When switching parties a few weeks ago, Rep. Kirk England (D-Grand Prairie) cited high utility costs as one reason for his dissatisfaction with the Republican Party.

“I am confident,” England told the Grand Prairie Times, “that the voters in our district want a representative who ... believes that the folks struggling to pay skyrocketing utility bills every month are more important than TXU’s profits.”

If only it were that simple!

The main cause of the price hikes isn’t politicians of either party; it’s an increase in the price of natural gas, which is the largest fuel source for Texas power plants.

Yet even to the extent one can blame state lawmakers, England’s swat at the GOP isn’t accurate.

Throughout the session, key Republicans such as Senate Business and Commerce Chairman Troy Fraser (R-Horseshoe Bay) spent most of their time attacking TXU and making its life miserable.

By contrast, Rep. Phil King (R-Weatherford), chairman of the House Regulated Industries Committee, tried to strike a careful compromise — correcting what many viewed as problems with the 1999 retail electric deregulation law, while not forcing the industry into bankruptcy, as California did.

In particular, lawmakers wanted incumbent utilities to compete more aggressively outside their historic service territories and put tougher penalties in place for violating market conduct rules. 

By the end of the session, it became clear that the preferred bill from TXU’s perspective was no bill at all. And the company worked both sides of the aisle.

Several prominent Democrats, such as former Dallas Mayor Ron Kirk, former Sen. David Cain (D-Dallas) and former Rep. Paul Sadler (D-Henderson), lobbied for TXU this session. The company agreed to put prominent Waco Democrat Lyndon Olson on its board. And the two private equity firms that purchased TXU cut a deal with Texas union leaders, agreeing to cancel the company’s plans to outsource certain union jobs.

As a result of these and other actions, the proposed buyout of TXU gained significant Democratic support, and House Democratic leaders engaged in a carefully calculated charade. Their actions were designed to make it seem they were helping the little guy.  The end result actually benefitted TXU and its purchasers.

During floor consideration of the utility bills, Democrats amended the utility bill to include several poison pill amendments, provisions that sound good — and are therefore hard to vote against — but have unintended consequences.

An example was Rep. Hubert Vo’s (D-Houston) plan to require utilities to count a payment as on-time if it is postmarked (rather than received) by the due date.

This sounds nice, but to enforce the Vo amendment, utilities, at significant cost, would have had to scan in the postmark of every payment received.

Because the amendment likely would have cost consumers more than it saved them, it was deleted by the conference committee.

Then, when the bill (SB 482) came out of conference, House Democratic Leader Jim Dunnam (Waco) called a point of order on it, killing it entirely. Publicly, he cited the removal of the Democratic poison pills, but in reality, the only people who benefited from Dunnam’s actions were TXU and its purchasers.

SB 482 wasn’t perfect, but it did tilt the electric market more in the consumers’ favor. It contained rate cuts for customers who haven’t chosen an electric provider, financial incentives for TXU to compete more aggressively, and tougher fines on electric companies that improperly manipulate the market.

Speaker Tom Craddick  (R-Midland) has taken many actions that are fair game for Democratic campaign consultants.  But his handling of TXU and the electric industry isn’t one of them.

Craddick is a long-time friend of Rep. Sylvester Turner (D-Houston), the utilities’ chief antagonist at the Capitol.

Craddick cast the eighth, and the decisive, vote in 2001 to pass HB 2107 — a rewrite of electric competition that was an anathema to the industry — out of committee.

Craddick has been a consistent supporter of the large industrial customers of utilities (including the oil and gas industry, which is powerful in his hometown of Midland). These companies are often at odds with the utilities.

If Kirk England wants to lower electric bills, he can do three things.

First, he can encourage his constituents to shop for a lower price. People who shop can save money, even in the current market.

Second, he can support more diverse fuel sources for generation, such as more coal and nuclear power plants.

And third, he can have a discussion with his new party leader. Dunnam and the Democrats had a lot more to do with the lack of legislative action on electricity this year than Craddick and the Republicans ever did.

Comments (1)

Comment	smaller | bigger
Name
Write the displayed characters
Subscribe via email (Registered users only) I have read and agree to the Terms of Usage.
	Add Comment