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<br />. <br /> <br />. <br /> <br />A Right to Federally Generated Power: <br />An Analysis of the Preference Clause <br /> <br />NUMEROUS FEDERAL STATlITFS provIIJe Iha' e~ccss e1eclric <br />power generated at Federal facilities should he sold 10 Slale and local <br />governmental entities and III privale, 1I0n-profil organizalions, where <br />lhost' ~ntili~s and organil.atiolls arc able and willing 10 plln:ha~c (he <br />electricity, and thai only aflcr Ihese preferred cuslomers' neeus have <br />heen met should excess rederal power he uiSlrihnled In inl'eSlor-owneu <br />utili/ic,\', Thcse provisions, whic'h eSlahli"h a system of priorilies in the <br />dislrihution of Federal power, are collectively referred III as Ihe <br />. 'prCrerl~l1cc clause.' I <br />The preference clause has drawn opposition, primarily from investor- <br />owned utilities, fnr more Ihau fifly years. Early ill ils hislory, hallles <br />over ils indllsion in various FcdL:LII pov.:L'r ~ralU(c~ \\'l.'n.' hOlh IIICeU!-ll.' <br />and hiller. Sllpp()rtcr~ of Ihl' pi I.: fl..: I l'llCl' t:hIU\',: prl.:vi.likd ill Ilhh~ bat- <br />tles. however, primarily hl.'L';J,U:-'C III(: Cnllgre....... recognized Ihallhc puhlic <br />interesl,bencrilted from thc d;"lrihulion of ""ueral power for public <br />purposes, <br />The issue of preference power \1"" les" Colli rm'er,;al ill the miu-1950's <br />and lhe llJ60's. Ecnnumic~ of :-....:ak achieved ill )!cncralillg t..'lcclriciIY <br />rcsulled in ~\)nSiSIl'nlly decrcasing 1..11...h per lIllit of c!cl'nicity, and <br />opponcnls of Ihe prl.:'fl'rcnce PO\''''l~r fOllnd !lOIl-prt..'ferl'lll.:e pO\\!l"r hoth <br />ch~i.1p and readily iJvailahk. lit I\\l.'\ I.T. 1111.' 11<111011 h;p., wil nl:.,.,~c:d L1rama- <br />li~ ...:hangcs in Ihe nalHJIlall:lll:lgy pictllll: ill IIIL' pa~l kl1 Yl:ar\. An in~ <br />creasing awan:n('s!'.. of rhe cllvirtlllllll'IlLd illlpacrs Dr dcclric gCllcralion. <br />the r~ali/Htiolll)r Iht' fillllC lIalufL' Ill" Ildll-rl:Ill'\\:ahk re....ullrcc.... and Ihe <br />finilc capal'ity of hydrllCkl'lrk r;ll'ililk~ alld n( Ihl: Illng kat.! limes rl"- <br />quirl'd Il) hriJlg Jll"\\' dcclril' LH..:ilil!c'l IllllillL.'. ;1'., \\I:II;t\ the l:tpidly ri~illg <br />cosh of c()n~trll~lin~ gcn('ralill~ LIL.itilit'..... have rCl.jullcu in rl.:'lll'wed in~ <br />tcr~Sl illlhL' prCfCrl"fh':c l'Iall~c. <br />It b in light of these rel.:CIlI ,k\ddPIlICIlIS 111:11 \lIggcstion~ have hccn <br />made (hal Ihe prcfcfclh:C dall~\' 1;-., illlill..'hr{)lIi~,tic, Ih;.tl (he puhlic pnlil'Y <br />and antimollopoly aspecl.... of preferellcl" PO\\'l'[ '-Ife JlO long!:r relevant, <br />and lhat there is no longer allY Ilt'cd I'll I llie Fetleral governmenl 10 <br />e"ablish priorities for the sale 01 il.s electric p"wer. The rene\l'cJ allaeks <br />on lhe preference clause make il approprlale to reexamine Ihe grounds <br />upon which the preference c1ausc hecame a part of our national policy, <br />The analysis which lollows no/ 'only l'onfinm Ihe wi"dolll 01 Congress <br />in legislating priorities in the di"ribull'"1 of power, but demonstrates <br />the continued validity of those policies in the conlexl of the rapiuly <br />changing energy picture of the 1970', and 19MO's, <br /> <br />5 <br />