Saturday, February 27, 1999

Electric deregulation proves slow in Ohio

Speaker warns session may end without bill

The Associated Press

        COLUMBUS, Ohio — Time is short in the current legislative session to pass a bill that would deregulate the sale of electric power, House Speaker Jo Ann Davidson told an industry gathering on Friday.

        Ms. Davidson, R-Reynoldsburg, spoke to about 300 people at a conference sponsored by the Ohio Chamber of Commerce. She said lawmakers must act by the end of June, or the issue faces an uncertain future during the following 18 months.

        Lawmakers might not pass a deregulation bill during the fall session, when the focus is usually on less contentious issues, she said. And next year's elections will be the first under term limits, which will force about 50 lawmakers from the Legislature.

        “If you want to start the education process all over again, ... be my guest,” Ms. Davidson told the audience.

        Part of the industry — commercial and industrial users — has been telling lawmakers for years that electricity prices are too high and have been driving businesses to states that have plans for competition in place.

        The plan they are pushing, and the focus of bills that failed in the last two legislative sessions, would allow retailers besides utilities to sell electric power. The distribution and transmission networks would remain with utilities and would still be regulated.

        The utilities, however, want to make sure they're allowed to recover their “stranded costs,” the multibillion-dollar investments they made decades ago in nuclear power plants and other projects whose costs they now pass on in ratepayers' monthly bills. That would be impractical in a competitive market.

        The big consumers think the utilities should have to absorb those costs themselves.

        Representatives from all sides of the issue have been meeting in private with key lawmakers since August to work out their differences. Other sticking points include how energy is marketed to residential customers and how to replace school and local governments' revenue once the utilities' tax structure is changed.

        Ms. Davidson said a bill will be introduced in two to three weeks, giving lawmakers no more than 31/2 months before the June deadline.

        But the Legislature will have other priorities, including the two-year state spending plan that will be introduced in mid-March.

        But Ms. Davidson thinks the introduction of the deregulation bill could clear up some of the questions. Lawmakers who support different sides of the issue will have a better idea of what the parties have accomplished.

        Sam Randazzo, a lawyer for a coalition of commercial users, said legislative leaders must use their influence to get the process moving.

        “The job of leadership in the Legislature is defining public policy,” Mr. Randazzo said. “My personal view is that nobody's going to get 100 percent of what they want in the legislation.”

        Robert Snyder, executive vice president of the Ohio Electric Utility Institute, would not comment on the talks.


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