Summary: The federal government has played a significant role in the development of electricity markets. The federal government began to market electricity extensively in the 1930s after Congress authorized the construction of dams and established major water projects. To help Congress in its deliberations on the future role of power marketing administrations (PMA), this report provides a PMA-by-PMA analysis of the potential rate changes that would likely be experienced by preference customers who buy power from three PMAs if the power were sold at market rates. More specifically, GAO identifies potential changes in preference customers' rates and the share of total state power consumption for each state served by the Southeastern Power Administration, the Southwestern Power Administration, and the Western Area Power Administration. GAO concludes that, overall, slightly more than two-thirds of the preference customers that purchase power directly from these PMAs would likely see relatively small or no rate increases if they began to charge market rates for the power they market.
