Dear New York Times Editor,

The September 4, 2007 article "A New Push to Regulate Power Costs" leaves readers believing that somehow markets, not monopolies, created the price spikes they are currently experiencing. Not true. A global energy market, coupled with a crude oil cartel, two natural disasters and utility regulations created during the Great Depression have passed along monopoly prices even in states that have deregulated. Recent government reports covering states that have allowed consumers to shop for lower price energy have found that in virtually every month competitive suppliers have beat utility prices despite world energy prices that have tripled since September 11, 2001.

Indeed, there is mounting evidence of consumer benefits from energy deregulation. A Cambridge Energy Research Associates study found $34 billion in savings for U.S. electric consumers. Additional specific examples of consumer benefits realized with the advent of energy competition include a savings of 16% between 1996 and 2004 for New York residential electric consumers. Likewise, Texas electric consumers saved $1,440 over the four-year period since energy competition was introduced. Residential and small commercial customers purchasing natural gas from marketers paid less than customers buying from gas utilities in Maryland, New York, Ohio and Pennsylvania over a four-year period.

Regulators can do more by empowering consumers with market-based pricing signals to encourage conservation and demand response - a modest 5% drop in peak demand can translate into $3 billion a year in customer savings. And, we have only begun to realize the product innovations such as renewable power that thrive in a competitive environment.

Competitive markets alone cannot force OPEC to lower world energy prices, but competitive markets together with coordinated demand responses, conservation, and new energy savings technologies may ultimately bring U.S. consumers cleaner, more abundant fuels at lower prices.

Craig G. Goodman, Esq.
President

The New Jersey Board of Public Utilities as well as the Maryland Public Service Commission requested that PJM's Market Monitoring Unit examine the performance of the markets underlying their Basic Generation Service auction and Standard Offer Service power procurements. The PJM Board decided to approve the NJBPU and MDPSC's requests and has directed the MMU to undertake the review. The PJM Board noted its reservations associated with such action inasmuch as it, "highlights the awkward situation of having the MMU conduct an investigation for a state regulatory body wherein the MMU, as a division of PJM, ultimately could sustain public policy positions that might deviate from those embraced by PJM and its Board. Although the MMU alone will undertake this investigation, and the MMU alone will be responsible for its own analysis and conclusions, this action nevertheless implicates PJM as an undifferentiated institution. It may expose the MMU, bearing the imprimatur of PJM, as a witness before state regulatory bodies. It exposes the MMU, and by extension PJM, to matters related to retail markets - matters arguably beyond the appropriate scope of PJM's charter. Finally, participation by the MMU, as an employee of PJM, likely will cast PJM as an advocate in a debate between various PJM stakeholder interests." The full text of PJM-NJBPU-MDPSC Correspondence is available on the NEM Website.