The Honorable Robert E. Rubin
Secretary
U.S. Department of the Treasury
1500 Pennsylvania Avenue. N.W.
Washington D.C. 20220
Dear Secretary Rubin:
The Committee on Regional Electric Power Cooperation, which includes all the public utility commissions and governors' energy agencies in the 11 states in the western electric power grid, urges you to act to remove a major impediment to the creation of a competitive electric power industry in the West. As you know, the establishment of a competitive electricity market is a major energy policy objective of the Clinton Administration.
Specifically, we urge you to take the necessary steps to safeguard the tax exempt status of existing debt associated with the transmission systems of public power utilities that choose to participate in Independent System Operators (ISOs). The development of ISOs with full authority to operate the complete transmission system that exists today, including the facilities owned by both private or public entities, is essential to the creation of a competitive electric power market.
Prompt action by the Department of the Treasury on this narrow issue will enable progress to continue on the development of the three ISOs in the West without jeopardizing Congressional review of the larger industry restructuring issues. We concur with Senator Frank Murkowski that you need to act quickly "...where private use concerns may frustrate turning existing transmission assets over to independent system operators...." Failure of the federal government to act could significantly undermine efforts to create a competitive market in the West and deny western consumers the benefits of a restructured electric industry.
Sincerely,
Roger Hamilton, Chairman
Committee on Regional Electric Power Cooperation
cc: The Honorable Frank Murkowski
Donald Lubick, Assistant Secretary for Tax Policy