Certification of Regulatory Professionals:
Why Not?

Accountants, architects, barbers, cosmetologists, crane operators, dentists, docking masters, doctors, electricians, engineers, foresters, home inspectors, interior designers, landscape architects, lawyers, land surveyors, pilots, plumbers, private detectives, real estate appraisers, real estate brokers, security systems technicians, security guards and tax preparers.

These are among the professions my state of Maryland certifies. Most states have similar lists. And missing from every state's list is "utility regulators." Having practiced within this field in multiple roles—as a hearing room litigant, appellate lawyer, commission advisor, opinion-drafter, legislation-drafter and expert witness—I am convinced that regulation can improve if it certifies its practitioners. How we do that leads to a series of questions, explored this month and next.

Why Certify?

Certification has a market mission and a professional mission. In the marketplace, certification protects consumers from harm, while rewarding the qualified and penalizing the unqualified. In the professions, certification defines the profession's purpose, then establishes and upholds its standards. It answers the question, "What does it mean to be a good architect/accountant/doctor/lawyer?


Testimony, Papers, and Presentations

“Regulatory capture” is a ringing phrase, too casually used. But because it is a hyperbolic phrase, it is too readily dismissed. With a careful definition, regulatory capture can be anticipated, detected, and resisted. Regulatory capture does not include illicit acts—financial bribery, threats to deny reappointment, promises of a post-regulatory career. These things all have occurred, but they are forms of corruption, not capture. Nor is regulatory capture a state of being controlled, where regulators are robots executing commands issued by interest groups.
In this proceeding before the Mississippi Public Service Commission, Entergy proposes to sell its transmission facilities to ITC at a gain. The transaction is a “spin-merge” transaction in which Entergy shareholders will end up owning 51% of ITC, along with their shares of Entergy.
Utilities are seeking to earn returns on equity above the real cost of equity. Currently, there are five strategies: (1) move assets from state jurisdiction to FERC jurisdiction; (2) use holding company debt to fund utility subsidiary equity (aka "double leveraging); (3) seek supranormal returns as "incentives" to perform normal tasks; (4) seek authorized returns that reflect certain business risks while shifting those risks to ratepayers; and (5) use "riders" reduce business risks without reducing authorized return on equity. This presentation describes these strategies.

Now Available

Regulating Public Utility Performance

“[A] comprehensive regulatory treatise …. In all respects, it merits comparison with Kahn and Phillips."

Regulating Public Utility Performance:  The Law of Market Structure, Pricing and Jurisdiction

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Preside or Lead

Preside or Lead?
The Attributes and Actions of Effective Regulators

Now Available on Kindle

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Hempling Appearances

Nigeria Electricity Regulatory Commission
3rd Judges’ Seminar

Telecom Forum
Asamblea Plenaria REGULATEL

NARUC Annual Meeting
Panel on State–Federal Relations

New England Electricity Restructuring Roundtable
The Future of Demand Response in New England

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Market Structure Struggle, Jurisdictional Stress, Profit-Seekers and Free-Riders:
Is Regulation Ready?


Electricity Jurisdiction

Letter to Governors and Legislators

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While we will dearly miss you as NRRI's Executive Director—where you have been so invaluable—I am delighted that you will now be in the classroom enlightening and sparking the interest of the next generation.
— Paul J. Roberti, Commissioner, Rhode Island Public Utilities Commission