Public Utilities


Also found in: Dictionary, Thesaurus, Financial, Encyclopedia.

Public Utilities

Businesses that provide the public with necessities, such as water, electricity, natural gas, and telephone and telegraph communication.

A public utility is a business that furnishes an everyday necessity to the public at large. Public utilities provide water, electricity, natural gas, telephone service, and other essentials. Utilities may be publicly or privately owned, but most are operated as private businesses.

Typically a public utility has a Monopoly on the service it provides. It is more economically efficient to have only one business provide the service because the infrastructure required to produce and deliver a product such as electricity or water is very expensive to build and maintain. A consequence of this monopoly is that federal, state, and local governments regulate public utilities to ensure that they provide a reasonable level of service at a fair price.

A public utility is entitled to charge reasonable rates for its product or service. Rates are generally established according to statutes and regulations. The utility usually files a proposed rate schedule with the state public utility com mission for approval. The commission holds public hearings to help decide whether the pro posed schedule is fair. The commission may also require increased levels of service from the utility to meet public demand.

Until the 1930s public utilities were subjected to minimal regulation. The enactment of the Public Utility Holding Company Act of 1935 (49 Stat. 803 [15 U.S.C.A. §§ 79–92z-6]) signaled a change. A holding company is one that owns stock in, and supervises management of, other companies. The law regulates the purchase and sale of Securities and assets by gas and electric utility holding companies and limits holding companies to a single coordinated utility system. The law ended abuses that allowed a small number of public utilities to control large segments of the gas and electricity market and to set higher utility rates.

Public regulation of utilities has declined since the late 1970s. Public policy is now based on the idea that competition rather than regulation is a better way to manage this sector of the economy. Airline and telephone deregulation are the most prominent examples of this shift in philosophy. Telephone deregulation was enabled by a 1982 agreement between American Tele phone and Telegraph Company (AT&T) and the federal government. The federal government had sued AT&T, alleging that its monopoly on virtually all telephone service in the United States was illegal. AT&T agreed to divest itself of all local telephone companies, while retaining control of its long-distance, research, and manufacturing activities. This resulted in the creation of seven regional telephone companies with responsibility for local telephone service. Other companies now compete with AT&T for long-distance service.

At the federal level, numerous commissions oversee particular types of public utilities. These include the Federal Energy Commission, the Nuclear Regulatory Commission, the Federal Communications Commission, and the Securities and Exchange Commission.

Cross-references

Nuclear Power; Telecommunications.

References in periodicals archive ?
A clear definition of public utilities will result in greater competition, which should result in better quality services.
Therefore, the non-public production of public utilities has been popular since the 1970s, which stands for the development trend of service production field.
(157) However, a positive rights approach to public utilities often results in large general subsidies to these utilities and underpriced service because the right is interpreted or implemented as requiring low or no cost provision of at least some amount of utilities service to all.
"We consider the party presence of capable and worthwhile individuals in the boards of public utilities useful and beneficial," EPOPAI said.
Norwich Public Utilities of Connecticut said recently it annually cuts its consumption of traditional gasoline by 30,000 gallons, the equivalent of about 1,300 barrels of crude oil.
of Munich, Germany) has collected 64 previously published journal articles that have developed the main framework of economic analysis of public utilities. The articles concern themselves with the fundamental problems of optimal price and capacity determination in public utilities in relation to their economic and technological characteristics (e.g.
Marie Public Utilities Commission and other business partners to develop a remote monitoring technology for water treatment plants using wireless links, cameras and computers.
Apartments, townhouses and condominiums that have garbage containers filled with more than 10 percent of recyclable paper, cardboard, aluminum and tin cans and glass and plastic bottles and jars will be tagged with warning notices by Seattle Public Utilities inspectors.
GAO's objectives included determining the nature and the extent to which SEC regulates registered holding companies and the results of its regulation, the extent to which SEC reviews claims of exemption and the results of these reviews, and how SEC determines whether companies have a controlling influence over public utilities or holding companies.
However, in a recent ruling, the Federal Communications Commission (FCC) declared that VoIP is not so subject; see In the Matter of Vonage Holdings Corporation Petition for Declaratory Ruling Concerning an Order of the Minnesota Public Utilities Commission (FCC 04-267 (2004)).
Private companies managing public utilities have become more common since the early 1990s.
The new currency (florins) would be acceptable on a 1:1 basis in settlement of all amounts due in euros to government departments and public utilities. Many businesses, including retail outlets, would most likely also accept florins on the same basis.

Full browser ?