Effective Regulation of Public Utilities

In August and September 2019, I reprinted two prior essays that argued for certification of regulatory professionals.  You can see them here and here.

These essays drew several thoughtful comments—some with important information, others with well-reasoned questions about, or skepticism about, the idea.  For what it’s worth—and I should have made it clear—my focus was mostly on commissioners and staff:  For commissioners, certification, preceded by serious education, would increase the chance of their rejecting non-merits forms of persuasion.  For staff, I saw certification as way of recognizing the skills they bring and rewarding them for acquiring more skills. 

Every word offered by the commenters below is worth considering.  Thank you for these offerings.
 

*   *   *

From Prof. Sandy Berg:

Our web site  www.regulationbodyofknowledge.org is a resource for professional certification programs.  It has been developed with the points you make in mind.    IP3 has some programs but I do think they involve testing.  

There is a formal PPP certification program that involves certified instructors and a test.  That program was funded by the World Bank and the Study Guide is very comprehensive.  So APMG manages that program now.  It focuses on international capacity and would not be particularly relevant for US regulators, but it illustrates that carefully designed certification programs can be effective.  

Public Utilities Resource Center at Univ. of Florida has a number of courses that would be appropriate for US Regulators:  rate design, RIA, Benchmarking, and cost of service analysis.  Finally, The narrative for the Body of Knowledge would be useful for new hires at agencies.  And the resource material is good.  Many of the FAQs on the BOKIR website are quite comprehensive.  

*   *   *

The North Carolina State Bar has a Utility Law Specialist designation.  See https://www.nclawspecialists.gov/for-lawyers/the-specialty-exams/exam-guides/utilities-law/        

*   *   *

[From David Magnus Boonin, Founder, TBG Consulting]

Question:  Who requires this certification? Although we agree that Commissioners should lead and not preside, judges hear cases in which they weigh evidence presented by witnesses, even expert witnesses. So do Commissioners need the same certification as experts? For that matter, what subject expertise does a lawyer need to represent a party in a regulatory proceeding?  Do customer service representatives need even a basic certification? Do advocates, whether consumer, large user environmental or utility experts need certification, as they are not dedicated to the public interest?  Do people who do research need the same qualifications as those who testify? And recognizing that two qualified experts can reached vastly different opinions when presented with same information (not necessarily facts) what answers would be accepted as correct in a test.

I would hope that regulators, however defined, would seek training wherever available. One thing I did for new hires at the PUC, including Commissioners, was to arrange for visits to facilities. What does the piping in nuclear look like? How big is a large hydro station? What does PJM’s control center look like?  What about a water treatment plant?....  I knew passionate , capable regulators dedicated to the public interest that couldn’t keep a kW and a kWh straight. I continue to learn myself after over 45 years in the field.

How many expert analysts have been challenged because they don’t know the definition of heteroscedasticity when presenting a simple statistical analysis?

I concur that training needs to be encouraged and funded.  But could certification  be so rigid as to limit creativity and lead to lots of me too thinking and inferior results . . .