Arizona Corporation Commission Holds Hearing About Legal Complications Of Electric Market Deregulation

September 06, 2013

 The Arizona Corporation Commission held a hearing to discuss the legal issues of deregulating the utility market. Lawyers on both sides of the issue addressed the commission.  Michael Grant, attorney for the Arizona Investment Council, argued against deregulation. He said deregulation contradicts the Arizona constitution which gives the commission the power to set rates.

“The commission shall have full power to and shall regulate rates to be charged by public service corporations,” Grant said. 

Grant said a competitive electric market would not be able to prevent rate discrimination or ensure customers a fair value. Nick Dranias, attorney for the Goldwater institute, argued in favor of deregulation. He said the commission was created as a ‘trust buster’ and allowing other utility companies to enter the market would ensure competitive rates.

“We are not going to get a perfectly competitive environment out of our system because of the constraints that do exist in the Arizona constitution but it is simply not true that we are a monopoly by constitutional design,” Dranias said.  

Dranias said the electric industry should follow the model of the telecommunications industry. The commission will consider the legal complications with future hearings.

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