NY Electricity Deregulation Doesn't Make The Grade

Todd Grady - Democrat and Chronicle - 9-18-02

Electricity deregulation in four states, including New York, does not deserve a high grade. So says the National Center for Appropriate Technology.

The center found that residential customers have few choices for buying electricity from a provider other than the local utility, according to its report released Tuesday. Those customers who did choose a competitor saved only 50 cents to $4 a month.

The center in Butte, Mont., also researched electricity deregulation in Texas, Ohio and Massachusetts. The nonprofit center's self-described mission is to assist economically disadvantaged people with housing and energy issues.

"There was initial excitement about customer choice and a fairly large number of marketers who started out marketing in a lot of states," said Barbara Alexander, one of the study's authors and former director of the Maine Public Utilities Commission. "A pretty clear result in a lot of states is the market is shrinking."

In Rochester Gas and Electric Corp. territory, 46,000 customers, or 13 percent, were getting their electricity from an alternative supplier, the utility said.

"There was some expectation in the early days that the market would be flourishing by now, but we've learned that it's going to take longer," said RG&E spokesman Mike Power.

Energetix Inc. is the only other company selling electricity to residential customers in RG&E's service territory. On Tuesday, Energetix quoted a $1 a month savings on electricity compared with RG&E.

Energetix and RG&E are both subsidiaries of RGS Energy Group Inc.

About 48,000, or 16 percent, were using alternative suppliers for natural gas. Fifteen companies were qualified to sell natural gas as of Aug. 1, but only a handful, including Energetix, are currently selling to customers, according to RG&E's Web site.

Energetix declined to disclose how many customers it has.

"The majority of folks who have left RG&E have come to Energetix," said Jim DiStefano, the company's vice president of sales and marketing.

RG&E started deregulating its electricity market in 1998. The utility became fully deregulated in July 2001. Its natural gas market has been deregulated since 1986.