On a Thursday afternoon last June, state troopers from Connecticut and New York fanned out on a manhunt. Their quarry: several of the dozen Connecticut legis-lators and commissioners with the power to make or break Massachusetts-based TransÉnergie U.S., a pioneer in advanced high-voltage power transmission owned by Mont-réal power utility Hydro-Québec. For two years, political squabbling had idled an innovative 40-kilometer underwater power line installed by Trans-Énergie to strengthen the link between the Connecticut and Long Island power grids. On the Thursday in question, Trans-Énergie, Long Island's power utility, and Connecticut regulators had finally found a way to end the impasse. All they needed to seal the deal were signatures from all 12 of those Connecticut politicians.

The manhunt marked the dramatic close to a saga that made TransÉnergie a poster child for the confusion that reigns in the U.S. power market. In the early 1990s, the U.S. Congress threw wholesale power markets open to competition, enabling state utilities to buy bulk power from generators located hundreds or thousands of kilometers away (much of New England and New York's power, for example, comes from Québec). But regional coördination of power grids to accommodate long-distance power delivery has stalled. All too often, coördination has fallen victim to interests that stand to lose from increased competition; and federal law gives states the upper hand in regu-lating electrical transmission, thwarting the best efforts of power regulators in Washington. "It's really a mess," says Sally Hunt, a power-industry expert affiliated with National Economic Research Associates, a consultancy in New York.