3.2 Purchase of the SPS by a Utility or Consortium of Utilities The major financial obstacles to utility ownership of the SPS are all associated with the SPS's high total capital cost ($7.6 billion). While all solar energy systems will experience some problem with gaining utility acceptance because of their high capital costs per kilowatt, the problems associated with the SPS are exacerbated by the SPS's large size. The reliability problems previously discussed apply to any 5 GWe generator, but the problems discussed in this Section apply only to 5 GWe, high capital cost, low operating cost systems like the SPS. Fusion and possibly breeder generators are the other proposed new power system which may have this combination of characteristics. Regulatory Issues The operations of the electric utilities are supervised by the regulatory commissions in each state. Besides performing the classical utility regulation functions of granting a local monopoly and requiring the utility to give service to all legitimate customers in the area served, these commissions deal with three main issues. • The rates which the utilities can charge; • The siting and safety of new facilities - generation, transmission, etc.; and • The quality of service, etc. The specific operations and responsibilities of each commission vary from state to state. The basic responsibility of all the commissions is to protect the interests of the consumers, both commercial and residential, in an area where the normal mechanics of competition have been suspended. The rate-setting part of a commission's responsibility has an obvious effect on the well-being of the consumer, but the other two responsibilities also have a large effect. The siting of unnecessary facilities could drive the utility rates up by forcing the present customers to pay for the operationg of equipment that may not be needed
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