Mass. regulators gave preliminary approval to new price capping s...
Mass. regulators gave preliminary approval to new price capping system for Verizon that would limit increases in basic residential services to 5% annually and deregulate rates for most business services. In 108-page order adopted on 5-0 vote, Dept. of…
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Telecom & Energy (DTE) concluded Verizon had demonstrated there was sufficient competition for most of its business services to permit rate deregulation. Verizon has been under caps since mid-1990s. Its last plan expired in Jan., and company technically reverted to rate-of- return regulation but proceeding on successor cap plan already was under way. DTE said residential rates could move between floor and ceiling levels to be defined later, except that increases couldn’t exceed 5% per year. It said Verizon should be allowed to set different residential rates for urban, suburban and rural areas to reflect cost differences despite opponents’ concern that would allow carrier to raise rates in rural markets where there was little or no competition to subsidize lower rates in markets such as suburban Boston where residential competition exists. Mass. Attorney Gen. opposed business rate deregulation, saying Verizon still controlled 80% of business market and little local business competition existed outside I-495 corridor. AG spokesman said agency might appeal to state courts if plan finally was adopted. DTE directed Verizon to file by June 5 detailed description of new rates it would charge, which must address issue of whether there would be significant differences between rural and urban rates.