Owens-Brockway, the largest glass manufacturer in the United 

States, has about two dozen manufacturing plants scattered across the 

country. One of its drink bottling plants is located in Lakeland, 

Florida, a public power community roughly halfway between Orlando and 

Tampa along Interstate 4. Owens-Brockway is a top area employer and one 

of the city-owned electric system's largest customers. So when    

    Owens-Brockway and a dozen other large industrial customers asked 

for lower electric rates, Lakeland's managers listened intently and 

responded by offering all 13 Of its largest customers - including 

Pepperidge Farms, Juice Bowl, Florida Tile, Bee Gee Shrimp, Publix 

Supermarkets, and air bag manufacturer Breed Technologies - a 20 

percent tariff reduction. To qualify, new or existing customers must 

have a 12-month average load factor of 60 percent or more and a demand 

exceeding one megawatt. implicit in the tariff rate is a promise: if 

Lakeland's prices get out of line, customers can request a rate 

reduction. If rates don't come down, the contract is null and void, and 

the company can buy its power elsewhere. 

    In today's environment, I'd rather do business with a supplier who 

wants to work with me and intends to keep my business," explains David 

G. Cesio, director of energy services for Xenergy, an energy services 

subsidiary of New York State Electric & Gas, which oversees 

Owens-Brockway's corporate energy account. "Owens decided to stay with 

[Lakeland] and work with them because they have done everything to make 

doing business with them a real pleasure." That, according to Cesio, is 

in marked contrast to the majority of utilities, which vigorously 

resist negotiation.

    Unlike its privately owned competitors, Lakeland was able to 

accommodate its customers' needs because the city owns its utility 

services and, therefore, did not have to get permission from state 

regulators to offer incentive or contract rates. Moreover, Lakeland did 

not have to wait for state or federal regulators to settle big-picture 

issues associated with electricity restructuring, and they certainly 

did not have to be ordered by government Fiat to participate in a more 

competitive marketplace. 

    As Cesio's experience with Lakeland demonstrates, business 

executives who seek low electric rates, reliable power, unparalleled 

customer service, and new and innovative service offerings are finding 

it makes good business sense to relocate or expand in one of the more 

than 2,000 public power communities across the United States. No matter 

where a firm relocates or expands, chances are good that public power 

already is there. There are public power systems in every state except 

Hawaii, ranging in size from Holyrood, Kansas, with 316 meters, to Los 

Angeles, with 1.3 million customers. Community-owned systems also 

operate in such large cities as Anaheim, Austin, Memphis, Orlando, 

Omaha, Phoenix, San Antonio, and Seattle. And a large portion of New 

York State's electricity comes from a state-owned public power system. 

In fact, 20 percent of all industrial power users are already located 

in public power communities.

    These numbers are growing every day, for one simple reason: Cities 

recognize that business and industry are very important members of 

their communities, And that means they're much more willing than other 

utilities to go the extra mile for their customers. "Cities could well 

be more sensitive to the needs of customers than an investor-owned 

utility, which traditionally hasn't seemed to care about large 

electricity users," opines John Anderson, executive director of the 

Electricity Consumers Resource Council, a Washington, D.C. based member 

organization composed of large industrial electric users. 

    Further, many public power entities are themselves wholesale power 

customers, and cities - or groups of cities - can band together in 

search of lower wholesale energy prices. Since public power operates on 

a not-for-profit basis, any savings in electricity prices are passed 

along directly to the customer-owners of the system, rather than being 

siphoned off by profit-taking shareholders. In fact, net income for 

investor-owned utilities in 1996 was $20.3 billion, according to the 

Edison Electric Institute. Private utilities paid $14.8 billion in 

common stock dividends in 1996, while earnings per share totaled $2.13. 

    Of course, making a profit is what business is all about. In public 

power communities, however, those profits are returned to citizens in 

the form of lower prices. The price differences can be substantial. For 

instance, in New Hampshire, where only five cities and towns own their 

own utility systems, industrial customers of private power utilities 

pay, on average, nearly two cents per kilowatt hour more for their 

electricity than those in public power communities: 9.6 cents/kWh as 

compared to 7.9 cents/kWh. For commercial customers, the story is 

similar: 11.3 cents/kWh in private power communities versus 9.9 

cents/kWh in public power communities. Overall, commercial customers of 

private power systems pay nearly 20 percent more for electricity. 

Public power utilities are far more likely to increase competitiveness 

by controlling costs, reducing work forces, renegotiating contracts, or 

paying down high-cost debt, according to Standard & Poor's. 

    While lower prices are a compelling reason to locate in a public 

power community, they are not the only one. Public power provides a 

level of service unequaled by private rivals. As was the case with 

Lakeland, public power utilities are already showing large customers 

they mean business. In fact, several public Power communities, 

including those in Los Angeles and Phoenix, currently offer service 

guarantees that reward the customer - and penalize the utility - if a 

power problem isn't fixed within minutes of a service call.

    Also, because many municipalities operate more than one utility, 

all the necessary permits - water, electric, sewer, natural gas, 

wastewater - can be arranged within one office, during one visit. In 

fact, many city-owned utility managers are glad to run interference for 

large customers with other local government agencies. What's more, many 

communities offer comprehensive computerized site selection databases 

allowing businesses to shop for suitable sites without leaving the 

office. Numerous public utilities operate hand in hand with the local 

economic development agency, allowing them to help craft a package of 

incentives tailored to the needs of individual businesses.

    And, if you've ever wished your company could take up its concerns 

directly with the CEO of the local utility, you'll be glad to know that 

it's not only possible in a public power community, but encouraged. 

That's because the top official lives and works nearby, not in another 

time zone. Local ownership and control means you don't have to argue 

with faceless customer service representatives on the end of a 

long-distance telephone line.

    Community ownership takes on new meaning in the wake of merger 

activity in the private utility sector. As of mid-1997, 17 proposed 

mergers between private utilities were awaiting federal approval. in at 

least one, the merged entity would control 100 percent of the retail 

market. 

    Public power communities offer a number of innovative services as 

well, such as broadband telecommunications services for businesses 

seeking high-speed voice, video, and data communications capabilities. 

Some provide lower-priced telephone service, others help customers 

reshape energy usage, and still others provide a single utility bill 

for multiple locations. 

    Across the United States, public power is taking a proactive role, 

aggressively seeking ways to reduce costs and provide better customer 

service. In many regions, municipal utilities have formed marketing 

alliances or power pooling arrangements; in some cases, they are 

teaming up with power marketers - or even investor-owned utilities - to 

market electricity and natural gas to wholesale and retail electric 

customers. Some are forming regional coalitions to shop for new power 

supply contracts, while others swap power with different electric 

systems to average out peak loads. 

    In short, the advantages of locating or expanding in a public power 

community are so outstanding that cities across the country are 

exporting forming their own public power systems. Nationwide, public 

power systems provide lower energy prices, reliable electric power, 

unparalleled customer service, and value-added services that flow 

directly to the bottom line. Public power communities want your 

business - and they'll do what it takes to get it.