Proposed Power Authority Would Manipulate the Market

The House Environmental Resources and Energy Committee last week held a hearing to discuss legislation proposed in 2008 to create a Pennsylvania Power Authority to oversee the state’s electricity market. This new government agency would have broad and expansive power to manipulate the market.

The proposed authority would have the power of eminent domain over existing facilities and could force the construction of new power plants and transmission lines. The authority would also have the ability to tax private power plants.

The current restructured market places investment risks where risk belongs, in the private sector – not on taxpayers. Additionally, competitive electricity markets have improved power plant efficiency, and reduced prices. Controlling for the increased cost of natural resources, wholesale electricity prices dropped over 23% since deregulation.

The Pennsylvania Power Authority proposal would create a new taxpayer-funded bureaucracy to further increase regulation and ultimately electricity rates for all Pennsylvanian energy consumers. Other states experienced similar results.