The electric utility industry, seeing financial disaster and power blackouts on the near horizon, has announced plans to spend $2.8 million persuading regulators and the public that it needs help.

The 14-month publicity campaign, which began this week with large advertisements in major newspapers, argues that letting power companies charge customers a little more now will actually cut electricity rates or hold them stable in the long run.

This will happen, the ads say, because oil-burning and old, inefficient plants can be replaced by more efficient coal units. That will cut oil and gas use, help control inflation and guarantee future energy supply.

The issues are crucial, involving billions of dollars, massive construction programs and huge numbers of jobs. Everywhere, utilities that used to be blue-chip investments are cutting dividends and halting projects.

At a briefing for reporters, spokesmen for the Edison Electric Institute, the industry trade association, said its 200-member power companies are in trouble because regulators have been short-sighted.

In state after state, commissioners won't let them charge enough to be able to pay their investors the 16 to 18 percent return investors can get on the money market somewhere else, the ads will argue. But in order to supply electricity demand, growing at 3 to 3.5 percent per year, the industry has got to get $155 billion from those investors over the next five years.

That is a massive amount of money, a drain on the money supply second only to the billions that the U.S. government borrows every year to pay bills that taxpayers don't cover. Such borrowing has been a major factor in keeping interest rates high.

Luring investment now is critical in order to have the needed plants built by the 1990s when growing electricity demand will catch up with current extra power supplies, the EEI said, adding that this can't happen under current policy.

"The way it is now, the smartest thing a utility executive could do for his stockholders would be to liquidate his assets as quickly as possible and get out of the business," said Charles J. Cicchetti, former chairman of the Wisconsin Public Service Commission and currently an economics professor at the University of Wisconsin.

"If we can get the kind of investments made that will pull down costs, this industry can turn around dramatically," he said.

Cicchetti appears in the first of EEI's ads, which involve only the print media. Although EEI will try to arrange appearances and interviews for its experts on television talk shows and science programs, no TV ads are planned. "The issues are too complicated to be addressed in a 30-second spot," said EEI spokesman Kirk Willison.

The print ads are also aimed only at what EEI called 15 million "activists" who are well educated, affluent, active in political affairs and make speeches. "Every known communications method will be used to create maximum attention and impact for the industry's story," EEI's announcement said.

Critics have long argued that the electric industry already has 20 to 40 percent more power generating capacity than it needs nationwide, that little new construction is necessary, and that utilities have routinely overestimated the demand they will face.

Douglas Bauer, senior EEI vice president for economics and finance, responded that the excess capacity tends to be in the Northeast and industrial Midwest and is in older, oil-burning "tea kettles" that are used only as a last resort. New demand, he said, is concentrated in growing Sun Belt areas and requires new construction.