(1)  When investor-owned utilities talk about ‘leveling the playing field' for
      America's electric power industry, what do they really mean? 

      Forget competition and equalize electricity prices throughout the country.
      Public power should raise its rates.
      Investor-owned utilities should lower their rates.

Highly efficient, non-profit, locally owned public power utilities typically charge up to 25 percent less for electric power than private, investor-owned utilities (IOUs). Unwilling and/or unable to lower their rates, investor-owned utilities are attempting to change the law in ways that could force public power to increase rates in the name of "leveling the playing field." 

(2)  Investor-owned utilities already serve 3 of 4 Americans — 75% of the electricity
      market. So, why are they so worried about public power?

      Competition is coming to the electric power industry and investor-owned companies are
      not cost-competitive.
      Investor-owned utilities are not worried about public power.
      Public power gets giant government hand-outs that investor-owned utilities can't match.

Competition is coming to America's electricity industry, and it will be tough for the IOUs to compete with public power utilities that charge up to 25% less for the same product. Moreover, public power serves some of the fastest growing commercial and residential markets in America — from California to Arizona to Florida to New York and many places in between. Private, investor-owned utilities have their eyes on those markets — but they just aren't cost-competitive. Hence the calls for 'leveling the playing field.'

(3)  Why are public power rates, on average, lower?

      Investor-owned utilities don't get big tax advantages.
      Public power has huge tax advantages.
      Public power is public — it's non-profit and locally owned.

Public power is frequently up to 25% less expensive than investor-owned utilities because of its public nature. In fact, a recently prepared discussion paper prepared for George Washington University by Professor John E. Kwoka attributes about 60 percent of the apparent price difference between public and private, investor-owned power to non-profit, public ownership. In other words, public power's customers are all "stockholders" whose "dividends" come in the form of lower rates.

Because public power utilities are, in fact, government entities, they are tax-exempt and able to issue tax-free municipal bonds to finance construction and expansion. (Public power utilities do, however, make payments in lieu of taxes. These payments generally are equal to or greater than what would be paid by a comparable investor-owned utility).

In fact, public power and investor-owned utilities both have tax advantages provided to help keep electricity rates as low as possible for consumers. The American Public Power Association (APPA) reports that according to a recent study by MSB Energy Associates, investor-owned utilities have received an accumulated value of $245 billion in tax breaks over the past 40 years, including $105 billion in 'deferred' taxes. Elimination of tax advantages for either public or investor-owned utilities would result in an indirect tax increase for America's electricity consumers.

(4)  Isn't public power's authority to sell tax-exempt bonds to finance construction
      just an unfair advantage in the marketplace and a rip-off for taxpayers?

      Yes, public power's tax-exempt bond authority puts investor-owned utilities at a
      competitive disadvantage without benefit to taxpayers
      No, public power's tax-exempt authority actually benefits consumers and leaves
      investor-owned utilities with plenty of fundraising options unavailable to public power.

Both public and investor-owned utilities bring unique and different advantages to the marketplace. Privately owned utilities enjoy a host of ways to raise funds — including the sale of stock — not available to public power. When public power utilities issue tax-exempt bonds, consumers benefit in two big ways:

(1) Municipal bonds are a quick way for public power to raise private funds. That leaves more public (tax) money available for schools, parks, roads, and other community projects.

(2) Because they are tax-free, municipal bonds can be issued at a lower interest rate. That helps public power keep consumer rates as low as possible.

(5)  Why doesn't public power simply raise its rates and make more money?

      Public power's rates are already so high that most customers couldn't afford to pay more.
      Because public power stockholders continue to vote rate hikes down.
      Public power doesn't exist to make money, but to provide service.

Unlike investor-owned utilities — which are answerable to stockholders who expect dividends on their investments — public power is non-profit. Public power's 'stockholders' are its citizen customers, who enjoy 'dividends' in the form of rates that are frequently up to 25% lower than for-profit, investor-owned utilities. Public power utilities exist only to provide customers with high quality, dependable electric power at the lowest possible cost. 

(6)  Should we 'level the playing field' by 'privatizing' public power, the way it's
      been done in Britain and other parts of Europe?

      Yes, the rest of the world — Europe and the former Communist block in particular —
      are privatizing their utilities. America should get in step.
      No, comparing America's utility industry with Europe's makes no sense. They are
      completely different.

You can't compare America's electricity industry with Europe. While Europe's activities are moving out of a long tradition of nationalization, America's electricity industry is already 75 percent investor-owned. Furthermore, privatization is no panacea. Polls show that British citizens, irate over higher rates and higher salaries for power executives, now favor re-nationalization of that nation's utility industry. Moreover, why would anyone even consider privatizing an American pubic power industry that is efficiently providing millions of people with electricity for substantially less than most for-profit, investor-owned utilities?