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Let's be careful, stakes are too high
by Hobson Waits, Executive Vice President

A daily newspaper recently reported that I "emphasized the importance of answering all of the questions before we move forward with competition in the state." The quote is partially correct and was used to try to benefit the cause of those working hard to restructure the electric utility industry in Mississippi.

We do need to answer all questions before we decide whether to move forward with electric utility restructuring in our state. The stakes are too high to be careless in making the decision. I do not think it is inevitable that we will restructure an industry and risk what we now enjoy, low rates and reliable service.

We must first address whether restructuring is good for all Mississippians before we decide to plan the details of restructuring the industry. We don't need to get the cart before the horse.

There are many ways to answer the questions. One, presently in progress, is the study being conducted by our Public Service Commission. They have taken heat recently but they should be applauded for their efforts in handling this complicated issue. It cannot and must not be done overnight. The PSC has conducted very thorough hearings on a very complicated issue. There are no simple answers.

Testimony has been presented to the PSC in their hearings that Mississippi would have nothing to gain by jumping into restructuring before other states. There has also been testimony that our state will not be hurt or disadvantaged by observing what other states do and benefitting from their mistakes.

The PSC has kept a close eye on the actions of other states and the effect restructuring has had on them. And in some cases, residential customers are paying higher rates after restructuring than before. This was not what they were promised by the restructuring proponents. We will work with the PSC and the legislature to prevent this from happening in Mississippi.

Another place the questions can be answered is through the capable legislators who serve on the Mississippi Senate and House Public Utilities Committees. They can study all facets of the issue, review the facts, interview industry experts, and make a decision if we need to proceed with a plan. The legislative method of having issues studied by standing committees works well. This is the way the legislature works. I see no need to have a special appointed group that would only add another layer to the process.

The PSC and the legislature, through the committee process, are where this issue needs to be thoroughly dissected and closely reviewed before any decision is made. We should not pass a restructuring bill just because other states have or just for the sake of saying we have choice.

The primary piece of federal legislation (Rep. Joe Barton's bill) does not mandate that states restructure. In fact, it's careful to say that the decision should be left up to the states.

We must do what is right for all Mississippians, not only for those who stand to make larger profits. The electric cooperatives will work with everyone in the right way for the right reasons and for the right answers.

We answer only to our members of Mississippi's 25 electric power associations.

You flip on your light switch and instantly you light up a dark room at a rate among the lowest in the nation. But all that could change.

Publicity is mounting regarding the deregulation of electric utilities in Mississippi. Aggressive campaigns, mostly by large businesses and outsiders, have been waged by proponents to secure the right for customers to select their wholesale power provider.

These select groups encourage you to believe in a lot of uncertainties and sensational promises, such as lower residential rates and continued reliability in obtaining power. They are asking residential customers to risk a lot to benefit big business. Most of the benefits will lie at the feet of large industrial consumers.

Why change? Mississippi already enjoys available and reliable electric service at some of the lowest rates in the nation. Why risk reliability? Why risk low rates?

Legislation is certain to be introduced in the 2000 legislative session that could have a very negative impact on most of our members, the residential ratepayers served by electric power associations. We have regularly opposed any restructuring plans that don't benefit all classes of consumers. Appropriate safeguards would have to be in place to guarantee all customers would benefit from the legislation, both short-term and long-term. We will not compromise our stand. It is our responsibility to continue to offer you, our member, the best deal in the long run.

At this point no one really knows what the future will hold if the electric utility industry is deregulated. However, if history repeats itself, there are some things we can count on, such as what happened when the airline, telephone and cable television industries were deregulated. The deregulation of these industries has taught one clear lesson...not every customer gets treated equally or equitably. Has service improved? Have rates gone down? What about the new fees and taxes tacked onto your phone bill? We must safeguard this from happening in the electric utility industry.

We think the way we do business now is better. Your friends and neighbors think so too. Surveys of electric consumers tell us that electric cooperatives, such as electric power associations, are preferred over investor-owned utilities by a two-to-one margin. The people who work at electric power associations are the folks who care about the service you receive. They live in the same communities, attend local churches and have the same concerns about what's going on. As a group we have to question whether a utility conglomerate from outside the state will offer the same commitment and care.

These are important questions and ones that, without doubt, legislators and government officials will face during 2000. These questions should be answered only after all the facts have surfaced and we have guarantees in place to protect the ones with the most risk..the residential customers.

Changing the present electric utility system for the monetary benefit of a select group of large industries at the expense of others is not a game we need to play. This group is the one leading the cheers for restructuring. Its members are the ones that will be the winners at game's end, and most likely by a big margin.

Let me reiterate the electric power associations' opposition to any restructuring of the electric industry that does not protect the smallest business or residential customer from price increases.

Electric utility restructuring....it's a game Mississippi can not afford to play. It's a gamble we cannot risk. It's a change that is not good.

ELECTRIC POWER ASSOCIATIONS OF MISSISSIPPI
For more information e-mail Ron Stewart or
contact him at 1-601-605-8600.