When Cities Aggregate, watch your wallets

I always want to hold onto my wallet when I hear cities are gathering to do something to -- uh, that is "for" -- their citizens.

Yesterday, the Cities Aggregation Power Project (CAPP) held a press conference. Seems they want to feather their nest -- or someone's nest -- by getting into the electricity ratepayers' pockets.

Currently, the lowest available retail price for electricity in most parts of Texas is lower than the retail price for electricity before the beginning of competition, without even adjusting for inflation.

Texas is far too dependant on natural gas, the prices of which have been very volatile. Texas needs to diversify its generation mix and is working now to do so.

We lead the nation in wind power and have more wind-generated megawatts in this state than in almost anywhere else in the world. But we need coal and other sources to diversify our generation mix and to get additional generation online in a hurry.

It appears CAPP is interesting in serving cities, not ratepayers. The CAPP material states they want to aggregate citizens and "allow" them to opt-out (rather than opt in) and they also advocate becoming Municipally Owned Utilities. Isn't this the real agenda for CAPP? To allow them to become munis (which are not subject to competition).

Someone on a newspaper blog write:
I think there's a lot not being said by CAPP. Cities already get lower prices by joining together for long-term contracts. I wonder who gets paid for negotiating these contracts. Is CAPP involved? Do they benefit? This story raises a number of questions. Maybe a better study would be to compare all rates in Texas -- municipals, co-ops, and investor-owned utilities -- to see if they all have risen because of natural gas rates.

It’s worth looking into.

But then cities which have municipal utilites "munis" aren't subject to competition and their ratepayers are captive customers. And the muni operations can't be compared to a private sector company. Many of us just think cities don't have any business being in the utility business.

Let's use the yellow book rule -- if it can be done in the provite sector, government doesn't need to be doing it.