Michael O. Leavitt Center for Politics & Public Service

Project Prologue

Introduction

References

Electricity

During the Leavitt Administration widespread interest developed in introducing competition in the electric industry. In 1996, the California Public Utilities Commission and the California legislature deregulated California’s electric utilities. Unfortunately, the requirements they imposed virtually ensured failure. For example, they mandated that the utilities divest themselves of their generation plants and prohibited rate increases for residential customers. As a result, the utilities lost control of their costs, which skyrocketed, but could not increase rates to one of their large customer classes to recover their costs. By 2000, California’s largest utility filed bankruptcy and the California plan unraveled. The problem worsened when Enron, a large owner of generating plants in the region, withheld electric power from the market and dramatically drove up the price of power. Enron’s market manipulations only became evident after investigation, but the upheaval caused California voters to recall Governor Gray Davis and elect actor Arnold Schwartzneggar to the governorship. California’s troubles affected the entire region, driving up costs. In response, Governor Leavitt convened an ad hoc committee chaired by Ric Campbell, director of the Division of Public Utilities, to determine what could be done to increase power supply in Utah. The governor called together all of the (more…)

References

Natural Gas

HB 320 in 2000 General Session eliminated the Committee of Consumer Services. The bill was repealed in the first week of the 2001 session.

References

Telecommunications

In his State of the State address in the 1995 general session of the state legislature, Governor Leavitt encouraged change and innovation in the telecommunications industry. The governor’s vision was to develop and exploit the “information superhighway” to enhance education, healthcare, and commerce. In response to the governor’s challenge, Representative Marty Stephens sponsored H.B. 364, the Telecommunications Reform Act, which fundamentally changed regulation of telecommunications in Utah. The proposal was sweeping and required significant compromise from industry, regulators, consumer advocates, and policymakers. For the first time, Utah law allowed competitors to enter local urban markets to provide wireline services to Utah customers and mapped a course for U.S. West, the incumbent service provider, to compete. Immediately following passage of H. B. 364, competitors began applying to enter the Salt Lake City market. After a lengthy proceeding, the Commission issued the first competitive certificate to Electric Lightwave, Inc. in August 1996. In 1996, Congress passed the Telecommunications Act of 1996 to begin opening local urban wireline markets throughout the entire country. The federal legislation was compatible with the state act which allowed the Commission to consistently implement and apply both laws. In the ensuing years, the Commission established the rules and (more…)

References

Michael O. Leavitt Center for Politics and Public Service