- The Washington Times - Saturday, August 30, 2003

COLUMBUS, Ohio (AP) — Quick! How much of your monthly electric bill pays for firing up your coffee maker?

Generally, 25 percent of what Americans pay powers up sockets in homes and businesses. About 10 percent is used to send electricity along high-voltage transmission lines. The bulk, 65 percent, goes to building, maintaining and operating the hulking plants that generate power from coal, natural gas, nuclear fission or water.

Those utility bills may increase now that the nation’s biggest blackout has fueled arguments that the creaky electrical maze needs a $50 billion to $60 billion fix.

“It’s the old trickle-down theory,” said Robert Tongren, president of the National Association of State Utility Consumer Advocates, who also is Ohio’s chief consumer representative. “Everything that we pay for is a result of the costs that are incurred in creating and delivering the good or service.”

No one knows yet if a better transmission system could have stymied the Aug. 14 outage that investigators suspect began in Ohio and spread from Michigan to New York and into Canada, affecting 50 million people. However, power companies say the overburdened lines failed after electric surges exceeded emergency levels before the crash.

If more power lines are needed, utilities likely will charge consumers higher rates to offset expenses of modernizing the sprawling and antiquated grid, analysts say.

Opinions vary on the cost of making the increasingly interconnected grid that crisscrosses America more reliable. Many experts agree, though, that it will take more than the $3 billion a year utilities now pour into lines, towers and substations.

“We need to be spending $5 billion to $6 billion a year. If we were doing that, we would not have as much congestion on the system as we do today,” said David Owens, the executive vice president of the Edison Electric Institute, an industry trade group.

A major power grid fix would take several years, meaning customers would see small bill increases over time — rather than potentially big utility hikes that could come later if problems aren’t addressed now, Mr. Owens said.

Demands to fix the grid have intensified since the blackout. The National Commission on Energy Policy urged the Federal Energy Regulatory Commission to add charges on consumers’ bills to pay for transmission lines and for research aimed at better technology.

“Consumers will pay, one way or another,” said Jennifer Tripp, a transmission system analyst and the senior director of R.W. Beck, a Seattle-based engineering and management consulting firm.

She said the federal government could take the unpopular step of increasing taxes and mandating grid upgrades, but more likely, consumers will pay with higher electric bills.

Electricity rates vary, depending on the state a consumer lives in, which company supplies them power and how their electricity is generated — for example, by coal, which is cheap but dirty, or natural gas, which is pricey.

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