2011 Critical Consumer Issues Forum
November 15, 2011
St. Louis, MO, USA
How should regulators and policymakers protect consumers from the rising costs of electricity? They shouldn't, according to PURC Director Mark Jamison. Keynoting the Critical Consumer Issues Forum (CCIF) in St. Louis, Missouri, Dr. Jamison explained that utility costs are increasing because of new environmental regulations, cybersecurity mandates, replacement of aging infrastructure, and natural disasters to name a few.
Higher costs, combined with a declining economy, make it increasingly difficult for consumers to pay for their electricity. Concealing this cost reality from consumers will only make matters worse because it cannot be sustained. This creates problems for regulation because the higher costs will lead to political pressures on regulators, which in turn increases political risks for utilities. The resulting spiral of higher costs, greater political pressure, and increased risk can catch regulators in a seemingly impossible situation unless regulators are willing to disappoint consumers, utilities, politicians, and other stakeholders, but at a rate that allows the system to continue to operate.
The 2011 CCIF was sponsored by the National Association of State Utility Consumer Advocates and approximately 250 government and industry officials were in attendance representing industry, regulatory agencies, and consumer advocate offices.