New Jersey and Energy: Creating a Power Authority is a Bad Idea


http://nj.gov/bpu/pdf/announcements/2011/capacityissues.pdf

New Jersey needs more generating power and that energy should  predominantly be from green sources.

New Jersey also needs a massive program of conservation and optimization that is significantly cheaper than building new electric generation capacity.

What New Jersey does not need is another independent authority borrowing at will and prone to corruption, waste, and political patronage. Since New Jersey does not have a department of energy, the BPU, which is already a large government agency, can be upgraded to department level by legislative action (if necessary) and assume the task of expanding the generating capacity in the state and overall implementing a cohesive energy policy.

No more duplication of government agencies. We have enough of them.

The BPU report points out: “The Capacity Market is unlikely ever to approach the economist’s view of a competitive market structure in the absence of a substantial and unlikely structural change that results in much more diversity of ownership.”

If that is the case, if there is a quasi monopoly of generation and distribution of electricity, should we regulate the energy industry in New Jersey?

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One response to “New Jersey and Energy: Creating a Power Authority is a Bad Idea

  1. A regulated market with low barriers to entry will result in lower prices for consumers and greater stability for producers, a win-win situation. What must be avoided at all costs is selecting regulators from the regulated industry, this results in croneyism and a bad deal for consumers and suppliers trying to enter the market.

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