Supply and demand. The heart of our capitalist system. On one hand it’s great: our purchasing power can help to change the marketplace for the better. On the other hand: government regulations can interrupt our leverage as consumers.
The image on the left is a slightly modified Eileen Fisher ad. The original ad asks customers to buy clothes that are responsibly made and change the way business is done one purchase at a time.
Wouldn’t it be great if we had a choice of electricity providers? But, we don’t.
Electric utilities are often natural monopolies due to the expense to build and maintain the infrastructure currently used to produce and deliver electricity. Investor owned utilities (IOU), such as Puget Sound Energy (PSE), are beholden to their shareholders. IOUs are unchallenged monopolies, not held in check by normal market forces and that is why utility commissions regulate them. In Washington, the Washington Utility and Transportation Commission (UTC), a 3-person commission, regulates approximately 8,000 utilities and carriers.
By comparison, a public utility doesn’t need to be regulated by the UTC as their ratepayers are involved and provide oversight and direction thanks to legally mandated transparency. Public input is one big difference between public and private utilities. State laws regulate local municipal utilities through requirements for open public records, advance public notice, and public meetings.
PSE is the electricity vendor for Bainbridge Island. The city has a nonexclusive contract with them. We can’t change vendors to get off of fossil-fuel-generated electricity or become a public power utility without working with the local government. The Friends of Island Power (IP) campaign is working to educate the public about the benefits of public power and to see if the measure can get on a ballot in the future.
Currently, the island is getting a lot of attention from PSE. Their Vice President, Customer Operations and Communications has said in meetings: we hear you Bainbridge – you want greener, more reliable power.
Yes, that’s right, many islanders want greener, more reliable power. But, make no mistake about it, the only reason we have PSE’s ear is because Island Power has been running a campaign for more than two years threatening their business on Bainbridge, which is estimated at about $20,000,000 annually. PSE does not normally have town halls to answer ratepayer questions, especially not town halls led by the Vice President of Customer Operations and Communications at Puget Sound Energy.
A Benefit of Public Power
PSE’s campaign to remain our electricity provider has focused some people on the initial cost of buying the infrastructure and starting up an electric utility business on Bainbridge. While diverting people’s attention away from the fact that the money going to PSE each year would be part of our economy on the island instead. One benefit of public power is that an increase in electric vehicles would benefit our economy if we ran our own electric utility. (Watch a video of JJ McCoy, Senior Policy Associate, NW Energy Coalition, Seattle WA talk about the Benefits to Public Power from Local Transportation Electrification.)
A Benefit of Local Control
Did your electric bill go up this winter?
While PSE suggests you make home improvements or just turn your thermostat back to keep utility bills low (see graphic), Clark’s utility’s board of commissioners approved a plan that distributes about $10 million of 2016 surplus funds back to customers.
Clark Public Utility is giving customers a one-time credit on their March bill to help ease the financial strain caused by this especially cold winter.
“Long stretches of freezing temperatures took a toll in Clark County and we saw electric usage increase dramatically,” Clark Public Utilities Board of Commissioners president Jane Van Dyke said in a news release. “Staff came to the board and suggested using a portion of 2016 surplus revenue to help customers with these high bills.”
Not every public electric utility has a surplus, but every public utility has legally mandated transparency. That means that ratepayers are part of the process – every process and have a say in how their utility is run.