FOR
IMMEDIATE RELEASE Contact: Jeanne K. Clark
March
25, 1998 412/421-6072
Pittsburgh, March 25 – Two
administrative law judges today agreed with Citizen Power and recommended that
the Pennsylvania Public Utility Commission (PUC) deny the proposed merger
between Duquesne Light (DQE) and Allegheny Power (APS). The judges also recommended that the PUC
deny both companies much of their requests for bailing out their so-called
“stranded costs,” the bad company investments which would have been passed on
to electric customers in the form of high rates.
“This is a major victory for us all,” said David
Hughes, Executive Director of Citizen Power.
“Citizen Power told the judges that the merger would be bad for
customers – and they agreed. We told
the judges that the “stranded costs” were inflated and would result in high
electric rates – and they agreed. We
told the judges that the purpose of deregulation was to help not harm, electric
customers – and they agreed. And we are
hopeful that the PUC Commissioners will also agree and accept the judges’
recommendations.”
In the merger case, the judges said the merger would
substantially increase the power of the companies, and would prevent customers
from benefiting from competition. While
refusing to agree to the merger, the judges did give the two companies 18
months to come up with a plan which would protect competition and customers and
still complete the merger.
On the Allegheny Power case, the judges refused all
but 16% of the proposed “stranded costs.”
On the Duquesne case, the judges’ recommended a number of cuts to
“stranded costs,” with the final amount still to be calculated. Of special note is the fact that the judges
specifically rebuffed Duquesne’s attempt to bill customers for the costs of the
Brunot’s Island and Phillips plants.
Prior to deregulation, electric companies were forbidden to bill for
such non-operating plants, yet Duquesne still attempted, without success, to
push these plants into their “stranded costs.”
“When Citizen Power began fighting the merger and
stranded costs, everyone told us not to bother – that we couldn’t stop the
Bailout; we little guys just couldn’t win,” said Hughes. “But today’s decisions show that you can win
against the ‘big boys’. We are stopping
the Bailout! And if PUC agrees, the
money will return to the customers, where it belongs.”
Citizen Power is a Western Pennsylvania public policy,
advocacy and education group that fights for consumers and the environment
through education and litigation. Since
the legislature’s middle-of-the night passage of the 1996 Electricity
Generation Customer Choice and Competition Act, Citizen Power has
represented the rights of consumers to lower rates and clean, safe power.
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