Interest groups struggle over electricity business standards

Interest groups appeared as far apart as ever on the question of setting national standards for electricity transactions during a meeting in Dallas on harmonizing business practices. A consumer advocate questioned the need for national standards, while a group representing businesses with operations in multiple states argued for them.


Pat Crow
OGJ Online

DALLAS�Interest groups appeared as far apart as ever on the question of setting national standards for electricity transactions during a meeting here on harmonizing business practices.

Consumer advocate Barbara Alexander, a consultant for the American Association of Retired Persons, argued against uniform business standards, saying such decisions should be reserved for the individual states, and �not a national forum that would allow 50 states to avoid doing their job.�

However, John Anderson, executive director of the Electricity Consumers Resource Council, representing large users with operations in multiple states, said his group feels it is increasingly important to standardize because �the electricity industry is in a state of mass confusion right now.�

But most speakers at the North American Summit on Harmonizing Business Practices, sponsored by the US Energy Department and the National Association of Regulatory Utility Commissioners (NARUC), agreed the increasingly deregulated electricity industry needs standardized business practices.

Still, they disagreed on whether the effort should be spearheaded by the Federal Energy Regulatory Commission (FERC), regional power authorities, or an industry sponsored board.

The Coalition for Uniform Business Rules has asked the Gas Industry Standards Board (GISB) to consider expanding its mission to cover retail gas and electric standards. GISB has examined the implications of such a change in its mission.

The Edison Electric Institute, the National Energy Marketers Association, and the Energy Power Supply Association have begun an effort to reconcile retail business practices for gas and electric markets.

Issued studied include customer switching and enrollment, customer information, billing and payments, load balancing, supplier licensing, dispute resolution, and metering.


Approaches argued

Burrell Kilmer, Baltimore Gas & Electric Co.�s director of supplier coordination and support, said, �There�s going to be a limit on how much you can harmonize business practices until (federal and state) policies are addressed.�

He said addressing the allocation of supply and price risk between the utility and the supplier, and vice versa, is still a big issue.

William Golove, a researcher at Lawrence Berkeley National Laboratory, said many interest groups were not represented in the process, particularly consumers.

But Anderson said differing standards are being set every day throughout the industry and an umbrella organization is needed.

Federal Energy Regulatory Commission Chairman James Hoecker has suggested that regional regulatory organizations (RROs) are needed to deal with state/federal electricity reliability issues.

Laurence Brown, an Edison Electric Institute attorney, said RROs could be the vehicle for business practices and reliability issues, since �they�re going to have to be addressed together."

He added agencies have the authority to exercise more regulatory flexibility and should use it.

�Regulations in the traditional scene are just not flexible enough to deal with a constantly changing market,� he said.

Philip Scalzo, vice-president of Williams Energy Marketing and Trading, said, �We need to be careful that when we create standards we�re not creating regulations, bureaucracy, and unnecessary steps and expense."

Philip Sharp, with Harvard University�s Kennedy School of Government, noted states and the federal government already are involved in electricity regulation. �Why insert a third layer in between?�

Sheila Hollis, an attorney with the Washington, DC, law firm of Duane, Morris, and Heckscher, said the approach to uniform business standards is obvious.

�FERC and the states don�t have the time or the resources to build this from the ground up. If we don�t turn to the electricity industry first to build these standards I don�t see how it can happen.�

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