Editorial
Arizona Republic
January 31, 2003
A year ago we were heralding the planned deregulation of Arizona's wholesale electric market as a boon to lower rates and cleaner air. It was all supposed to kick in this month.
But Arizona's big utility companies warned of all sorts of unintended consequences, and around midyear a nervous Arizona Corporation Commission called the whole thing off. There wasn't much hue and cry because, after all, we want to do this thing right so we don't end up with California-style rolling blackouts.
Yet the longer we delay well-planned deregulation, the longer it will be before we enjoy the economic and environmental benefits. It's important that the commission doesn't waylay the whole idea.
Though there is some debate about whether or how much ratepayers would benefit, compelling evidence now indicates our environment would be healthier.
Arizona State University geography professor Martin Pasqualetti studied the effects of deregulation and determined it would speed up the retirement of dirty old, inefficient coal- and oil-fired power plants in favor of clean, efficient new gas-fired ones.
Pasqualetti was commissioned by TECO Energy Co., which is completing a billion-dollar gas-fired plant west of Phoenix. A company spokesman said Pasqualetti was chosen because he is highly respected in the environmental community.
The study's findings that the newer plants are at least twice as clean as the older ones aren't really surprising. Several large gas-fired power plants under construction around Arizona would fare quite well in a competitive wholesale market because they so efficient.
That they also are far cleaner is a nice fringe benefit.
But Arizona's utilities and their investors don't like the idea of sleek new plants competing with their old potboilers. Keeping competition out means they can continue making a profit from their old plants without making any big investments.
But competition ultimately is better for consumers - and savvy investors - than protectionism. And with clear environmental benefits also in the offing, it's time to get deregulation back on track.
