Dinnertime Calls Should Surge Soon

As the location for electricity generation becomes a matter of choice, fierce financial competition waits to erupt.

Arkansas and other states have elected to deregulate electricity generation, making room for competition and creating a new market. In three to five years the market for retail electricity providers will ripen, said William Lhota, president of energy delivery for American Electric Power. AEP recently bought Central and Southwest Corp., owner of Southwestern Electric Power Co.

Lhota compared retail electricity providers with long distance companies. Local telephone service remains regulated, as will the structures for power lines and electricity transmission. However, people choose their long distance provider, and by 2002, Arkansans will be able to choose the location for their electricity generation, too.

AEP, a coal-based electricity provider, serves 4.7 million customers in 11 states. The largest consumer of coal in America, AEP also became the third largest consumer of natural gas after merging with Central and Southwest.

After the deregulation, electricity will become a much larger business, Lhota said, adding that more than just electric companies will be interested in the deal.