John G. Colligan, EI-531Energy Information AdministrationU.S. Department of Energy1000 Independence Avenue, SWWashington, DC 20585-0650
Re: Financial Statistics of Major U.S. Investor-Owned Electric Utilities
Dear Mr. Colligan:
These comments respond to the notice published in Vol. 63, No. 139 of the Federal Register on July 21, 1998, with respect to the proposal of the Energy Information Administration to discontinue publication of Financial Statistics of Major U.S. Investor-Owned Electric Utilities.
The American Antitrust Institute is an independent non-profit organization whose mission is to advocate policies that increase the role of competition, assure that competition is fair, and challenge unduly concentrated power in the economy.
We oppose EIA's proposal. The Financial Statistics publication is the primary source for financial and operating information on investor-owned utilities. It is relied upon by antitrust attorneys and economists, in both the public and private sectors, to help construct the most realistic picture of how competition operates or may operate in the light of various mergers and acquisitions and regulatory proposals. It is perhaps most useful in the determination of the degree of market power that exists or may come to exist in a particular market. Even if the industry were to become fully competitive at the generation level-and this will not occur in all markets at the same pace-it is generally accepted that certain levels, particularly transmission, will remain non-competitive. Market power will be particularly important to understand in circumstances where firms are vertically integrated and may be able to leverage monopolistic power into competitive markets. Company-specific information is also important in addressing such public policy issues as stranded costs, energy supply, and wealth transfer.
EIA may argue that the data will still be available at the Federal Energy Regulatory Commission (FERC) from the original data source, the FERC Form 1. But the raw data is not easily accessible. It comes in the form of 200-page reports by each utility each year, and this data is not edited, compiled or verified. Without EIA to play its traditional editing role, the public will be left with incomplete data that has not been checked by any outside authority. Moreover, antitrust and competition policy analysis often employs time series research. If Financial Statistics is not published, data series that go back approximately fifty years will be available only to the few who understand how combinations of Form 1 schedules are transformed into the Financial Statistics format, and who have the substantial time necessary to individually replicate what EIA has been doing.
We are at a crossroads in the history of the electric utility industry, moving from a structure dominated by monopoly to one that combines elements of monopoly with substantial elements of competition. To handle this transition intelligently, we will need more and better information accessible to regulators, companies, analysts and advocates. For EIA to reduce the quantity and reliability of company-specific data would be contrary to the public's obvious interest at this time.
Albert A. FoerPresident