Perspective

New realities demand new direction from utilities.

 

To paraphrase Shakespeare, "The true soul of joy is in the process." For the utility industry, nothing could be further from the truth. The deregulatory "process" has not been joyful. It has been painful and costly. Perhaps equally disturbing, the process has compromised the reliability of the utility industry and has placed in question the judgment of its leadership, all of which is particularly troubling for an industry where "reliability" and "trusted leadership" have been widely regarded as the industry's hallmark characteristics.

Although operating reserve margins were once an indicator of reliability, undercapitalized entrepreneurs now frequently own generating capacity. The industry's transmission system, which has always been an invisible, dependable network of arteries for reliable supply, now experiences blockages and hemorrhages symptomatic of bigger problems facing us tomorrow. Where stable dividends were reflections of trusted leadership, bankruptcy and restructuring concerns now overshadow the public confidence. The failures have been well documented: California, recent blackouts, Enron, PG&E, AES, Mirant, and LG&E Trading. The list goes on and on.