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Connecticut - Electricity

In Connecticut’s newly released Comprehensive Energy Strategy, Governor Dannel P. Malloy has proposed a new statewide arrangement that would eliminate a customer’s option to be on the utility’s Standard Offer Service. The governor’s mandate includes requiring existing customers on standard service to switch to competitive supply. The Department of Energy and Environmental Protection (DEEP) intends to segment customers serviced on the utility into tranches of 100,000, and subsequently auction off these tranches to the top supplier. It is unclear at the moment whether customers currently on standard service will be allowed to opt-out of the auction.

The premise of auctioning these tranches is to generate new revenue for the state, which governor Malloy’s team believes will be in the vicinity of $80 million. In order to assure customer savings, competitive retail electricity suppliers will be mandated to offer a rate of at least 5% less than the utility’s standard offer. This stipulation, coupled with the fact that increased competition consequently drives down prices in the marketplace, should offer a great opportunity for customers to realize savings on their energy bill. If customers are not satisfied after the first year, they would be allowed to return to standard service if they desire. The proposal could begin its initiation phase as early as 2013, with hopes of full transition to competitive supply being implemented in 2014. Posted 3/22/13.

New York and New Jersey - Electricity

In 2013 ratepayers in New York and New Jersey may want to evaluate switching to competitive supply as several utilities lower the mandatory hourly pricing threshold for retail customers. All New Jersey utilities have filed a proposal to reduce the hourly price threshold from 750kW to 500kW effective June 2013. For the same time period, New York utility Niagara Mohawk (National Grid) has also proposed to reduce their respective threshold to 250kW. Another New York utility, Orange & Rockland, will decrease their threshold from 500kW to 300kW in May of this year. Customers on the hourly rate with the utility will be exposed to the volatility of the market when pricing electricity. The potential for steep price spikes often dissuades customers from indexing their energy use, and those that prefer budget certainty will instead migrate to a competitive supplier for a fixed price contract. Posted 2/13/13.

Washington, D.C. - Electricity

Just months after the District of Columbia Public Service Commission granted Pepco a smaller than desired rate increase; the utility has filed for another Standard Offer Service rate increase with the PSC for a 12 month term beginning June 1, 2013. Pepco has come under scrutiny in recent months with customers complaining about the utility’s increased rates, despite less than satisfactory efforts restoring power relative to their DC Metro counterparts. Simultaneously Pepco also faced a labor discord that practically resulted in a company strike. Though the subsequent rate increase is only expected to average around 3 mils for medium and large commercial customers, it won’t sit well with a previously disgruntled customer base and could influence further customer migration to competitive supply. Posted 2/6/13.

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