Problems for Captive Ratepayers in Nonunanimous Settlements of Public Utility Rate Cases

Abstract

Professor Krieger discusses the recent tendency of public utility commissions to approve nonunanimous settlements of rate cases without full hearings. With the rising interest in alternative dispute resolution methods and the pressing demands of increasingly complex rate cases, a number of public utility commissions have encouraged negotiated settlement of rate cases. In many instances, commissions have approved these settlements over the strenuous objections of consumer groups. Professor Krieger argues that in the current regulatory environment, the nonunanimous settlement trend poses significant dangers. The nonunanimous settlement process raises the risk that the burden of increased utility prices will be borne disproportionately by captive residential and low-income ratepayers. Professor Krieger concludes that requiring unanimous settlement is necessary to protect these less powerful groups