National policy for many years has been, and continues to be, to foster competition in wholesale power markets. In each major energy bill over the last few decades, Congress has acted to open up the wholesale electric power market by facilitating entry of new generators to compete with traditional utilities. As the third major federal law enacted in the last 30 years to embrace wholesale competition, the Energy Policy Act of 2005 strengthened the legal framework for continuing wholesale competition as federal policy for this country. The Commission has acted quickly and strongly over the years to implement this national policy.
The Commission's core responsibility is to "guard the consumer from exploitation by non-competitive electric power companies." The Commission has always used the following two general approaches to meet this responsibility:
Regulation - was the primary approach for most of the last century and remains the primary approach for wholesale transmission service.
Competition - has been the primary approach in recent years for wholesale generation service. Advances in technology, exhaustion of economies of scale in most electric generation, and new federal and state laws have changed the Commission's views of the right mix of these two approaches. The Commission's goal has always been to find the best possible mix of regulation and competition to protect consumers from the exercise of monopoly power.