August 22, 2007 3:23 PM

Montana Energy Regulators Challenge Bush Administration In Court

Following the brouhaha over SCHIP funding, it looks like the Bush administration has another state-based revolt on its hands, this one out of Montana:

"The Montana Public Service Commission said Tuesday it will join a lawsuit alleging the federal government made mistakes when it ruled that PPL Montana does not have monopoly power in Montana. Consumer advocates, and members of the PSC, have argued that PPL Montana holds a virtual monopoly over electricity production in the state. They say it is the single largest cause for higher rates seen in the state. Commissioners unanimously agreed Tuesday to pursue the legal appeal, saying PPL Montana's hold on electricity is the biggest issue facing Montana in the wake of deregulation that splintered the old Montana Power Co. 'I can't imagine anything that is more important than this particular issue,' said Commissioner Doug Mood, a Republican...PPL Montana successfully argued before the Washington D.C.-based Federal Energy Regulatory Commission that it does not hold a monopoly, allowing it to sell electricity at unregulated market rates rather than regulated rates...The consumer counsel said a ruling finding that PPL has monopoly power in Montana would immediately lower rates for customers."

So, to sum up: The Bush administration's federal regulators ruled that a monopoly energy company bilking customers in Montana is supposedly not a monopoly, and thus allowed to continue its profiteering. This ruling came down even though the bipartisan panel of state energy regulators agree that the energy company is a monopoly and thus should be subject to better regulation. Now the fight goes to federal courts. Stay tuned.