By Ron VandenBoom
Gary Feland, the Republican chairman of the Public Service Commission (PSC), warned the North Central Montana Pachyderm Club Friday that people should be careful and critical when listening to news coming out of Helena regarding energy and deregulation.
"Because there's some people that are really going to try and make some hay out of these challenges that are before us," Feland said.
The Democratic guns, even before the election, had starting to fire shots over the bow of deregulation, blaming the Republican majority for soon-to-be-felt higher energy prices. But Feland told the Pachyderms that it's not the Republican's fault.
"Deregulation was something that came down to us from the federal government," he said. "It was something we had to do."
Feland said he recognizes that while a lot of people would like to see us go back to the way things used to be, Montana can't turn back the clock.
"The separation of generation and delivery is done and sold," Feland said. "So there's no way we can go back. What we need to do is look to the future and deal with things the way they are."
Despite what Feland claims is Republican innocence in rising energy prices, he feels Democrats will color media releases in such a way as to paint Republicans as the bad guys of higher energy costs.
"The media is going to try and explain in 15 second sound bites a very complex issue," he said. "And I'm here to tell you they can't do it."
The challenge of deregulation and higher prices is something Feland said will take several years to work our way through and in many respects there is little the PSC can do to change what is inevitable.
"We do have say over how utilities are delivered and we will also make changes in how the PSC functions," he said.
This is the first time in 27 years the Republicans have been in control of the PSC and he told the Pachyderms, "change is in the air."
The PSC, he said, has already started conversing with the Northwest Power Planning Council, which provides direction on power issues for the four western states of Montana, Idaho, Washington and Oregon that are currently funneling power to California. The PSC has also entered conversations with Senators Conrad Burns and Max Baucus and with Dennis Rehberg, Montana's only congressman, in the hope that pressure pressure can be applied to the problem at the national level.
Feland said the legislature is considering a cap that will keep Montana's electric rates artificially low until 2007, but he acknowledges that this will not solve the problem.
Energy is now sold on the open market and the PSC is powerless to tell energy companies how much they can charge for the product or to whom they can sell it.
"It would be like confiscation to tell producers how much they can sell their product for," Feland said.
Much of the market today is found in California where energy needs continue to rise and shortages in production occur because there has been no new generation produced. Feland said he blames California's problems on conservation and environmentalist roadblocks that have made the state dependent on imported power.
Power that Montana is hard pressed to provide, due, Feland said, to bottlenecks in the western part of the state and Idaho that can only transmit so much power westward.
"The whole mind set has got to change," Feland said. "We have to be able to go out and drill, we're going to have to be able to use our federal lands, we're going to have to generate electricity."
Montanans will, in the meantime, see rising prices in natural gas and electricity, Feland said. But he predicted no black-outs for Montana. He added that farmers are also going to see rising fertilizer prices and propane prices.
The only recommendation Feland said he has for the legislature is to be careful during this period and not let fear lock the state into a long-term contracts to fix a short-term problem.
