Facebook Twitter

DAVIS MAN WANTS LIMITS ON UTILITIES’ SUBSIDIARIES

SHARE DAVIS MAN WANTS LIMITS ON UTILITIES’ SUBSIDIARIES

A Bountiful businessman wants restrictions that would prevent utility companies from creating unregulated subsidiaries that then compete against private companies for service contracts.

David Christensen, representing TK Industries, told the Utah Committee of Consumer Services recently that utility companies, seeking to improve their profit margin, are creating non-regulated subsidiaries that have an unfair advantage over private electric contractors. This includes such offerings as wiring buildings, servicing meters and doing performance tests on equipment.Christensen said these utility-owned companies benefit from unfair advantages such as capitalization subsidies, use of the utility's credit rating to secure financing, use of existing administration, name recognition, image and customer referrals.

Joseph Ingles, committee executive secretary, said a letter with a similar complaint was recently received by the Utah Public Service Commission. He said the letter has been given to the Utah Division of Public Utilities for review and a recommendation. Ingles suggested that the committee table formal action on Christensen's request pending the outcome of the DPU study.

Committee member Guido Rachiele said there are other areas of concern regarding the impact utility actions are having on small business because of monopolistic control. He said he believes the PSC should take a close look at such activities. "I don't think it is proper for monopolistic companies to compete with private industry."

Christensen said Iowa recently passed legislation to restrict utility competition. He said similar action is being considered in about 25 other states and he wants Utah to join the effort.

Christensen, a former employee of Pacific Power & Light, which merged this past January with Utah Power & Light, created 130 spinoff companies to compete with private companies for non-regulated services. He said there are no regulations in Utah to prevent similar activities here.

Committee members said they would closely watch the DPU recommendations and push for formal review if it is deemed necessary.