Outlook: CU: Lack of national energy policy threatens industry

City Utilities is basically a customer-owned energy company, and an integral part of our state and national energy industry. The lack of a defined national energy policy has plunged the energy industry into total disarray, and we enter 2001 with a looming energy crisis that threatens the national economy, and ultimately, the customers of City Utilities.

We at City Utilities are determined in 2001 to continue to prepare our customers for the changes coming to our energy industry, and to use our nationally recognized stature and credibility to help shape those changes to the benefit of the people we serve. That means that in 2001, City Utilities must be on the cutting edge of technology, resource management and industry changes.

At this time last year, I correctly predicted that the year 2000 would see City Utilities continuing to be a strong, low-cost, high-quality, customer-owned utility, and a valuable and viable community asset for Springfield. I can now submit that during the past year numerous significant steps were taken by City Utilities, on behalf of its customers, to aid in sustaining the economic vitality and quality of life of Springfield.

Certainly, 2001 will pose many challenges for energy utilities all across this nation challenges that just a few short years ago would have been deemed unthinkable. City Utilities is committed to meeting these challenges and, in the course of doing so, to exceed our customers' expectations in 2001.

City Utilities takes pride in being a cutting-edge utility. Being on the cutting edge requires that decisions relating to the future of the utility's customers and the community be made months, if not years, before needs and potential problems are fully identified.

As an example, the Nuccetilli Pipeline, which became operational in 1996, was first envisioned in the 1980s. Last year the pipeline pumped approximately 4.6 billion gallons of water from Stockton Lake to Fellows and McDaniel Lakes. While much of the country, including Missouri, suffered from a severe drought this past summer, the long-range planning of the Board of Public Utilities effectively insulated our customers from water shortages of the magnitude experienced elsewhere in the Midwest.

Being on the cutting edge allowed City Utilities to anticipate the increased natural gas prices now being felt across the country, and to do our best to utilize professional procurement strategies and flexible billing options to mitigate, as much as possible, the negative impact on our customers. And, as the winter months continue, I would urge any customer of City Utilities having difficulty because of the high cost of natural gas, to contact our offices and allow us to be of assistance in finding a workable solution.

Being on the cutting edge also requires that warnings be sounded when necessary. The news in recent weeks has focused on the energy disaster in California, which was one of the first states to implement electric retail restructuring, or "customer choice." Clearly, California is an example of how not to provide customer choice.

When electricity prices in an already high-cost state are doubling and tripling, when the prospect of rolling blackouts is a daily occurrence, and when construction of badly needed electric generation and transmission throughout the nation is thwarted for a variety of reasons, something is seriously wrong.

Unfortunately, the growing national dependence upon natural gas as a fuel for electric generation may well have the result of consumers paying drastically higher prices for natural gas as a heating source, as well as electricity as a source of power.

It is my firm belief that what is needed now, more than ever, is a coherent national energy policy. Until elected and appointed policy makers are prepared to define national objectives and determine how best to achieve them, I fear the nation's energy prospects will get worse before they get better.

The long-range planning conducted by the board and management of City Utilities has been designed with the goal of protecting Springfield, to the greatest extent possible, from the disastrous events experienced elsewhere and, indeed, to position the community to continue to thrive and prosper. The additional generating capacity of the two combustion turbines of the new McCartney Generating Station, set to be operational by May of 2002, will help reinforce Springfield's strong economy.

As we enter a new year, my vision is that being on the cutting edge will continue to pay rich dividends for the customer-owners of City Utilities.

(Robert Roundtree is general manager of City Utilities of Springfield.)