Caution is usually a good thing. But sometimes too much of a good thing can have unintended consequences. Take utility deregulation.

The Arizona Corporation Commission's refusal to let Qwest Communications enter the state's long-distance market is costing consumers millions of dollars in higher rates. And the ACC's cold feet regarding electric deregulation is about to hit hundreds of thousands of ratepayers in the pocketbook as well.

After a decade of rate cuts in anticipation of deregulation that was supposed to kick in at the beginning of this year, Arizona Public Service has announced a nearly 10 percent rate hike. Can Salt River Project be far behind?

APS' customers have enjoyed rate cuts totalling 16 percent since 1994 as the utility cut the waste and inefficiency that goes hand in hand with government regulation that guarantees a healthy rate of return on investment. In January, Arizona's electric utilities were supposed to buy half their wholesale power on the open market. Merchant power plants have been springing up like wildflowers after a monsoon rain to sell cheap, clean, gas-fired power to Arizona's utilities.

But at the last minute the Corporation Commission called the whole thing off, ostensibly to avoid the price spikes and rolling blackouts that hit California two years ago. The fact that Arizona's deregulation plan was far more sensible than California's apparently didn't matter. The commission simply wimped out.

Now, says APS president Jack Davis, "Like any other company, we've experienced significant increases in operating costs."

Actually, prices have been flat across the economy for the past year, though the energy market has been volatile. And a natural gas shortage looms on the horizon, yet that too can be blamed at least in part on government meddling. Arizona is at the mercy of a single gas pipeline, and investment in new pipelines is hampered by regulatory unpredictability.

Unless Congress and the Arizona Corporation Commission are willing to trust the marketplace and allow deregulation to proceed, we will almost certainly see rates rise and, quite possibly, shortages to boot.

Arizonans deserve better from a utility commission that gives the open market lip service but can't muster the courage to actually embrace it.