THE VIRGINIAN-PILOT
Copyright (c) 1996, Landmark Communications, Inc.
DATE: Thursday, February 29, 1996 TAG: 9602290275
SECTION: BUSINESS PAGE: D1 EDITION: FINAL
SOURCE: BY DAVE MAYFIELD, STAFF WRITER
LENGTH: Medium: 52 lines
Measures that would give Virginia Power and other electric utilities more leeway in setting rates and entering new businesses have cleared the General Assembly on lopsided votes - in spite of strong opposition from groups representing utility customers.
The state Senate on Wednesday gave final approval to the lead measure in a legislative package sought by Virginia Power. It did so by voting 38-1 in favor of an amendment attached to the bill earlier this week in the House of Delegates.
A spokesman for Gov. George F. Allen said the governor hasn't taken a position on the bills.
The lead bill gives the State Corporation Commission permission to let electric utilities negotiate special rate discounts with key customers. Right now, utilities have to charge every customer in a given class - industrial, commercial or residential - the same rate.
The measure also permits the commission to scuttle a decades-old policy of limiting a utility's profits to a predetermined range based largely on the company's costs.
Consumer groups and large industrial customers argued against the bill, saying it could help the state's electric utilities strengthen their monopoly and keep out would-be competitors.
But Virginia Power said the measure would help it cut costs, hold onto customers and improve the state's economic-development climate. To help reduce concerns, it agreed to an amendment on the House floor Monday that would keep utilities from hiking rates for their remaining customers when they give rate breaks to others. That helped the measure pass the House on Monday 79-18.
Two other related bills that also have cleared the legislature are:
A Senate bill, which won final approval in both chambers this week, that lets the State Corporation Commission levy a fee on any federal agency if one of the agency's installations in Virginia buys power from a utility in another state. This bill was prompted by an amendment that recently nearly passed Congress permitting military installations to shop for power. Virginia Power said an ``exit fee'' against departing customers may be necessary to cover its ``stranded investment'' in generating and distribution facilities.
A House bill, which cleared the legislature last week, that loosens restrictions on utilities going into new lines of business. Virginia Power agreed to water down the language after heating and cooling contractors complained that the utility was planning to invade their business.
KEYWORDS: GENERAL ASSEMBLY VIRGINIA POWER PROPOSED BILL by CNB