Electrical pricing: Abuse of power
8:43 PM 3/13/04

Wisconsin desperately needs a more reliable and updated electrical power system, but a power consortium's awkward and unneeded pricing plan will cost Wisconsin households a lot more - about $200 million a year - than necessary. <

Such whopping price increases will strap families and hurt the state economy at a vulnerable time. It's no wonder that this wrongheaded plan has united Gov. Jim Doyle, business leaders and consumer groups. All urge federal regulators to delay the plan devised by the Midwest Independent Transmission System Operator, an Indiana-based nonprofit agency that manages regional power transmission. <

The MISO plan is supposed to improve electricity transmission throughout the Midwest. The problem, as Public Service Commission chairwoman Burneatta Bridge explains, is that the plan intentionally increases prices in areas where the electrical grid is congested or inadequate. By charging more, MISO officials argue that their plan would prompt states to improve transmission of electricity among utilities. <

But everyone already knows that Wisconsin's electrical grid needs about $2 billion worth of improvements, and the upgrades are on a regulatory fast track. Why pile on even more costs by penalizing power consumers for bad planning by utilities and regulators? <

Midwest ISO officials claim their revamp of the wholesale power market, once in place, would lower electricity rates overall. But the federal Department of Energy estimates that the plan will boost Wisconsin energy prices by 10 percent in the first five years. That translates to $200 million a year, Bridge says. <

That's not the only buck-passing. MISO, which manages transmission in all or parts of 15 states and Canada, is under pressure to come clean for possibly contributing to a massive, cascading northeast blackout last year. Rather than address the problem, officials are hiding behind an ill-conceived market solution that only charges you more for electricity that the multistate consortium cannot reliably deliver in the first place. <

Doyle has appealed to the state's congressional delegation and to the Federal Energy Regulatory Commission, which has jurisdiction over the plan. Price deregulation may well serve the Midwest power market in the long run, but lawmakers should pressure regulators to delay this plan's Dec. 1 start date, instead recognizing Wisconsin's good-faith effort to improve its outdated electrical grid. <

Wisconsin regulators already have approved nearly $3 billion in energy infrastructure projects in the past year, including a 220-mile power line from Duluth, Minn., to Wausau, and expansion of power plants in Oak Creek. The MISO plan would force Wisconsin households to absorb these costs, plus pay higher prices built into the new system. <

Rather than soak state consumers through unnecessary price manipulation, the feds should recognize that Wisconsin already is committed to delivering electrical power more efficiently and economically. <