AUGUSTA (AP) – A new draft report by the state Public Utilities Commission says the organization of the New England power grid is “fundamentally flawed” and that Maine could benefit from any of three alternatives, including in-place changes, outright withdrawal or a new partnership.

Possible improvements, according to the analysis, could come from market reforms within ISO-New England, which administers the regional wholesale power market and manages and dispatches the transmission system.

Other options offering advantages for Maine include the establishment of an independent Maine transmission company or a linkup of Maine and New Brunswick, the draft report says.

“However, each policy option is complex and requires careful consideration by the Legislature. Ultimately, the Legislature must weigh whether the infirmities of the status quo are so great that the risk of regulatory change is warranted,” the study commissioned by state lawmakers says. The commission analysis, following up on an interim report that was issued last January, cites half a dozen “serious and valid” concerns with how the current regulatory structure operates for Maine.

Among those, the report says electricity supply prices since 1990 have increased by 35 percent nationwide, compared to 55 percent in Maine and New England. It adds that New England’s dependence on natural gas that must be brought in “poses a substantial risk to electrical reliability.”

The report asserts that “Maine consumers are paying more than their fair share of regional costs” because “regional rules inequitably allocate costs among the region’s consumers, driving the consumers of a smaller state like Maine to shoulder the costs of larger states.”

Additionally, the report says consumers “are left out of the increasingly influential regional and federal decision-making process” and that regional institutions may not respond to state goals. ISO-New England has a number of the same concerns that Maine does, but a regional approach offers the most options and economies of scale, said ISO-New England spokeswoman Ellen Foley.

“In our view, a logical and mutually beneficial relationship exists between Maine and the rest of the New England states,” Foley said. “Both areas rely on one another to achieve positive outcomes for consumers.” The PUC will take comments on the draft report until Dec. 21, with a final report to be presented to the Legislature’s Utilities and Energy Committee in January.

Revising an earlier estimate and leaving plenty of room for adjustment, the new analysis pegs the potential net loss for Maine from staying with the status quo at $250 million to $500 million over five years.

For any of the three options outlined in the draft report, “the implementation time would be a minimum of two years,” PUC Chairman Kurt Adams said at a briefing for reporters at the commission’s headquarters in Augusta.

One ranking Maine lawmaker praised the PUC analysis Wednesday and said the time had come to consider change.

“It’s clear that ISO-New England’s priorities are not in line with the best interests of Maine people,” House Majority Leader Hannah Pingree said in a statement. “When we are expected to shoulder the costs of southern New England’s lack of energy capacity without getting any benefit from this partnership, it’s clear that we must look for other options.

“The report has moved this issue to the forefront of the discussion on our state’s energy future, and it will be a priority for the Legislature in 2008,” Pingree said.

The draft report addresses both economic and environmental issues, declaring that “policy makers are sensing that the region is incapable of meeting consumers’ needs for predictable and manageable electricity prices, and that regional institutions are not meeting environmental challenges.”

The authors say their three options “would support the development of diverse, renewable and low CO2 resources and more reasonably treat Maine’s interests within the applicable market and regulatory systems.”