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Electric Deregulation: RUCO just wants all the facts

As the head of Arizona’s Residential Utility Consumer Office (RUCO), I have been following with great interest the thoughtful guest opinion pieces appearing recently in the Arizona Capitol Times regarding electric deregulation — both those in favor and those opposed.

There can be no doubt there are worthy arguments on both sides of the issue. But, as RUCO director, my sole responsibility is to protect the interests of residential utility ratepayers. So, in this debate over electric deregulation, other than the ratepayer, RUCO has no side to champion, no special interests to advocate for, no political constituency to please.

All we have is an unfettered mission to represent residential ratepayers. And, in pursuit of that mission, we are guided, not by rhetoric or spin or nuance, but by cold hard facts.

The Arizona Corporation Commission is also looking at the issue of electric deregulation, and those five commissioners also take their responsibility very seriously. They, too, seek the best direction for the future of Arizona ratepayers.

For some, deregulation sounds like a wonderful concept. We are all wary of the overreach of government in our lives, and the burden that overreach places on hard working people trying to balance their household budgets and their utility bills.

For others, deregulation sounds like a free market run amok, threatening to trample over the best interests of consumers in the name of profit and greed.

But, here at RUCO, our perspective is not to choose sides, but to uncover the facts.

We are well aware of California’s failures with electric deregulation. We are well aware that Arizona abandoned similar efforts more than a decade ago when questions about the wisdom of deregulation overwhelmed the answers.

This, however, does not mean the issue should not be re-examined given the changing times and changing economy.

That is why on Aug, 27, RUCO is convening a workshop to hear all sides. We’ve invited all the stakeholders, and the public, to come and listen to all facets of the debate.

This is an important time in Arizona. The issue of electric deregulation is likely to determine the future health of our economy and our ability to grow and compete in the global economy.

We have to get this right. If there are 100 variables to moving forward with deregulation, Arizona has to get each and every one of them correct. Failure here is not an option — as California has shown us.

We must have all the answers, and we’ve already placed on the table some critical questions:

One question focuses on whether retail electric competition is even viable in Arizona in light of a Court of Appeals decision where the court concluded that “….the Commission may not abdicate its constitutional responsibility to set just and reasonable rates by allowing competitive market forces alone to do so.”

Additional questions that need to be answered include: 

Can Arizona get more customer choice and rate options within our existing regulatory framework?

Should we introduce more performance-based regulation?

How can Arizona guard against market manipulation and consumer fraud?

There are many more questions such as these, of course, and because electric deregulation is among the most significant issues facing Arizona today, we must get the answers correct.

We hope all interested parties will join us on Aug. 27, in finding those answers. Please go to www.azruco.gov for more information.

Pat Quinn is director of Arizona’s Residential Utility Consumer Office.

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