The PSC regulates the rates and service standards and establishes the territorial assignments of the IOUs. The PSC has authority to establish territorial assignments of the electric cooperatives, but not their rates or service standards. The PSC has no authority over the municipalities which provide electricity service to the residents within their corporate limits. In 1996, the FERC promulgated its final rule promoting wholesale competition. In recent years the large industrial customers have become vocal about competition in the retail market.
Industrial customers are in a better position than residential customers to negotiate lower rates.
They may be able to find alternative fuel sources to provide their needs. They may be able to produce their own electricity. One of the major considerations in the location of a plant may be the electric rates. Industrial customers have more favorable load characteristics than residential customers, which allows the electric utility to make better use of its generating plants. A major contributor to the discussion of electricity competition is technological advances.