By Sen. Greg Jergeson D-Chinook
The 2001 session of the Montana Legislature will reach its
midpoint of 45 days by the end of this week. The
Legislature will recess for four days at the close of
business on Friday, Feb. 23 and reconvene the following
Wednesday, Feb. 28. The 45th day includes a major
transmittal deadline in that all non-revenue and
non-appropriation bills that are going to pass must be
transmitted by the originating house by that legislative
day. Both the House and Senate have been working very hard
to meet that deadline.
In my first column for this session, I mentioned that
dealing with the consequences of utility deregulation passed
by the 1997 session would consume a major portion of this
session's attention. That has come to pass. Both the House
and Senate have appointed select committees to work on the
issue. The governor has appointed a special task force to
work on the issue. In an interesting reflection of the truth
of an old fable, all the Queen's horses and all the Queen's
men seem unable to put Humpty Dumpty together again.
The Senate Energy and Telecommunications committee has
reported out SB 243, the major Republican bill to deal with
electricity costs predicted to begin soaring for residential
and small business consumers in July, 2002. Heavily amended
in committee, the bill would make Montana Power Company the
state's default supplier. The Public Service Commission
would be required to set prices, not on a "cost basis" as
they have in the past, but rather on a "market basis." With
markets driven by California and other urban markets, this
scenario assures that energy prices will be uncontrollable.
I, along with other Democrats, am reluctant to support the
SB 243 on the floor of the Senate this week. Even the
sponsor of the bill, Senator Royal Johnson, R-Billings, is
unhappy about the condition of SB 243 as it has been amended
by the committee. His willingness to continue support for
the bill is only to maintain it as a vehicle for solutions
later in the session.
Another emerging idea this session is to increase the
wholesale electricity tax in order to subsidize utility
rates for Montana consumers. One version has that subsidy
being returned to residential and small business consumers.
The other would make that subsidy available to the large
industrial consumers, many of whom supported deregulation in
1997 and have now found it to be unbearably expensive.
Unfortunately, the latter approach still leaves residential
and small business consumers vulnerable.
Building new generating capacity has been touted as a means
to deal with the problem in the long term. The theory is
that greater supplies will ease the pressure on prices. That
ignores the fact the Montana already generates much more
electricity than we consume. Therefore, that supply should
already ensure reasonable rates in Montana. It doesn't
because the 1997 deregulation scheme threw us into the
condition of markets beyond our borders. In my mind,
additional generating capacity can only serve Montana
electricity consumers if it is dedicated to them at
reasonable rates based on "cost." However, SB 243 would
price that additional generating capacity on "markets,"
leaving us vulnerable to conditions beyond Montana's
Obviously, we are not "there" yet on dealing with this
complex issue. The last hal