Focus 580; Public Power and Utility Deregulation

This morning in the second hour of the show we will return to a topic that we have discussed before and I'm sure now and again we'll get back to it and that is the electric utility deregulation and we'll try to approach it and the whole subject of power generation from a direction that's a little bit different than we have done in the past. This morning we'll be talking about public power. And our guest for the program is Dr. Mueller. He is manager of communications and public affairs for the Illinois Municipal electric agency. It is a nonprofit organization made up of thirty nine municipalities in the state. The function of the agency is to provide a wholesale electricity to those communities and then they in turn resell them to their customers. We will be talking about the whole idea of public power as. And look at how it fits into the mix of power generation and provision here in the state. Questions are welcome 3 3 3 9 4 5 5 toll free 800 to 2 2 9 4 5 5. You have questions any point here you can give us a call. Mr.

Mueller Hello. Yes hello David are you. I'm good thanks and thanks very much for talking with us. My pleasure Congratulations on your 20th anniversary. Thank you. Let's talk about the some of the basics about the Illinois Municipal electric agency. Maybe I'll just ask as a general question again from the top to for you to talk a little bit about what it is. Sure. But it in your summary was was excellent. We've been around about 15 16 years now which is a much shorter period of time than the municipal electric utilities themselves but I'll talk a little bit about us and we can talk about public power district in the in the late 70s. Wholesale prices were were sort of spiraling out of control for these systems that by and large were either generating power from small plants themselves or buying power wholesale off the electric grid. The 1973 oil shocks. We're just one of the things that contributed to these increase in prices. The least the cities essentially got together and

said we want to provide power for ourselves. And to do so they had to get a piece of legislation passed or the General Assembly that allowed for our creation because there was there was no mechanism for them to actually work together through some sort of intergovernmental agreements. So we were created by an act of the General Assembly back in 83. The organization came together in 84 we began to sell our first power in 86 and we really came of age in the early 1990s when we purchased a portion of a fully scrubbed coal fired power plant down near Louisville Kentucky. Part of our power supply is made up by long term contracts with some investor owned utilities in the state and we maintain some small power supply plants in our member communities around Illinois. But essentially our only task is to provide the lowest priced power in an environmentally sensitive way and with

the most reliability to to our members and at this time of those 39 you mentioned we are selling power to 28 of the municipal electric systems in the state. And that works out to about 450 megawatts of power which is a it doesn't make US Commonwealth Edison but but it's pretty good size for us. Of the 39 members how many do some of their own generation. But the main generating municipality in the state of Illinois is Springfield. Springfield is the largest municipal system in the state. And it really is the only one that has committed to have enough generation on hand to provide for all of its own needs. If you've ever been to Springfield you will probably have been out by the lake. You'll notice that there is a power plant facility there well that is owned and operated by city water like power of Springfield. Most of the other municipalities either buy al of their

power off the grid or they may maintain a small amount of generation for emergency situations or for summer peaking. But but really Springfield is the only one that would think of as committed to provide all its own power for itself. Are the the the members. Are they places that had been traditionally had either been out there buying on the open market or had been doing their own generation or at the time that the agency came together. Were there municipalities that maybe for the first time were saying you know maybe we could do this ourselves. Yeah this is the only. All three of those things happens to be true the way you have some small municipalities city breeze Illinois comes to mind which is down not too far from St. Louis that had a

power plant sufficient in size to provide for that municipalities needs. But the fuel costs were beginning to get them and they they wanted to have these so called economies of scale where. They could come together with other communities by en masse. It's the same thing as buying tires for a trucking company. If a trucking company goes out and can sign a contract to buy a thousand tires it's going to get a better unit price than somebody like you and me that goes out and just needs one for the right front. So these communities came together and it's really this economies of scale by buying in bulk. Each of the units each kilowatt hours less is less expensive. So so really you had cities that were providing their own generation that decided that this was a good way to do it to to combine with other members. You had people that had done nothing but buy off the grid and were really sort of stuck with one supplier who wanted the flexibility of buying from sort of a larger pool. So

so really a little bit of all of that. And the the members are they some of these not only using power to do things like making sure that the street lights are led and public buildings are taken care of but then are they also providing power to residential users. That is that is indeed the definition of a municipality operated electric system. We can get into a little history here. The short answer question is yes. The city of Springfield actually provides retail service to industries commercial businesses and residences near you city of Rantoul and the City of Farmer city are both municipally operated electric systems and they say they buy wholesale power both of those happen to be purchasing members of our organization. They buy power from us that power is then resold to their end use customers over wires that the city phones and maintains and I think that's a

key point as we move through this discussion when you think about a municipal system. The municipality actually owns and maintains the. Holes the wires the Transformers the substations the generating units because some of these people do some of these entities do have generating units for the benefit of their citizens and and and without the profit motive. Entering into it because they also operate on a not for profit basis. I want to go ahead and say we don't have any problem with investor owned utilities which operate in a for profit basis I mean that is that is a legitimate and longstanding segment of the industry. We just do things differently and have done so for a long time. I didn't want to bore you a former city I believe has been the longest functioning electric municipal electric system in the state. They go back to about 1887. You will find that most of

these municipalities actually begin providing electricity around the turn of the century. Who are the industry had really she told you and Suzy to you know form that we see it now. Well maybe I should introduce again for people who might have tuned in guest for this part of focus We're talking with Dr. Miller. He's manager of communications and public affairs for the Illinois Municipal electric agency which as we have explained it's an agency It's a nonprofit that it's made up of 39 members of the its main function to provide wholesale electricity to those communities which they resell their to their end use customers and of these the only one that's really geared up to to be doing this on its own that is providing power on its own would be the city of Springfield some of the other cities may have some generation generating capacity and. If you have questions about the whole idea of public power we thought to be interesting we've been talking a lot about deregulation on the show in the last few weeks we thought would be interesting to examine this dimension of

providing power and why some cities do it and how it is that they do it. And of course questions welcome three three three. W. Weil toll free eight hundred two to two W while we do have a caller here. Then here's another question that I want to ask and maybe we could take care of that fairly quickly. And that is when you look at what people pay the rates that you charge say on average when you look at what customers of the for profit utilities are paying for electricity and there is a range and you compare that with what some of the customers that. Get their power from your members pay. How do things compare well averages are dangerous things you know little line about you know if a guy's got a foot in a bucket of ice water in a foot in a bucket of boiling water on the average he's comfortable but on the average we look really good. Our members provide power to anywhere up to

25 percent below the comparable rates of the investor owned utilities Now let me throw a caviar into them. As you know back in the 70s both Commonwealth Edison and Illinois Power built. Nuclear fire power plants and that was one of the reasons that their costs were higher than everybody else's and so our municipal averages looks. Very good compared to some of the higher cost systems we are still below even the lower cost systems which would be Amerind CIPA s and and so Co. But the margin is less for Amarin Simpson Soco than it would be Illinois powered comment about it. Commonwealth that is. But still. Last night a lot of that is due to the fact that they operate on an off for profit basis they essentially rather than return a profit to shareholders those profits are passed through to the customers as a unit reduction cost.

OK let's talk with this caller we have in Belgium line number four. Hello. Yes sir I was wondering there might be a little off topic but I think you would know as much if I decided that rum behold I found some way to suck electricity right out of the center of the ground right here where I stand and the people around my neighborhood I want to help them just rest in the nearby block or nearby countryside of one kind of person do that. I think the answer to that is yes under some circumstances. In the deregulation law 97 there are provisions for alternative retail electric suppliers. That is an entity that goes out and proven provides electricity to utilities customers over their utilities lines. This is when things get a little bit muddy here. I mean if you would put up your own rhymes you could start a utility company that would include you in your neighborhood.

You might be able to depending upon how the city of Elgin felt about you stringing new lines down the rights of ways I don't see that so that's another situation let me tell you have some municipal system started some municipal system started when the city decided that it wasn't happy with the service it was getting and we're really going back to the part of the century and they essentially did exactly what you said. They strung the second series of lines down the right of ways and they began to compete for customers door to door. What you're talking about is a little bit different there would I'm sure be some restrictions depending upon what your municipality decided was appropriate. But technically there is no reason that something like that wouldn't work. Obviously you'd have to cover all the safety aspects now in fact but you're right person there are a group of. Whatever could do that then if power could describe today we're going to stop using Illinois Power and start using your brother power.

It can and we have inquiries here. I would guess we get a half a dozen inquiries every year from municipality that are interested in creating a municipal system. There are new municipal systems being created in other parts of the country. But the problem is both economic and political. The two create a new unit simply operated system is expensive. You have to do one of two things you either have to enter in to negotiations with your existing utility to purchase their facilities most of of those companies don't want to sell. The city has to decide it's going to parallel build what you and I been talking about putting new facilities and compete door to door for customers both of those things require money because you have to do the studies and obviously you have to do the bonding or whatever financing it is to buy the facilities and put them in the field. It also takes a tremendous

amount of political will cause that that is something that the that the city fathers in this city mothers are going to be lobbied very heavily by your incumbent utility not to do that. So there's a political aspect there's a monetary aspect of the law. The last time a new municipal system was created in the state of leave was 1955. Oh and I was a little village of Greenup Illinois which is down in the central eastern part of the state. It can be done and it is done in other parts of the world. It is not easy. Thank you. Thanks for the CO. I guess that part of the reason for our thinking about this was it is looking at the fact that here in Champaign Urbana I believe that the franchise between the cities and the supplier here in my power is due to come up for renewal or expire or whatever in something like 15 16 years from now. For now and that if it's the kind of thing that you might want to think about Probably you want to start now

if not last week but I guess I do find myself wondering whether in fact given the realities today there is a certain point at which you would say the community becomes too big for this practically to happen. San Francisco is talking about it now. Their discussions have come out of the obvious difficulties California has been having in in the last few months. It is not physically impossible to do but if you do reach a dollar level at which it becomes more difficult because if you if you go out into your community and you look at the wires in the ground or the wires in the air the Poles the Transformers or if if you have underground facilities youll see those boxes in people's yards and those are the transformers for the underground facilities. Each of those has a

dollar value. All of the stuff you see you dont see has a dollar value running right back to the power plants. The incumbent utility will want something for those. And really we're moving into an era. Where Chan aeration. Transmission and distribution which are the three pieces of the electric industry are being separated and Illinois power for instance in the future is going to be a wires company it is moving that direction that means that it's going to make its money for its shareholders by the use of its wires. And it technically won't care. Who generates the electricity. I would think that Illinois power would be loathe to let go of wires that especially in a community like champagne Urbana where they probably will. Make good return on their dollar. Now it doesn't mean it's impossible. But as I say I'm I'm a big proponent obviously of public power. I think it

works but I don't want people to come away going oh well I'll go down to City Hall next week and we'll get this ball rolling. Sure it's it is practically a difficult thing to do. Well given the fact that as a result of this deregulation as you say we're moving away from the the the previous model the regulated monopoly model where one company dominated an area and they generated it they own the transmission line. They maintained them they took care of the building the building the servicing everyone company did everything. If we're moving to the point where these functions are going to be broken up then I wonder if a if for example say Urbana decided that they wanted to go into the generation business then why could they not. Why would they need to buy the lines if we're now moving to this point where essentially a lot of power is going to be renting them

so that you would just say well OK that will work out a deal with a lot of power to use the lines we don't have to buy them we'll just say we'll pay you for the use of them and we'll either generate the electricity will buy it someplace else at some point in the future. It could well be that the city of champagne will act as a broker and will broker an energy deal for delivery to its willing city. NS over Illinois powers lines that state so-called aggregation scheme where a third party entity acts as an agent for in particular residential customers is probably the only way residential customers are honestly going to see a break out of a deregulated industry because they will become part of a larger buy and combine which is essentially what we here at I am e a do for our member communities we go out and buy in bulk and deliver those savings to the to the individual customer. It could be in the future that the city of champagne will

put out a request for proposal to various power suppliers and and go out and sign up you know say the city of champagne will will broker an energy deal and you know for our citizens that sign up for this energy deal we will we're going to provide energy to you at x cents per kilowatt hour that voids the need to actually acquire the facilities now. It doesn't avoid a couple other things and when we talk about public power we tend to talk about the cost advantages and the cost advantages are real and we are obviously very pleased about that. There's one other big advantage about actually owning your own wires and that is that. The people who maintain those wires are in that city dedicated to that city. The city of Farmer city has. Winders. Their only responsibility is to maintain the system that serves

the people of Farmer city Rantoul is the same for Illinois is the same I could go down the list. Therefore. Public Power entities tend to. Be a more reliable deliverer of electricity outside the fact that the energy itself is less expensive. That is one thing that you won't get by some sort of aggregation deal for energy. You will still have the system maintained by whoever owns the system. And that can be problematic and one of the one of the advantages I think of municipalities that have their own power system enjoy is when it comes to economic development because you can't point to an industry you can you can take someone from the industry down to the garage where you have your bucket trucks and you have your line crews and you have the

expertise to keep that system up and operating. And those industries know those those are our guys. But they're they are meant just for us. And we're not going to have to call an 800 number and get people in here for maybe 40 50 miles away. So energy is an important component of this. You won't get the reliability component simply by buying cheap energy. Let's take another call here we have a caller in Peoria. The line for this morning. Good morning. Who owns the power plant in Sicily Eleanora. It's a slope mine that has coal down in there and they have a belt in the belt. They put the go around it is built and goes into the power plant. Tell me where Sicily is if you want to sorry to be ignorant. Tell me where Sicily is between Pawnee and then Sis. Then Tony. Ok I am not sure that may be a cooperative power plant down south of here

and I apologize I sometimes the toughest thing is to say I don't know but I really don't know. Are you interested in it from the technology standpoint. No but I used to live down in the Jays of Illinois when I was a kid and we had a power plant there on the South Fork River and they demolished that plant and then they built this one over there it's Sicily. Yeah I don't know who actually owns the Sicily plant and I apologize for that. You are going to find as these next years goes these years go on and this is this is the other side of the whole deregulation debate you talk about power plants being demolished coal fired power plants in particular are coming under increasing. Pressure from the environmental segment of the Illinois community and you're going to see it also I think legislatively and you could will see a number of Illinois coal fired power plants either be forced to refire with natural gas

or even to shut down because of the more stringent environmental regulations. And that is a concern to all of us as we look at having enough generating facilities in the state to meet our load over the next few years what I apologize I don't I don't know the particular answer to your question or rather what are they going to do with these nuclear plants understand that Illinois has 11 of them. My understanding is and I am not an expert on nuclear power plants is that most of these plants will be relicensed. I believe Commonwealth Edison did not relationship's Scion plant but most of these plants will be relicensed and they will do everything they can to keep those on line for another. A number of decades because right now they are in essentially at least as a point source. There are non polluting sources of electricity. I mean you still have to get around the waste removal problem. But but they don't create greenhouse gases they don't create any other

forms of air pollution and there are the costs of them are essentially sunk now so I think you're going to see that the owners of those plants do everything they can to keep them on line willing to the future. What about silicone Now silicone. We're in the back and I think 74 in this stock with $39. And then when they wanted to buy out the company they offered things people that bought stock at $13 see $3 a share. And people really jumped at it and now the cost of electricity and gas is about six times. The fires that were originally where gas is certainly a problem of course on your gas bill. The gas companies are allowed to pass on the cost of the of the commodity and the commodity has been very expensive. I believe silicone on the electric side is still relatively reasonable although in as much as

anybody uses natural gas now that that puts upward pressure on you or on your prices. But like many companies in Illinois of course Wilco has been purchased and they're now owned by an outfit called he s.. And and that's the that's the way of the future we have some concerns about about mergers because they're yours. You are concentrating the sources of generation in fewer and fewer hands and we worry that that will create fewer willing sellers in the future. But a lot of that is also beyond our control. So I hope that helps a little bit. Well I know because I sold my stock back to that company for only $3. I ended up coming out and banned it. Well that was a good deal for you then. Right yeah. OK. As for the call let's go to Farmer city for someone else right here lie number one. Hello. In response to the caller's question the plant that he was talking about by the way is actually just

to be Commonwealth Edison it can k now my next my question is is your organization sort of like a municipal version of our AAA and if so that how so or if not what's the difference that I have been with and thank you bet. Let's talk a little bit about the aria is there are there are comparisons that can be made. The rule Electrification Administration was created in the 1930s to bring power to rural areas and has done a magnificent job of that and I hope I'm right about this I think there may be 24 or 26 Arias in the state of Illinois in this since we are the same. And let's talk about municipal power and and and our Yes in this sense we're the same. Both are controlled by their customers. A municipal system is regulated by the political process. If if the people of Bree's Illinois don't like the way the utility is being run they

go to the polls the next time they vote that mayor out they get a mayor and it will do what they want with the utility. Our user member controlled and each member has a vote and they have meetings where the membership actually determines what the policies of the IRA are going to be. So in that sense we are the same. We are we are controlled by the people who actually use our product which is obviously different to an investor owned utilities who are controlled by their boards of directors and and eventually by their stockholders in the way that we function we are. We are a little bit different. You know my organization is only a wholesaler and and we sail to the cities which resell on the RTA side there are into these called generating and transmitting. So CA G and T's those would be like us they sell to the individual rural cooperatives who then resell that power so there are

parallels in many ways we are. Our mission is the same which is reliable power of the lowest possible cost and that that component of local control I can't overstate. We really believe that one of the reasons we've operated as efficiently as we have is that you have the citizens of the city looking over your shoulder the whole time. And if they want something done differently our mayors usually make sure that it gets done differently. You know our mayors there their phone numbers are all in the phone book. If the lights go out I can't tell you how many of them get that phone call at 1:00 in the morning go on a you know hours off down here do something about it. That's sort of direct input is I think one of the reasons we've been successful. I wanted to ask you to talk about what deregulation means for your members because as as we have discussed now a couple times recently on the show perhaps people are where we are in the midst of

deregulation of the investor owned utilities in the state it's result of a law that went into effect in 77. Part 97 Yes absolutely 1997 seems like. It seems like a long time ago. Well that's funny because you know what happened is that they're phasing in the industrial users the biggest ones went first and then next year the residential customers are going to go and it's funny because when I know we talked about this when it first happened and in 1997 2002 seemed you know who would you know worry about you know or about that later. Well now it's next year so it's it was they were about to have any right this week. This law effects the the the investor on utilities they have to they were made and they were mandated. Now for your members there I guess as I understand it there's a choice. If they wanted to they could. Do the same. They could offer the same

opportunity of to their customers that the investor go on utilities do to say OK choose your supplier supplier so what. What exactly does this mean and what do you think's going to happen as far as your members and deregulation go. But here's there are there are a couple of points here and first let me tell you what the law actually sets because there is a section of the law that specifically deals with discipline operated electric systems and with the cooperatives and the General Assembly acknowledged in the law that there was this component of local control that we just spoke about and that if the citizens of a city truly wanted to open their system then eventually that is going to happen. They also recognized however that our reason to function is a bit different in that we are service providers. We do not have deep pockets by and large we don't we don't have tremendous amounts of retained money that we can go out and do

huge promotional blitzes for. So they said we're going to let you folks decide for yourselves by an affirmative action of your councils whether or not you want to be involved in deregulation. That's step one. Let me let me tell you where I think most municipal systems are which is watchful waiting. Stranded cost recovery and I'm sure you've been through all of that stranded cost recovery runs out through at least 2006. The market we're not really going to know what the market looks like until 2006 when stranded cost recovery comes will. We have some concerns about. The. Making sure there's enough generation in the state that there really is a vibrant market. Our municipalities essentially taken this approach. It's not broken right now. Our costs are still low. Our level of reliability is still high. Let's see how the market evolves. We can always

get in. But if you get in and things go badly it's very difficult to reverse course. I believe you will find and I will not speak for them but I believe we believe you would find if you spoke to my colleagues at the at the rural cooperatives that their take is essentially the same although there there there has been one cooperative which has opted in. And that's that's over around Paris Illinois and they are selling to some people not inside their system and they are. Opening those comparable customers up within their system one of the problems that a municipality has been doing is. Is since they were set up. As not for profit entities to serve their customers. You almost end up with a philosophical problem which is do you take resources guaranteed or. That have been dedicated to your

customers and divert those in an attempt to sell that power elsewhere to make more money. Then what do you do with that money. And at what risk do you put your own customers so there is some philosophical questions involved. But the essence of it is that the option exists. If the it is my view that if the markets evolve and they evolve successful that you could will see in 15 years that the need for an organization like mine and I'm not trying to put myself out of business. But maybe the need for organizations like ours go away because you have a vibrant market and individuals will be able to buy power on the open market and they'll be happy. We're not sure how it's going to evolve. And so essentially the municipality's right now are sort of keeping their powder dry. Oh it seems to me that in that in that kind of environment you might feel that there was an even greater

need for a broker and. It might make me feel better if I knew I was dealing with someone who was a nonprofit entity. One of the things one of the things that we have found is that even when we do not end up selling power to a municipality and remember we we can we can sell power to a couple might my organization it's our power we can sell power to qualified utilities in other words we can do deals with Illinois Power and indeed we have in the hot summers a couple months ago we were actually selling some power to them because they were a little short in their in their control area. We buy from them I mean similar situations if we're short you know we can do short term short term deals and buy But essentially we're really set up to sell two to our municipal systems. But we recently had one of the municipal systems in the state come to us and their contract was coming due with their their current power supplier and their current power supplier they were under a very nice contract which had

gone back five years. Well the markets have changed significantly from five years ago and they were told they were going to see an 80 percent increase in their wholesale cost penalty. Now that's pretty significant. Especially because they would have to revise their retail rates. Their residential commercial industrial. Everything would have to go up to reflect that. So they came to us. We put together a deal. We provided that to them. They did not end up buying from us but they called us back and said that 80 percent went down to 40 percent and a 40 percent increase in wholesale prices over what they were paying is probably about where the market is now. So I your point about having an honest broker out there I think is is correct and that's one of the functions that we see for ourselves as is being this sort of benchmark where at least our members know that they can get it from us at x cents a kilowatt hour. And that's a good fallback for Webb.

Ten minutes left a little less on this part of focus We're talking with Dr. Miller. He's the manager of communications and public affairs for the Illinois Municipal electric agency. And we're talking about. Public power and utility deregulation questions welcome we have three people here will try to get I'm all for it. Let's go to Urbana line one. Hello I was wondering what incentive your customers in your situation have to conserve power because it seems to me that's one way for us all to get more power is if we are sensible about how we use power. Absolutely price pricing signals. Are very important and. Obviously the. The ideal world is one where you have an unlimited supply of electricity which is totally non polluting. That's just not the way the world is it's. What we're trying to do here is we try to acquire the most environmentally responsible forms of power generation we can.

Understanding that cost is a component of that. That's why we own a piece of a fully scrubbed coal fired power plant down in Kentucky. We my organization and we're relatively small potatoes in this market. Over the next year we'll be putting six million dollars into that plant is our share of their NOx abatement project. We're obviously bound by Illinois law and we we we will meet all of the Illinois Environmental regulations in terms of our generation. But what you bump into this conundrum and and the conundrum is people want cheap power. And when you. Properly price it. They often scream bloody murder. Now. You are correct that a proper pricing signal on a hot day in the summer is going to mean is that your your power on that is going to be more

expensive and maybe you could find a way to back off of that. It is my belief that as energy supplies tight and I do think we're going to see tighter energy supplies. Some of those pricing signals are going to have to have to be passed on to the end use customer and and that means that they're going to have to have the information. To make intelligent decisions about how they use power. In the hot summer a couple of months ago we didn't want to be on the market buying on a July afternoon because power was two or three thousand dollars a megawatt hour. You know it's components with a $20 kilowatt hour. I may be a decimal point but it's but it's expensive. So you know we were asking people look do your laundry at night or do those things you can put off it. Right. There will be a time I believe where you will see real time metering where someone can go to a. Panel on the wall and it will say

you run your washing machine now it's five cents a kilowatt hour. And in four hours it's going to be to send something like that. But people have to see those prices if they don't see the prices they can't it's in the end it's the end use customer that has to make those decisions right. Think you'll see that eventually. But it's it's been slow coming. I think we also need to use peer pressure on people and it's one thing for me to run my dryer in the evening it's another thing for me to when I walk into the big medical clinic in Champaign Urbana in the hot summer and everybody's dressed for winter because that looks more professional women in stockings than with the suit jackets on and the men in coats and ties and the temperature down to lower than it would be if in the winter time all of the customers who were using it irresponsibly too. And in my mind we think we need to say to these Hey I saw an interesting article along to send it in.

Maybe just as an age question but but it's something like that. Hotels in California now are beginning to an. Energy. Surcharge. And they are giving people a specific list of do's and don'ts. Don't leave the TV on when you leave your room which sounds like a normal thing to do but be surprised you know to only leave one light on those sorts of things. That's pricing signal and I think I think you're right about peer pressure but that's something that you sort of have to you have to pick up the phone and call somebody and say What do you do it that way but I will tell you that that big entities like that out there they'll see it in their pocketbooks too. And that may change there. Approach one track at least one more caller. West Peoria line for Hello. Hello. I don't mean to get you too far off topic but I was wondering if some of the members are branching off into other sort of telecommunications endeavors like installing cable systems or broadband Internet access. I had read an article where I

believe Muscatine had turned their power company into more of a telecommunications entity. So if you know anything about that please talk about it briefly I will. I don't know what is ahead of Illinois in the AP's number of Iowa municipal systems are involved in telecommunications. Illinois has been a little bit slower coming along. Some are beginning now to look at providing telecommunications options. City of Springfield recently voted to do a cable television study to see whether or not they should get into the business. A number of municipal systems because they have to deal with the dispatching and the balancing of power around the city have installed fiber optic networks which allow them to do that. The nature of a fiber optic network as I understand it is that there's often excess capacity on that. It could be that in Illinois it is going to be more likely that cities will install the fiber optics and lease them to willing suppliers. But the short

answer your question is yes they are looking at one more here or bannana line. To Hello. Yes good morning. Morning. I do admit I'm a very cynical person and when a cable company wanted to reorganize they called it deregulation and our cable company costs run up. So I ask myself why are these big men operating a corporation so eager to reorganize. And of course they sell it by Kering it the regulation. But why are they so eager to change from the old monopoly 50 times I can't believe it's generosity toward their users. It has to be our financial benefit for them. But you and I can give you about a minute I'll do a quick I'll do this very quickly. First off I have to tell you that I'm an unreconstructed monopolist when it comes to electricity. Until we can figure out a way to store electricity in large quantities it seems to me that treating it like soybeans we're always going to be at some

risk there. OK. Having said that that's my prejudice. Having said that the investor neutrals really did not want to see Dick deregulation but they were afraid it was going to happen in a manner that they would not be able to handle. So these are very smart people. They have crafted a bill that will allow their companies to continue to exist and flourish. But it wasn't that they wanted it. They've honestly had to figure out how to make it work. They simply saw the writing that it was going to happen anyway. But they are very bright people and their job is to make money for their stockholders and I believe that they will do that under a newly deregulated form. We're going to have to stop I'm certain though again these issues I will be talking about the more in the future but for the moment we'll have to leave it at that. We want to say thanks very much. My pleasure David it really has been fun and thank you. Our guest Doc Miller he is manager of communications and public affairs for the Illinois Municipal electric agency based in Springfield.