The spectre of retail competition in electricity presents some difficult but solvable technical problems in creating new markets. It could lead to a new world of regulation. At the least, it will expose some currently protected utilities to potential losses that could prove substantial.
This prospect of losses has inspired some high-cost utilities to mount a formidable defense of the status quo, coupled with an aggressive offense to shape the transition. But in buying time, these utilities have not stopped simply at defining the agenda. No. By coining the "S" Word (ends with "tranded," begins with the letter between "R" and "T") and by creating the notion of a regulatory "Compact" (which guarantees a full recovery), these loss-threatened companies have cornered the debate with a brilliant strategy designed to minimize losses at the expense of others. They invoke the "Compact," while letting the "S" Word to the damage.
And here's the decidedly clever aspect of the plot: Once the "S" Word finds its way into everyday conversation, it will prove most difficult to eradicate.u1d
When Mother said never to use foul language, she might just as well have been talking about the "S" Word. It's offensive-particularly so as it rolls off the tongue of the regulator, in phrases that include such terms as "costs," "assets," "revenues," "investment," "benefits," "contracts," or "full recovery." Be fore-warned: Use the "S" Word and your integrity will be compromised. No one will respect you.
But more past the "S" Word and one can expose the vulnerability of the "Compact." Vociferous denouncement of the "S" Word is not nearly as effective as is a certain studied disregard, coupled with the use of the correct term.u2d