Study Sheds New Light on Power Deregulation

More than 75% of the nation’s states would not benefit from deregulation of the electricity market in the short term if Congress tries to impose national guidelines to bring cheaper power to consumers, according to a new report. The report, by the Small Business Survival Committee, comes as Congress is considering legislation to overhaul the $200-billion electricity market and allow consumers and businesses to choose where they buy their power. Instead of Congress imposing a “one size fits all” federal policy, each state should be allowed to implement its own electricity restructuring plan to meet the needs of its citizens, the trade group said. Only 12 states would see short-term benefits from uniform federal restructuring of electricity because their power rates are high, according to the study. Those states, mainly in the Northeast, are Vermont, Connecticut, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island and Maine--and the heavily industrial states of Illinois, Michigan and California. Forty-nine states have considered reforming their retail electricity markets, and 13 states have put into effect plans to restructure their markets--steps that are prompting a burst of advertising. California’s plan is the most advanced.