They say deregulating the state's electricity industry would increase power generation and improve the reliability of the system. But the much publicized instability of the deregulated California market has some Minnesotans skeptical of the benefits of retail competition. The deregulation bill proposed by the Minnesota Chamber of Commerce would usher in competition on the retail level, that means marketing directly to the consumer. Deregulation advocate and chamber vice president, Bill Blazar, says power suppliers would compete for customers much like long distance companies have since telephone deregulation. Under deregulation, independent power producers, rather than utilities, take on the risk inherent in open-market trading, and in exchange, stand to reap the financial rewards.
Critics note, however, that independent power producers can sell power anywhere in the world.
Minnesota currently has one of the lowest electricity rates in the country. Even the power industry isn't promising instant rate discounting in a deregulated environment. Electric Power Supply Association spokesperson Mark Stultz says the state's projected electricity shortage could skew results of even a well-planned moved toward deregulation. Nearly half the states in the country are debating retail choice or are in some stage of deregulation. Only a few states have gone through the entire process - among them are Arizona, Pennsylvania, and California.