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modified at a national level before fair and open access can occur at the wholesale or <br />retail level. <br /> <br /> The Independent System Operator (ISO) is the preferred for ensuring that the <br />transmission system is operated in a fair and nondiscriminatory manner. The ISO must <br />be a strong organization, with the ability to order member utilities to generate, transmit <br />and build as necessary. The Independent Transmission Company (ITC) recently <br />proposed by NSP has the potential to create systemwide problems (in particular, the <br />abuse of market power as it relates to transmission access); it is designed to maximize <br />profits and is not necessarily in the best interests of consumers. In any case, because not <br />all entities could transfer assets to an ITC (even a truly independent one), ITCs would <br />still require an ISO for appropriate operation of the system. <br /> <br /> The current scheme of regulation will change dramatically as restructuring occurs <br />at the state and federal level. The ability of state regulators to govern rates paid by end- <br />users may devolve to minimal levels of review. For the time being, state regulators will <br />continue to have authority over local distribution, service and quality of service <br />questions', but the protections afforded ratepayers in the past will change and diminish <br />with retail competition on a national level. Furthermore, with respect to utility mergers <br />and acquisitions, active FERC regulation will be necessary 'to prevent a resurgence of the <br />large-scale, non-regulated monopolies which existed in the early part of this century. <br />Electricity, now a basic necessity,' must be kept available and affordable to everyone. <br />Ultimately, regulators must.decide how that goal is to be accomplished. <br /> <br /> With respect to distribution reliability, it will be impossible to predict the <br />problems that will arise with distribution under a customer choice environment. In a <br />profit-oriented, market-driven, competitive environment, privately-owned utilities will be <br />tempted to cut operations and maintenance costs. Costs are often cut by eliminating such <br />routine maintenance as tree-trimming, which increases the risk of power outages and <br />downed lines - service reliability and safety issues. Other cost-cutting methods include <br />closing service centers, or failing to bring in repair crews outside of regular hours in order <br /> <br /> <br />