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Wednesday, February 04, 1998 By Brian O'Neill
The numbers are big, real big, so big you can't get a handle on them. We're talking billions.
With all that cabbage riding on this proposed merger between Duquesne Light Co., the high-rate power company, and Allegheny Power, the low-rate company, it's no wonder that men in nice suits made a show of force Downtown yesterday.
There's a twist this time, though. This time the suits are talking like populists. Business leaders are looking to call off the power companies' wedding, or at least save us from paying top dollar for the reception.
That's why lobby groups you never heard of, but sound darned impressive, sent people to make fiery statements before a big red STOP THE BAILOUT sign. The SMC Business Councils, the International Mass Retail Association, the United Homeowners Association and the Building Owners & Managers Association all want the plug pulled on this merger deal.
"Although the people in Pittsburgh were recently given the right by ballot to accept or reject a $700 million tax proposal," Jordan Clark, president of United Homeowners, said, "they have been kept in the dark about a $4 billion levy on their electric bills."
The state legislation, signed by Gov. Ridge, hurtled through Harrisburg "without meaningful debate or consumer input," Clark said.
Of course it did. Joe Ratepayer's eyes glaze over when terms like "stranded costs" and "return on equity" are tossed around. All Joe Ratepayer wants is for his rates to go down. We have a vague notion that deregulation of the power companies can do that.
These people were here to tell us we were being had.
They say we should not have to continue paying for a bad investment, Duquesne Light's nuclear power plants. Nuclear power might be a comedy in Homer Simpson's hands, but it plays more like tragedy in Pennsylvania.
Pittsburgh's utility bills are 54 percent higher than the average for regions our size, according to this newspaper's Benchmarks study. That not only hinders our ability to attract business, it drives up the cost of almost everything.
Yet so far, Joe Ratepayer has been sitting out this "Mother of all Deregulation," as one opponent called it. It's too complicated. Besides, the Allegheny Power customer already enjoys low rates; the Duquesne Light customer hears bills will go down after the merger. No little guy has time to see if rates might be lower still, except these Citizen Power people who organized yesterday's news conference, who right now are working out of their homes.
When this news conference broke up, Terri Glueck, manager of media relations for Duquesne Light, stepped forward to say opponents were trying to rewrite history. Legislators and industrialists supported the utility's nuclear expansion in the 1960s and '70s. Then came the Three Mile Island disaster in 1979. Regulations tightened. Expenses shot up.
The question remains, so what? Why should this merger include payment by ratepayers for every so-called "stranded cost" still on a utility's books as it moves to a competitive environment? As one opponent suggested, isn't that like Kmart asking for a subsidy because a Wal-Mart moved in across the street?
When Mayor Murphy and his arch-nemesis, the Allegheny Institute for Public Policy, agree on something, we all ought to pay attention. Both oppose this merger.
For more from those who want to pull the plug on this deal, call Citizen Power at 412-421-6072.
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