DATE: Wednesday, November 19, 1997          TAG: 9711190483

SECTION: BUSINESS                PAGE: D1   EDITION: FINAL 

SOURCE: BY TOM SHEAN, STAFF WRITER

DATELINE: RICHMOND                          LENGTH:   60 lines

RESTRAINT ADVISED AS UTILITY RULES ARE REVIEWED

The chairman of Virginia's chief regulatory body urged caution Tuesday in the drive to dismantle state regulations of electric utilities and other lines of business.

In an economically robust era, it's easy to forget that many restraints on economic activity were written to protect the public from abuses, SCC chairman Hullihen W. Moore told a gathering sponsored by the Virginia Citizens Consumer Council.

``Some rules were imposed to ensure safety, fairness and reliability,'' said Moore, who described an unruly era when rival power companies once served their customers with overlapping wires and different voltages.

In its rush to dismantle the barriers that have separated providers of local telephone service, long-distance service and cable TV, Congress has created a jumble of new problems with The Telecommunications Act of 1996, Moore said.

``There will be years of litigation and confusion before the public gets the benefits of a free market in telecommunications,'' he told about 75 people attending the conference on consumer issues in Virginia.

Moore, a lawyer who practiced public utility and energy law before being named to the SCC, was one of three recipients of the Virginia Citizens Consumer Council's annual awards for service.

His admonition for caution when easing regulations of business activity comes at a time when the SCC and the General Assembly are trying to restructure the way electric power is generated and delivered in the state.

``One of the reasons why we're looking at this issue is to create a playing field that will encourage entrepreneurs,'' said Jackson E. Reasor Jr., chairman of a General Assembly joint subcommittee studying the restructuring of the electric-power industry.

``Some new technologies will result from deregulation,'' Reasor predicted during a panel discussion on electric utilities. ``I think they will be slower and fewer than in the telecommunications field.''

Like dozens of other states, Virginia is responding to pressures from manufacturers and other large users of electricity that want the freedom to shop for power and reduce their reliance on a single utility. Federal regulators already have opened the way for electric cooperatives and others to do such shopping.

A breakup of the industry into companies that specialize at generating, moving it long distance and delivering electric power to customers ``is going to happen,'' said Reasor, a Democratic member of the Senate from Bluefield. ``Do we stand back and let the federal government tell us how to do it in Virginia?''

``What has really brought it home to us are the industrial customers in Virginia,'' Reasor said. They said, ``We want you to look at this issue. It affects our bottom line.''

But the Joint House-Senate Subcommittee on Restructuring the Electric Utility Industry also has to weigh the impact of any changes on low-income households and rural customers, he said.

Earlier this month, the subcommittee received a detailed study of the electric-power industry in Virginia from the SCC staff. The subcommittee has scheduled a public hearing on the study's findings for Dec. 17 in Richmond.

``A package won't emerge from the General Assembly in 1998, but in three to five years you will see a major restructuring,'' Reasor predicted.

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