Since states are in the best position to use their knowledge of local or regional reliability concerns, any federal legislation must retain states' right to set additional standards appropriate to their bulk power systems. Emergence of fair and equitable competitive markets requires the identification and mitigation of market power abuses. The challenge lies in balancing the need to prevent and mitigate market power abuses without imposing federal dictates which might hinder the market s development and innovation. Federal legislation should allow states to continue their constructive work with FERC to craft mitigation strategies where potential market power problems are perceived. States must also retain authority over market power at the distribution and retail level, as well as full authority for siting of facilities.
Disclosure is essential for both informed consumers and effective market operations.
It will allow consumers to choose more environmentally benign fuel sources, such as renewables. Any federal action should encourage consistent standards for disclosure, but a federal mandate for uniform standards or a specific reporting format is not needed at this early stage of market development. States and markets should be given adequate time to cooperate in developing consistent disclosure requirements. States' authority to mitigate stranded costs, as well as provide for recovery mechanisms in state restructuring programs, must not be preempted by federal legislation. Any federal legislation should reaffirm the states' right to calculate and determine the appropriate recovery mechanism for stranded costs including non-bypassable charges to generate monies for recovery.