Utility proposes some scheme that will increase its profits. Regulators schedule the required public hearings and maybe one will show up in your locale. The regulator sits at the front of the room and "listens" to the public comments while trying not to look bored. Earnest public ponies put forth time and effort to attend and speak from the heart, hoping they can say something that gets through to the regulator. A court reporter transcribes the comments into a written record that can be read by the other commissioners, or perhaps used as evidence when a decision is issued. I seriously doubt that anyone at the WV PSC even reads the public hearing record, and I've never once seen anything from a West Virginia public hearing used as the basis for any decision. Why? Because the WV PSC is the utility's dog, captive and controlled like any good pet on a leash.
The WV PSC is a captured, reactive regulator who prefers to follow a utility's lead to set policy. The WV PSC isn't a leader, it's a follower. Without a clear vision of its own regarding how utility policy should work in the best interests of the state, the WV PSC allows utilities to chart our course by merely reacting to utility proposals. While other regulators have clear policy goals and demonstrate leadership to utilities by setting the standards that shape utility proposals, West Virginia prefers to let utilities shape the regulatory landscape.
It shouldn't come as any surprise, considering WV's regulatory leadership. C'mon, the WV PSC is lead by a former utility lawyer who took direction from utilities for his entire career. Why would anyone think he'd become a utility leader when sliding through the revolving door from regulated to regulator?
The WV PSC believes its mission is to "balance the interests of all parties." It shouldn't be. As a fully regulated state, the WV PSC should be a utility leader. Regulation is the price utilities pay for the privilege of operating a monopoly for a necessary public service. Regulation is supposed to serve as a substitute for competition where none exists. If a utility cannot perform in the public interest, then it should lose its franchise privilege, allowing others to compete for the privilege of serving the captive customer base.
Instead, the WV PSC behaves as if we must keep the utility happy and healthy, and puts the utility's interests first in any proposal before them. The captive customers the PSC is supposed to protect become nothing more than chattel, used to support utility profits. The WV PSC doesn't care what the customers want, nor what is truly best for the customers. The WV PSC has become completely detached from the public interest, only serving political interests that the utility purchases.
Commissioner Brooks McCabe presided over last night's public hearing in Martinsburg, looking like a brave little puppy, absorbing public scorn over FirstEnergy's proposal to sell a failing asset into West Virginia's regulated system in order to bail out the company. He began the meeting reading a description of the case and giving an overview of the proceedings thus far. He mentioned over 900 comments in opposition to the proposal, balanced by something like 35 comments in support. The audience laughed. If it were all about balancing the interests of all parties, this case would be over.
The few brave souls who made comments in support of FirstEnergy's proposal were all motivated by money, whether it was as a contractor whose income depended upon future operation of a failing power plant, or some political creature dependent on campaign contributions and quid pro quo. And then there were the unions, rightfully concerned about the future of the plant employees, however misguided they were in where funding for power plant jobs would come from in the future.
FirstEnergy has owned and operated Pleasants as a source of profit. The hardworking men and women who have kept this financial asset of FirstEnergy performing for many years have done an admirable job. FirstEnergy owes them a huge debt for their faithful service. But FirstEnergy doesn't care about them, FirstEnergy only cares about profits, and Pleasants is no longer profitable. FirstEnergy owes its workers a soft landing and transition into other jobs of equal pay and responsibility. But FirstEnergy wasn't squirreling away a tiny portion of its profits over the years into a soft landing fund for benefit of its workers. FirstEnergy spent every last penny of the profit these workers created on other important things, like naming rights to a football stadium, or a corporate jet and tax planning services for its over-compensated executives. Now that Pleasants is no longer profitable, FirstEnergy and the PSC believe captive ratepayers should pick up the burden of supporting Pleasants employees and the economic contribution it makes to its community. But the ratepayers never shared in the profits from the plant when times were good, it is only after the profits evaporate that FirstEnergy wants to pass the cost burden onto captive ratepayers. There's no "balance" here either.
A regulator who was a true utility leader might put an end to ratepayer-financed corporate welfare. It would make the utility responsible for the failure of its asset, including the economic impact to its workers and the surrounding community. A true utility leader would chart a clear course for a solid energy future in the public interest for our state, and require franchised utilities to adhere to it or forfeit their franchise privilege.
But we don't have a true utility leader. We have a corrupted and captive utility follower.
Thankfully, there are stronger, smarter, policy leaders in other regulatory venues who also have authority over FirstEnergy's proposal, because the WV PSC is a lost cause.