duction, of which two-thirds would have come from consumers not having to pay for most of the utilities stranded investments, they will now have to settle for a guaranteed 15% rate cut, hopefully with more to come through competition. The question now on everyone's mind is: has the law served its purpose and reduced electric rates? In a study done by Standard and Poor's DRI entitled "Economic and Environmental Analysis of the New Massachusetts Electricity Law", and released on September 2, 1998, it found that the new has triggered "substantial economic and environmental benefits". According to the study, electric rates will decline by almost 28% by the year 2010 as a direct result of retail competition and industry restructuring. The DRI, a conservative report when compared to others, predicts that consumers will save $470 million in 1998 alone, and increases that estimate to at least $550 million per year in future years as a result of the new law. Also, the study predicts the Commonwealth to achieve higher economic output and employment growth triggered by the estimated $10 billion consumers and businesses will save on electricity costs. By 2010, there will be over 60,000 more jobs, a $19.6 billion gain in consumers' cumulative real discretionary income, and lower price inflation. All of this forecasting appears to put the law in a favorable light, but many want to know how it's working now. According to the Massachusetts Electric Company, its 970,000 customers have saved a total of $67 million on their electricity bills in the first six months of the new electricity law.On September 1, savings for the company's customers increased to more than 15%, or a total savings of $25 million per month, one full year ahead of the required rate cut. This was due to the company's affiliates selling their power plants. SummaryBy examining the early results of the Massachusetts Electricity Law, along with projections such as the ones provided by St...
