Consumers Union Cautions Deregulation Proponents on Exploiting Largest Blackout in U.S. History (Aug. 2003).

Blackout emphasizes need to better study deregulation's impact on system reliability

WASHINGTON, DC – Yesterday's massive blackout of the northeastern and midwestern United States and parts of Canada should serve as a wake up call for proponents of the misguided energy legislation now pending in Congress, according to Consumers Union, the nonprofit publisher of Consumer Reports.  Before the facts regarding exactly what happened and why are known, some are claiming that deregulation cannot be the cause.  Consumers Union urges a thorough investigation that includes all possible contributing factors - including deregulation.

"This regrettable event should not be a springboard to further deregulation under the misleading banner of 'modernization'," said Adam Goldberg, policy analyst with Consumers Union.  "True modernization is not about leaving the electrical grid to the whims of the market, but about making it work as a reliable public service," he added.

"Proposals pending at the Federal Energy Regulatory Commission (FERC) and in Congress could exacerbate infrastructure problems, not fix them," Goldberg said.
"A problem with deregulation is that it still is unclear who is responsible for making sure enough electricity generating, transmission, and energy efficiency resources are developed to prevent market manipulation and maintain system reliability," Goldberg added. "Electricity is just too important to leave these decisions to the deregulated marketplace."

"The number one priority of our country's energy policy should be ensuring that its rules minimize unacceptable price volatility and reliability risks for consumers. The pending federal legislation fails to address those issues,” Goldberg said.