In �The Gambler,� country-pop singer Kenny
Rogers� mega-hit from a few years ago (actually, in checking, �a few
years� translates to 26, as the song was released in 1978), he sang
lines that ring as true for policy-
makers as for serious card players. �You got to
know when to hold �em, know when to fold �em, know when to walk away,
and know when to run � .�
Those lines could well be applied to Virginia�s
General Assembly, as our delegates and senators consider what to do with
the well-intentioned but ultimately unsuccessful 1999 law that deregulated
electricity supply in the Commonwealth. This law was intended to give
Virginia�s citizens, from urban business owners to rural residential
dwellers, from Arlington to Zuni, the ability to choose their electricity
supplier. The hope of legislators was that existing and new competitive
suppliers would want to do business in Virginia, making offers to both
residential consumers and businesses, and that most if not all consumers
would be able to save money through the resulting competition. (As we�ve
been careful to point out, deregulation only applies to the electricity
itself; existing utilities would continue to deliver that electricity to
their customers, as always.)
But an unexpected thing happened on the way to
competition and choice. In three words, there is none. No competition, and
thus no choice. As outlined in last month�s editorial on this page
(�On Deregulation, It�s Time for a Direction Correction�),
Virginia�s retail choice law has become an oxymoron: There is
effectively no retail choice. And we do not believe there is likely to be
any choice for years to come, if ever.
Because there are no competitive suppliers, there
have been no savings to Virginia�s consumers resulting from
deregulation.
And while we certainly don�t have to flee, running,
from the deregulation table (to extend �The Gambler� theme here),
Virginia�s electric cooperatives believe that it�s time for the
Commonwealth to fold its cards, and walk away from the table, while we
still can.
In other words, we believe that it�s time to
suspend the 1999 deregulation law. We�re supporting legislation in this
session of the General Assembly that would do exactly that.
This legislation would involve several
elements. It would protect consumers by returning all
utilities to full rate regulation under the Virginia State Corporation
Commission, which for almost a century has done a good job balancing the
interests of utilities and consumers. It would allow the competitive
wholesale market to continue to develop, offering benefits to utilities
that could be passed on to consumers. It would allow retail pilot programs
to continue, in order to gauge what may work down the road. And it would
ask the General Assembly to revisit the issue in the future if it appears
that deregulation of electricity offers any benefits to our citizens.
It�s not just electric cooperatives calling for the
deregulation law to be suspended. In addition to Virginia�s 13 locally
owned electric cooperatives, the state�s second-largest utility,
American Electric Power, is supporting the effort, along with a wide array
of groups representing electricity consumers, from large industrial users
to small residential accounts. This coalition wants to protect the best
interests of Virginia�s
consumers by stopping an effort that is clearly not working, and returning
to a system that has worked very well for decades.
Only 16 states, including Virginia, still have an
electricity deregulation law on their books. Virginia has the lowest
average retail electric rates among these 16 states. Virginia is also the
only state in the Southeast to have such a law. There is not a single
success story among these 16 states, most of which are in the Northeast or
Midwest, where electric rates for years have been higher than the national
average. Our rates are lower than the national average. They have little
to lose by proceeding with deregulation, figuring their rates can only go
down. We have much to lose.
Three generations ago, rural people formed electric
cooperatives to provide electricity to areas where other utilities were
not willing to serve. Thus, from our founding, our incentive has always
been to protect consumers. And that�s our incentive now.
If cooperative members speak out with a clear,
unified voice on this issue, this legislative effort can succeed. And if
you speak out, you�ll be striking a blow for consumers as powerful as
that delivered by the residents of your area in the 1930s and �40s, as
they built a consumer-owned, cooperative utility that is still delivering
reliable, affordable electricity today to you and your neighbors.
Speak Out!
Last month�s edition of Cooperative Living
included a copy of our 2004 Virginia State Legislative Guide. If you
misplaced your copy, or need another one, you may download one at our
magazine�s Web site, www.co-opliving.com. Or you may call us at (804)
346-3344. Then, use the guide to get the contact information for your
delegate and senator. If you agree with what you�ve read here, then
please call them and simply tell them or their staff members: �I support
the electric cooperative position on deregulation.�
You�ll be striking a blow for consumers across the
Commonwealth. We�ll let you know the outcome of our legislative effort
in an edition of the magazine in the near future. Thanks for making a
difference.
