New Ad Campaign on 'Reliability' is Absurd Attempt
To Muddy Electric Utility Deregulation Debate, Says IBEW

Group's Newfound Religion on Reliability Does Not Change Basic Fallacy of
Their Position, IBEW President J.J. Barry Asserts

WASHINGTON, May 17 /PRNewswire/ -- ``The current massive advertising campaign claiming that federally mandated electric utility deregulation is needed to improve the reliability of the nation's electrical grid is patently absurd,'' says John J. Barry, International President of the International Brotherhood of Electrical Workers.

The campaign uses the name ``Americans for Affordable Electricity (AAE)'' but is primarily paid for by Enron, a Texas gas and electric wholesaler that has been a major proponent of large-scale utility deregulation.  ``Forcing early deregulation actually created problems, so now this new ad campaign says accelerated deregulation is the best way to correct them.  That's an absurd statement and not likely to fool either policymakers or consumers.''

Barry said that outstanding reliability of the current system is a standard to which the future industry must be held. ``Since the Energy Policy Act of 1992, the IBEW  and like-minded consumer, industry and environmental organizations have said consistently that reliability is one of the key tests that must be met in any deregulation plan. Now the AAE is saying that only a blind leap into the vagaries of a wide-open market can ensure the proper reliability. That's like Lizzie Borden advocating long term care for senior citizens.''

Barry also notes that since 1994 electric utilities have been operating in a deregulated wholesale power market in which they can buy from and sell to other generating entities. In preparation for broader deregulation, utilities have in some cases merged and in other cases divested themselves of various aspects of the business such as generation. This has left some utilities vulnerable to manipulation by out-of-state power marketers during periods of peak usage. The brownouts and subsequent price spikes that occurred in the Midwest last year were a byproduct of the deregulated wholesale market and the machinations of some power marketers.

``To say now that abrupt, total deregulation -- so consumers can buy electricity directly from out-of-state generators -- will solve the problem is nothing more than a desperate, devious rationale,'' Barry said.

Opening up the electricity market to competition without addressing the evident and known problems could well lead to more brownouts in the future. Prior to 1994, few Americans had experienced a brownout because regulatory protections were in place, he noted. And so far, IBEW and its allies have been increasingly successful in keeping those reliability standards in place.

In many of the states that have passed restructuring legislation, IBEW activists have successfully pressed the issue of system reliability, which includes: regular maintenance schedules, sufficient available generation capacity, and an experienced well-trained workforce to perform this work and restore electricity service in the event of emergencies.

``We have seen examples of what happens to reliability when qualified workers are not there to maintain the system,'' said Barry. ``Utilities believe that to be competitive they must cut costs. In fact, the Federal Energy Regulatory Commission's figures show that employment in the electric utility industry has declined by nearly one third since 1990. Maintenance programs are slashed along with workers, so that when storms occur, getting customers back on line becomes quite a chore. AAE's newfound religion on reliability does not change the basic fallacy of their position.''

Consequently, Barry said, the IBEW will be pressing Congress to ensure that any federal legislation that is passed provides consumers and workers with safe, reliable, affordable electricity systems. According to the National Electric Reliability Council (NERC), our electricity system is already the most reliable in the world, ``and we're determined to keep it that way.''

SOURCE: International Brotherhood of Electrical Workers

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