From: Jean Ann Fox, Vice President
Virginia Citizens Consumer Council

Re: Electric Restructuring Legislative Proposals

Date: December 1, 1998

The Virginia Citizens Consumer Council opposes action on comprehensive electric restructuring legislation at the 1999 session of the General Assembly. The serious threshold questions of how to create an effectively competitive electric market and how to remove transmission constraints have not been answered.

Before the General Assembly considers legislation to do away with decades of utility regulation, the public needs strong assurances that the new structure will provide positive benefits and lower rates for all customers. Residential and small commercial ratepayers are at great risk of paying higher rates for less reliable service.

It is not necessary to adopt legislation in 1999 under the electric restructuring schedule adopted by the General Assembly in 1998. We do not believe that the SJR 91 Joint Subcommittee has sufficient time to draft a comprehensive restructuring bill before the 1999 session starts. There will not be time for statewide hearings on the restructuring legislation before Delegates and Senators would be asked to vote on a bill. The short session will not allow careful consideration of a comprehensive electric restructuring bill.

If the Joint Subcommittee decides to submit a bill, VCCC recommends the AARP Model Act to Restructure the State's Electric Industry and Provide for Consumer Protections being submitted today by the Virginia State Legislative Committee of AARP. This comprehensive model provides the consumer protections that VCCC has advocated during the SJR 91 deliberations.

VCCC recommends a separate bill to add standard consumer protection provisions to the public service company section of the Code. As telephone, gas and electric utilities are opened to greater retail competition, laws against unfair and deceptive trade practices that now protect consumers of competitive businesses should apply to these emerging monopolies. By cross-referencing this new section with the Virginia Consumer Protection Act, the enforcement tools available to the Attorney General and to individual consumers will be consistent with those that apply to other sellers of goods and services in Virginia. Consumer complaints could continue to be handled by the State Corporation Commission.

56-234.6 Prohibited practices by electric, gas, and telephone public service companies

(1) Any acts or practices committed by a public utility or other entity in providing, distributing, or marketing electric, gas, or telephone service using any deception, fraud, false pretense, misrepresentation, or any deceptive or unfair practices are declared unlawful.

(2) Any violation of this section shall also be a violation of the Virginia Consumer Protection Act, § 59.1-200, et seq.