THE PRICE OF POWER

Does Price Matter? The Importance of Cheap Electricity for the Economy, January 1995 edition, a monograph prepared for the Western Fuels Association, 1625 M Street N.W., Washington, DC, 20036 by Mills, McCarthy & Associates, 6900 Wisconsin Avenue, Suite 700, Chevy Chase, MD 20815, provides an analysis that concludes that the delivered price of electric power in the United States will fall from its present average of 7 cents per kWh to less than 5 cents per kWh by the year 2010 (in 1992 cents).

This analysis includes the effects of competition, improved technology, fuel costs, and other factors including inefficiencies from government regulation and enviro agitation. It is at variance, however, with conventional belief that real electricity costs will remain about constant during the next 15 years. In an aside, Mills, et al., point out that 1980 Department of Energy predictions of real cost changes between 1980 and 1990 for electricity, coal, natural gas, and oil were for increases of 30%, 30%, 350%, and 90%, respectively, whereas the actual changes as of 1993 had been decreases of 10%, 10%, 10%, and 60%.

This is not to suggest, however, that the average American will always enjoy a better life as a result of these technological advances. Notes, a 133 page compendium of economic data, published by H. F. Langenberg, Smith, Moore & Co., 400 Locust Street, St. Louis, MO 63102, provides an exhaustive look at the other side of the power equation - government power.