FERC to Utilities: Sell Lines

If you can't successfully deregulate energy markets, try, try again...or so it goes for the Federal Energy Regulatory Commission who is trying to take another bit out of the dereg pie:

U.S. regulators said Wednesday that they planned to change a policy that aimed to encourage electric utilities to sell their high-voltage transmission systems, saying the original policy led to too few divestitures.

In January 2003, the Federal Energy Regulatory Commission said it would allow transmission companies that are independent of utilities to charge higher rates for the use of their systems.

The agency, which regulates the rates, said the higher return would make owning the transmission lines more attractive and independent companies would be willing to pay utilities more to buy them.

The change proposed Wednesday would allow the higher rates even when a utility retains a stake in the transmission company, FERC Chairman Pat Wood said during a meeting in Washington.

The utility's ownership would be limited to 5% of voting control and 49% of economic interest.

The commission and Congress have offered incentives to utilities to sell their high-voltage systems, saying independent transmission companies will be more likely to invest in the electricity grid and allow power shipments by non-utility generators.

But does the move build any new transmission lines? Otherwise, what's the point?