Should all utilities be publicly owned and controlled?

[flashbacck]

Originally posted by: dullard
This thread will just be filled with anti-government people who will spout their theory without data and without ever considering anything anyone else says. It is the sad truth about those types of people.

In most cases, governmental control is inefficient. Thus, it should be avoided in most cases. You don't want government control of stores, most industry, etc. But that doesn't mean it is bad in all cases.

Also, we aren't talking government control vs. a competetive market. It is government control vs a monopoly/duopoly. Thus, we don't get the benefits of true competition. We are comparing inefficient government to inefficient monopoly.

When it comes to utilites, generally the bigger the cheaper. Building an entire water treatment plant for a town of 300 is a huge waste; instead combine that town with other nearby towns and build just one plant.

If the choice is many private monopolies vs one large government utility, it'll be far more efficient and far cheaper to have the large government controlled utility. If the choice is many local utilities vs one large private monopoly, I'd choose the large monopoly any day.

The worst situation of all though, is to routinely switch from regulation to deregulation. Each time there is a switch (either way) the customers suffer.

I think this is a very good point.

 

[So]

Originally posted by: flashbacck

Originally posted by: dullard
This thread will just be filled with anti-government people who will spout their theory without data and without ever considering anything anyone else says. It is the sad truth about those types of people.

In most cases, governmental control is inefficient. Thus, it should be avoided in most cases. You don't want government control of stores, most industry, etc. But that doesn't mean it is bad in all cases.

Also, we aren't talking government control vs. a competetive market. It is government control vs a monopoly/duopoly. Thus, we don't get the benefits of true competition. We are comparing inefficient government to inefficient monopoly.

When it comes to utilites, generally the bigger the cheaper. Building an entire water treatment plant for a town of 300 is a huge waste; instead combine that town with other nearby towns and build just one plant.

If the choice is many private monopolies vs one large government utility, it'll be far more efficient and far cheaper to have the large government controlled utility. If the choice is many local utilities vs one large private monopoly, I'd choose the large monopoly any day.

The worst situation of all though, is to routinely switch from regulation to deregulation. Each time there is a switch (either way) the customers suffer.

I think this is a very good point.

But it's patently incorrect. It's a government controlled monopoly vs a monopoly with government oversight. There is a HUGE difference.

 

[misle]

Originally posted by: So

Originally posted by: UCDAggies
Private utility companies such as PG&E or SoCal Eddison need to make a profit for their shareholder so they have to charge more for energy. Public owned and operated companies don't make a profit, so they can be run more efficiently. I don't see why local governments aren't seizing control of private owned electric and other utility companies.

:laugh:

I work for a power company. Let me tell you, power companies' "profits" are so tightly controlled by the PUC (Public Utilities Commission) that we have to seek approval for ANY major project. Profits are existent but slim. By making power companies publicly owned, you take away all incentive to make the company efficient since you remove the need to make the most of that razor thin margin. Furthermore, you take away ALL oversight. A publicly owned company has to answer only to bureaucrats, not a distrustful public board and not a skeptical set of shareholders.

Sure, you can seize control of the power company, if you want to throw the sheep to the wolves and yourself to higher rates.

I also work for a power company and I completely agree.

 

[dullard]

Originally posted by: So
Come ON...

Like I said, some people in this thread will be adamant regardless of facts and regardless of the benefits of the other side. I posted a middle of the road post. Private has benefits and government has benefits. Private has drawbacks and government has drawbacks. Arguing with those facts (that both have plusses and minuses) is sheer lunacy. I don't debate lunatics.

Why don't you try posting some real numbers. Post the government utility prices vs private utility prices for a wide range of areas (ie don't cherry pick data). Then we can discuss it further.

 

[J0hnny]

Most of the people on this board do not know what they're talking about!!

Most, if not ALL, private utility companies are regulated by the government.

The public service commission (or whatever you call it in each individual state) caps the profits for private utilities.

In NY, the cap is usually around 11% profit and that's with extreme oversight into capital programs, billing, etc.

 

[So]

Originally posted by: dullard

Originally posted by: So
Come ON...

Like I said, some people in this thread will be adamant regardless of facts and regardless of the benefits of the other side. I posted a middle of the road post. Private has benefits and government has benefits. Private has drawbacks and government has drawbacks. Arguing with those facts is sheer lunacy. I don't debate lunatics.

Why don't you try posting some real numbers. Post the government utility prices vs private utility prices for a wide range of areas (ie don't cherry pick data). Then we can discuss it further.

Fine, but while I'm doing that I want a response to my argument, which I will quote below since you have a remarkable ability to ignore it.

I work for a power company. Let me tell you, power companies' "profits" are so tightly controlled by the PUC (Public Utilities Commission) that we have to seek approval for ANY major project. Profits are existent but slim. By making power companies publicly owned, you take away all incentive to make the company efficient since you remove the need to make the most of that razor thin margin. Furthermore, you take away ALL oversight. A publicly owned company has to answer only to bureaucrats, not a distrustful public board and not a skeptical set of shareholders.

Sure, you can seize control of the power company, if you want to throw the sheep to the wolves and yourself to higher rates.

You are a fool for saying that. I reiterate, if you put utilities in the hands over the government, all you're doing is taking away government oversight. A regulated monopoly is far preferable because the government generally takes an adversarial tack with the company. If you make them all fellow bureaucrats, do you think it'll be MORE efficient?

Come ON...

There is no good reason for a government monopoly -- the government's job is to oversee and regulate existing monopolies. If it's their fingers in the pot, there is no regulation. It's no different from you suggesting that we take away government oversight entirely.

and from misle:

I also work for a power company and I completely agree.

so stop being disingenuous and pretending that everyone else is being adamant and not listening to your argument, but you are a little saint who is completely open minded.

 

[J0hnny]

Originally posted by: misle

Originally posted by: So

Originally posted by: UCDAggies
Private utility companies such as PG&E or SoCal Eddison need to make a profit for their shareholder so they have to charge more for energy. Public owned and operated companies don't make a profit, so they can be run more efficiently. I don't see why local governments aren't seizing control of private owned electric and other utility companies.

:laugh:

I work for a power company. Let me tell you, power companies' "profits" are so tightly controlled by the PUC (Public Utilities Commission) that we have to seek approval for ANY major project. Profits are existent but slim. By making power companies publicly owned, you take away all incentive to make the company efficient since you remove the need to make the most of that razor thin margin. Furthermore, you take away ALL oversight. A publicly owned company has to answer only to bureaucrats, not a distrustful public board and not a skeptical set of shareholders.

Sure, you can seize control of the power company, if you want to throw the sheep to the wolves and yourself to higher rates.

I also work for a power company and I completely agree.

Wow, so do I!!

 

[dullard]

Originally posted by: So
so stop being disingenuous and pretending that everyone else is being adamant and not listening to your argument, but you are a little saint who is completely open minded.

I thought I addressed your situation already:

Originally posted by: dullard
The worst situation of all though, is to routinely switch from regulation to deregulation. Each time there is a switch (either way) the customers suffer.

Improper government control of a utility is worse than a privately owned utility. So, if that is the comparison, I'll side with you and go private. But that isn't the only comparison to make.

 

[So]

Originally posted by: dullard

Originally posted by: So
so stop being disingenuous and pretending that everyone else is being adamant and not listening to your argument, but you are a little saint who is completely open minded.

I thought I addressed your situation already:

Originally posted by: dullard
The worst situation of all though, is to routinely switch from regulation to deregulation. Each time there is a switch (either way) the customers suffer.

Improper government control of a utility is worse than a privately owned utility. So, if that is the comparison, I'll side with you and go private. But that isn't the only comparison to make.

So you're fine with taking away all incentive for the government to be a disinterested regulator of power rates and instead make them reap the profits of power production?

And again, you've ignored my argument, so I'll keep posting it:

Originally posted by: So

Originally posted by: dullard

Originally posted by: So
Come ON...

Like I said, some people in this thread will be adamant regardless of facts and regardless of the benefits of the other side. I posted a middle of the road post. Private has benefits and government has benefits. Private has drawbacks and government has drawbacks. Arguing with those facts is sheer lunacy. I don't debate lunatics.

Why don't you try posting some real numbers. Post the government utility prices vs private utility prices for a wide range of areas (ie don't cherry pick data). Then we can discuss it further.

Fine, but while I'm doing that I want a response to my argument, which I will quote below since you have a remarkable ability to ignore it.

I work for a power company. Let me tell you, power companies' "profits" are so tightly controlled by the PUC (Public Utilities Commission) that we have to seek approval for ANY major project. Profits are existent but slim. By making power companies publicly owned, you take away all incentive to make the company efficient since you remove the need to make the most of that razor thin margin. Furthermore, you take away ALL oversight. A publicly owned company has to answer only to bureaucrats, not a distrustful public board and not a skeptical set of shareholders.

Sure, you can seize control of the power company, if you want to throw the sheep to the wolves and yourself to higher rates.

You are a fool for saying that. I reiterate, if you put utilities in the hands over the government, all you're doing is taking away government oversight. A regulated monopoly is far preferable because the government generally takes an adversarial tack with the company. If you make them all fellow bureaucrats, do you think it'll be MORE efficient?

Come ON...

There is no good reason for a government monopoly -- the government's job is to oversee and regulate existing monopolies. If it's their fingers in the pot, there is no regulation. It's no different from you suggesting that we take away government oversight entirely.

and from misle:

I also work for a power company and I completely agree.

so stop being disingenuous and pretending that everyone else is being adamant and not listening to your argument, but you are a little saint who is completely open minded.

 

[dullard]

Originally posted by: So
And again, you've ignored my argument, so I'll keep posting it:

Could you once make an argument worth commenting on? If you did, then I'd comment on it.

So you're fine with taking away all incentive for the government to be a disinterested regulator of power rates and instead make them reap the profits of power production?

(A) You don't take away all incentives.
(B) It won't necessarilly be disinterested.
(C) I don't have a problem with governments reaping profits if that means lowered taxes.

We have five things here to consider:
(1) Privately owned.
(2) Privately owned with good government oversight.
(3) Privately owned with bad government oversight. This includes wasteful laws, regulations that add cost without much if any benefits, and the costs incurred by repetitive switching of the laws when governement changes every few years.
(4) Government owned with private oversight.
(5) Government owned.

You are saying #2>#5. I agree with that statement. I don't agree with all of the other comparisons you imply.

 

[UCDAggies]

In a public owned you do have over sight, the citizens. If the board members don't do a good job, then they won't win relection. They are elected like any other government official.

 

[UCDAggies]

Originally posted by: J0hnny
Most of the people on this board do not know what they're talking about!!

Most, if not ALL, private utility companies are regulated by the government.

The public service commission (or whatever you call it in each individual state) caps the profits for private utilities.

In NY, the cap is usually around 11% profit and that's with extreme oversight into capital programs, billing, etc.

But government owned utility companies don't make a profit. So they are cheaper for the consumer. Non Profit > For Profit.

 

[So]

Originally posted by: dullard

Originally posted by: So
And again, you've ignored my argument, so I'll keep posting it:

Could you once make an argument worth commenting on? If you did, then I'd comment on it.

So you're fine with taking away all incentive for the government to be a disinterested regulator of power rates and instead make them reap the profits of power production?

(A) You don't take away all incentives.
(B) It won't necessarilly be disinterested.
(C) I don't have a problem with governments reaping profits if that means lowered taxes.

We have five things here to consider:
(1) Privately owned.
(2) Privately owned with good government oversight.
(3) Privately owned with bad government oversight. This includes wasteful laws, regulations that add cost without much if any benefits, and the costs incurred by repetitive switching of the laws when governement changes every few years.
(4) Government owned with private oversight.
(5) Government owned.

You are saying #2>#5. I agree with that statement. I don't agree with all of the other comparisons you imply.

What the hell is "private oversight"? Do you mean "public oversight" which never happens when you have unelected bureaucrats?

Even BAD oversight is far better than none at all, which is what your #4 and #5 are...

I have never heard of a community w/o public oversight of a utility monopoly.
So you can really reduce it to two things:
1) Privately owned with an oversight committee that has an incentive to be adversarial WRT the monopoly.
2)Publicly owned with no real oversight.

You're right that there is some risk of the PUC becoming seduced by a utility, but I have never heard of it in practice. I've never heard of the PUC doing anything other than trying to cut rates as low as possible for political gain, and for the consumer that's generally a good thing. In any case, privately owned with oversight is INHERENTLY a more stable system than no oversight whatsoever.

 

[erub]

Originally posted by: Safeway
No, they are not a bad thing. Austin Electric offers some of the lowest rates in Texas. They charge half of what TXU charges in Dallas. Austin Electric is a city-owned monopoly, but that is great for the city and Austin residents. The city makes tons of money, and the residents save tons of money.

Austin Electric just cost Freescale Semicondcutor millions of dollars last summer with their outage. IN response Freescale was going to move to San Antonio which promised cleaner, more reliable electricity for their fab. Austin had to beg them to keep the fab..

 

[So]

Originally posted by: UCDAggies

Originally posted by: J0hnny
Most of the people on this board do not know what they're talking about!!

Most, if not ALL, private utility companies are regulated by the government.

The public service commission (or whatever you call it in each individual state) caps the profits for private utilities.

In NY, the cap is usually around 11% profit and that's with extreme oversight into capital programs, billing, etc.

But government owned utility companies don't make a profit. So they are cheaper for the consumer. Non Profit > For Profit.

You really think bureaucrats with no profit incentive will be better? Remember the PUC sets an UPPER limit on profits, not a lower limit. The PUC routinely turns down rate increases for anything they think is unjustified, things that the company genuinely believes are justified for reliability.

 

[So]

Originally posted by: UCDAggies
In a public owned you do have over sight, the citizens. If the board members don't do a good job, then they won't win relection. They are elected like any other government official.

Most government bureaucrats are unelected. Show me a publicly owned utility with directly elected officers

 

[UCDAggies]

Originally posted by: So

Originally posted by: UCDAggies
In a public owned you do have over sight, the citizens. If the board members don't do a good job, then they won't win relection. They are elected like any other government official.

Most government bureaucrats are unelected. Show me a publicly owned utility with directly elected officers

SMUD is, my electric MUD. They are elected to 4 year terms, every congressional election 3 or 4 of them are up for reelection. Incumbants have never lost.

 

[So]

Plus, you guys are all against profits. What is wrong with a company making small, reasonable profits in return for its efforts? How are small profits fundamentally any different from AMD selling CPUs for a profit? If you are against ALL profits, fine -- but admit that you are advocating communism, don't dance around the issue. Oversight boards are there to ensure that the monopoly does not ABUSE its position as a monopoly.

Not only does this system ensure that you have a check on power (which many of you seem to want to remove). It also keeps that power out of the hands of the government. In a crisis, a corrupt government could easily abuse direct control of the grid.

On a macroeconomic scale, profit takes wealth that would otherwise be squandered on consumer goods and puts it into investment and savings. Good for the economy.
Corporate profit is taxed at a higher rate than citizens. Good for the economy.
Corporate profit is used to expand and improve the grid. Good for the economy.

being against power companies being private is shortsighted, selfish, foolhardy and dangerous to your long term financial position for hopes of a short term gain.

Furthermore, the cost of making a company publicly owned involves essentially having the government pay for the entire utility. Think about that. You have to buy the entire grid to make it publicly owned. Even at criminally low eminent domain prices, that is billions of dollars that you the taxpayer will have to lay out.

Sound like a smart move to me! :roll:

 

[halik]

Originally posted by: UCDAggies
Private utility companies such as PG&E or SoCal Eddison need to make a profit for their shareholder so they have to charge more for energy. Public owned and operated companies don't make a profit, so they can be run more efficiently. I don't see why local governments aren't seizing control of private owned electric and other utility companies.

You lack logic.
If you're not making profit, by definition you operate at lesser efficency than an entity that does make profit.

The same solution can be established (affordable electriciity) with subsidies while keeping the company private and efficent.

 

[So]

Originally posted by: UCDAggies

Originally posted by: So

Originally posted by: UCDAggies
In a public owned you do have over sight, the citizens. If the board members don't do a good job, then they won't win relection. They are elected like any other government official.

Most government bureaucrats are unelected. Show me a publicly owned utility with directly elected officers

SMUD is, my electric MUD. They are elected to 4 year terms, every congressional election 3 or 4 of them are up for reelection. Incumbants have never lost.

Sounds great to me! Incumbants, simply voted back in blindly are clearly better than private companies.

 

[dullard]

Originally posted by: So
I have never heard of a community w/o public oversight of a utility monopoly.
So you can really reduce it to two things:
1) Privately owned with an oversight committee that has an incentive to be adversarial WRT the monopoly.
2)Publicly owned with no real oversight.

I'm talking hypothetical, and you are ignoring those and talking what typically happens. If you keep ignoring the other hypothetical opportunities, I can see why we'll never get anywhere. One day, try streching your boundaries. If people never imagine what COULD be and are always stuck in what CURRENTLY exists, then we'll never progress.

I will disagree that a public owned utility will have no oversight. I believe there are plenty of non-profits and/or government controlled entities that work quite well and have oversight. Profit isn't a necessity for success. But that is a topic for another thread.

 

[JS80]

Originally posted by: UCDAggies
Bid difference in using ED on a small mom and pop, and on a big corporation. The corporation shouldn't have any rights to that land, even if they paid for it. Remember they are big and rich, and probably stole the land from a mom and pop shop.

Did you just take Marxism 101 at UC Davis?

Soviet Russia fell. Communism doesn't work.

As is, the utility companies might as well be government entities - they are highly regulated and have caps on profit margins. If you want cheaper energy, you need to deregulate and promote more power plants (including nuclear) so they can fight each other for business. Why don't we do this now? Hippies. Fvcking hippies.

 

[BrownTown]

Well, where I live we have the TVA which is the largest publically owned utility and it works jsut fine, TVAs rates are lower than the vast majority of the country (although this is true generally for most other southern utilities too). The fact of the matter is that electric generation, transmission and distribution are a natural monopoly. It makes makes absollutely no sense to have wires from multiple different companies running to everyones house and no sense to have multiple independant power grids for the same area. For this reason you can really only have one power transmission entity and one power distribution entity (these two could be the same or different, where I live TVA does transmission and has 159 distributers that sell their power directly to companies and people). Power generation is a little more open to competition, but there are still hige problems in that arena too which would benefit monopoly status and would mean competition is hurtfull. For one thing large power plants are EXPENSIVE, several billion dollars for a new coal or nuclear plant. For this reason only a very large company can build one without incurring massive debt. The problem is that in competative markets people don't build these plants but isntead build much smaller and cheaper gas fired plants. But of course electricity produced from a natural gas fired plant costs about 10-30 times what it does from a nuclear plant, so in the end the customers are getting screwed paying higher prices than if there was an intellegent generation mix as opposed to considerably overbuilt natural gas merchant plants. Due to these facts it is best for electric utilities (and likely gas and water but I don't know much about them) to be either government owned or very tightly government regulated monopolies.

At the very least if you are going to try to deregulate electrical utilites than you better have a very intellegently designed set of regulations to make d@mn sure that the customers aren't getting screwed in the end either by price gouging or loss of reliability (due to people being more concered about making money than actually keeping the power on *cough* ENRON *cough*).

 

[FoBoT]

Originally posted by: JS80

Originally posted by: UCDAggies
Bid difference in using ED on a small mom and pop, and on a big corporation. The corporation shouldn't have any rights to that land, even if they paid for it. Remember they are big and rich, and probably stole the land from a mom and pop shop.

Did you just take Marxism 101 at UC Davis?

Soviet Russia fell. Communism doesn't work.

As is, the utility companies might as well be government entities - they are highly regulated and have caps on profit margins. If you want cheaper energy, you need to deregulate and promote more power plants (including nuclear) so they can fight each other for business. Why don't we do this now? Hippies. Fvcking hippies.

dirty smelly tree hugging hippies, not just "regular" hippies

we need more slayer
:music:

Trapped in purgatory
A lifeless object, alive
Awaiting reprisal
Death will be their acquisition

The sky is turning red
Return to power draws near
Fall into me, the sky's crimson tears
Abolish the rules made of stone

Pierced from below, souls of my treacherous past
Betrayed by many, now ornaments dripping above

Awaiting the hour of reprisal
Your time slips away

Raining blood
From a lacerated sky
Bleeding its horror
Creating my structure
Now I shall reign in blood!

:music:

 

[UCDAggies]

Originally posted by: JS80

Originally posted by: UCDAggies
Bid difference in using ED on a small mom and pop, and on a big corporation. The corporation shouldn't have any rights to that land, even if they paid for it. Remember they are big and rich, and probably stole the land from a mom and pop shop.

Did you just take Marxism 101 at UC Davis?

Soviet Russia fell. Communism doesn't work.

As is, the utility companies might as well be government entities - they are highly regulated and have caps on profit margins. If you want cheaper energy, you need to deregulate and promote more power plants (including nuclear) so they can fight each other for business. Why don't we do this now? Hippies. Fvcking hippies.

This isn't communism. Some things should be own by private companies, such as toy companies, but electricity, gas, water, food, and other necessities shouldn't be private.