OCR Text |
Show Currently Speaking7 By Moon Lake Electric Asso. Inc. THE HIGH COST OF REGULATION The cost of regulation has got incredibly in-credibly out of hand. No one really knows what that cost is, because not all of the ripple effects and indirect costs can be measured. But the cost is high and in the case of electric companies, according to a new study by the U.S. General Accounting Ac-counting Office (GAO), much of the cost can be blamed on what has been "little more than regulatory experimentation" ex-perimentation" in the last decade. The issue, of course, is not whether regulation is needed, but whether it is efficient and cost-effective. The GAO report, in exploring the effects of regulation on the power industry, in-dustry, seeks to trace what has happened hap-pened in the last decade. The 1970's brought a vast array of new environmental laws, expanded nuclear regulations, and statutes to protect worker health and safety. The utility industry now must report to more than 50 federal agencies not to mention throngs of state and local regulatory bodies. In enacting and implementing many of these laws, Congress, the states, and regulators frequently ignored the costs of the requirements imposed. The overriding intent was environmental protection at any cost. Recently, four power companies reported actual and estimated future costs of more and $1.4 billion to comply with rules issues by eight federal and various state agencies, plus annual recurring costs of more than $109 million. 4 These estimates represent only easily identifiable costs. Fully 80 percent of the costs were attributed to regulation by the Environmental Protection Agency and the Nuclear Regulatory Commission. The utlities reported spending nearly S.vxi million to comply with current environmental rules, and estimated that additional future costs would be Sl'M million. Although the new attention to cost-hrncfit cost-hrncfit issues is commendable, GAO says, little is being done to ease "the most common problems faced by the industry, such as obtaining permits, meeting environmental standards, and maintaining operational flexibility." In California recently, a ut ility was forced to obtain !'l permits from 43 agencies to Nnld one nuclear plant. This regulatory quagmire does not tide well for the future of a reliable elc.t trie ity supply What is needed, say G.V '. ib '"a balanced approach in rcgul.iti.ig the utility industry, so that the c.t and reliability of future power service are considered along with the environmental, health and safety concerns of the public." The nii-d for such a "balanced approach'' ap-proach'' has long lxen preached by pnwer company executives. They have insisted that the "public interest" means not only the cheapest possible power rates, or protecting of a threatened species, but also a reliable power supply |