10 Loy. Consumer L. Rev. 225 (1997-1998)
A Future of Green Power: Impact of the Electric Utility Deregulation in America

handle is hein.journals/lyclr10 and id is 223 raw text is: FEATURE ARTICLES
A Future of Green Power:
Impacts of the Electric Utility
Deregulation in America
By Christine Garcia

Introduction: A Foundation and
Background to Deregulation
Today, the deregulation of the electric utility
industry is sweeping our nation and has be-
come one of the hottest issues among busi-
nesses, economists, environmentalists, and
consumer advocates. Utility deregulation raises
different concerns and suspicions for these
high interest groups. Deregulation issues
include, but are certainly not limited to: tech-
niques used, opportunities created, and conse-
quences following. Although there are similari-
ties with the deregulation of the telecommuni-
cations and gas industries, this article only
addresses the deregulation of the electric utility
industry. Utility deregulation may connote a
lack of restraint in businesses; thus, it is also
referred to as utility restructuring, a less
chaotic term. Regardless of terminology, this
change in the utility industry will impact every
facet of our community.
At one time, electric utility companies had
been granted monopoly franchises to take
advantage of the cost benefits of centralized
production.1 In return, state governments
regulated these monopoly franchises which
provided consumers with electricity genera-
tion, transmission, and distribution.2 Thus, the
state had the right to regulate price and
quality of service.3 This relationship, between
the powers of the monopoly franchises paired

1998

with the limits of state governments, is now
taking different shape. State by state, legisla-
tures are deciding that it is time for change in
the utility industry.
The ultimate intent of the utility deregula-
tion is to open this once monopolistic utility
industry to competition. According to the
California Public Utilities Commission
(CPUC), competition will provide several
benefits, such as: 1) offering consumers
greater choice in purchasing energy services,
2) lowering rates, 3) stimulating technological
advances through competition, and 4) introduc-
ing performance-based ratemaking for the
remaining monopoly services.4 Several states
are presently in transit toward this new com-
petitive market. Some legislative bills which
Loyola University Chicago School of Law • 225

Christine L. Garcia is receiv-
ing her J.D. degree from Loyola
University Chicago School of
Law. She completed her B.A.
with a major in History and a
minor in Rhetoric at the Univer-
sity of California at Berkeley.
Her legal areas of interest are
broad, and include international
law, anti-trust litigation, and
intellectual property. She plans
on practicing abroad, and then
returning to the west coast.

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