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Utility Battles on in NW by Staff Capital Press - July 19, 2002

PORTLAND, Ore. -- Proposed changes to the Northwest electricity system would result in rate increases and duplicate California's failed energy restructuring, opponents told the Federal Energy Regulatory commission June 3.

The commission is considering tow changes.

One is to create a new "regional transmission organization" known as RTO West, which would take control of the region's existing federal and private power grid.

The other is to change how power prices are regulated and induce utilities to purchase electricity transmission rights on the open market.

Opponents said it would push trading into the short-term, price-volatile market and away from the predictable and low-cost long-term transmission contracts that have been the norm in the Northwest.

Northwest Power Works, a coalition including public utilities in Washington and Oregon, said it represented 1.3 million public power customers, many of them farmers.

The changes would also open the Northwest power system to the same type of market abuses that astronomically increased power costs and led to the California failure in 2000 and 2001, coalition opponents said.

Many Northwest consumers are already paying electric rates that are 40 to 60 percent higher than last year due in large part to California's failed experiment and manipulation of energy markets by power traders such as Enron, opponents argued.

If the proposed market restructuring occurs, they said, electricity rates in the Northwest could rise in the range of a half billion dollars annually.