to having them
forced onto us."
Ervin and other Southern regulators have warned that the standard
market design model, if imposed on the power industry in Southern
states, could lead to increased costs for businesses and
homeowners.
And they say FERC appears to be coercing formation of the
regional transmission entities in a way that illegally usurps state
power regulation authority.
The letter was signed first by Perdue, followed by Govs. Kathleen
Babineaux Blanco of Louisiana, Mark Sanford of South Carolina, Ernie
Fletcher of Kentucky, Haley Barbour of Mississippi, Mike Easley of
North Carolina, Bob Wise of West Virginia and Bob Riley of
Alabama.
It was the second letter Southern governors have written to Bush
this year, complaining that Wood was trying to take over state
regulatory functions. The earlier letter, dated Feb. 3, was not
answered by Bush, but by Wood. It was not immediately clear why
Arkansas Gov. Mike Huckabee, who signed the first letter, did not
sign this week's
correspondence. |