energy markets in turmoil the consumer perspective
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Energy Markets in Turmoil The Consumer Perspective. Sonny Popowsky Consumer Advocate of Pennsylvania. Illinois State University Institute for Regulatory Policy Studies Springfield, IL May 17, 2001. PA Office of Consumer Advocate 555 Walnut Street Forum Place, 5 th Floor - PowerPoint PPT PresentationTRANSCRIPT
Energy Markets in TurmoilThe Consumer Perspective
Sonny Popowsky Consumer Advocate of Pennsylvania
Illinois State University
Institute for Regulatory Policy Studies
Springfield, IL
May 17, 2001
PA Office of Consumer Advocate555 Walnut Street
Forum Place, 5th FloorHarrisburg, PA 17101-1923
(717) 783-5048 Telephone(800) 684-6560 (PA Consumers
toll-free)[email protected] Ž
www.oca.state.pa.us63682
Pre-MergerNational League Standings
2000 Season
W L PCT GB
Braves 95 67 .586 -
Mets 94 68 .580 1.0
Marlins 79 82 .491 15.5
Expos 67 95 .414 28.0
Phillies 65 97 .401 30.0
W L PCT GB
Cardinals 95 67 .586 -
Reds 85 77 .525 10.0
Brewers 73 89 .451 22.0
Astros 72 90 .444 23.0
Pirates 69 93 .426 26.0
Cubs 65 97 .401 30.0
CENTRALEAST
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Post-MergerNational League Standings
May 10, 2001
W L PCT GB
Phillies 20 13 .606 -
Braves 16 18 .471 4.5
Marlins 14 18 .438 5.5
Mets 14 19 .424 6.0
Expos 13 21 .382 7.5
W L PCT GB
Cubs 21 12 .636 -
Astros 17 15 .531 3.5
Cardinals 17 15 .531 3.5
Brewers 17 16 .515 4.0
Reds 16 17 .485 5.0
Pirates 12 20 .375 8.5
CENTRALEAST
“Among states where deregulation has occurred, Pennsylvania has emerged so far as the place where the promises of competition and lower prices are being met most successfully.”
New York Times, “A Dwindling Faith In Deregulation”, September 15, 2000
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The Most Important Provisions In The Pennsylvania Electric
Restructuring Law
1. The Rate Cap Provision
2. The Rate Cap Provision
3. The Rate Cap Provision
Retail Competition Actually got off to a Reasonable Start in
Pennsylvania
1.8 million consumers volunteered for the 230,000 slots in the
competitive pilot
Pennsylvania - Number of Consumers ShoppingApril 1999 - April 2001
-
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
April 1 '99 July 1 '99 Oct. 1 '99 Jan. 1 '00 April 1 '00 July 1 '00 Oct. 1 '00 Jan. 1, '01 April 1, '01
New Power
Industrial
Commercial
Residential
Includes 253,253 customers of New Power under Competitive Default Service
Peak Load Share for Competitive SuppliersApril 2001
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
45.0%
AlleghenyPower
Duquesne Light GPU Energy PECO Energy* PPL
Per
cent
Residential
Commercial
Industrial
Statewide Competitive Load (mW)
-
1,000.00
2,000.00
3,000.00
4,000.00
5,000.00
6,000.00
7,000.00
8,000.00
9,000.00
Quarter
Load
in m
W
July 2001?
Duquesne - Competitive Load by Class (%)
0
5
10
15
20
25
30
35
40
45A
pr-9
9
Jul-9
9
Oct
-99
Jan-
00
Apr
-00
Jul-0
0
Oct
-00
Jan-
01
Apr
-01
Quarter
Per
cent
of C
lass
Loa
d
Residential
Commercial
Industrial
Price per kWh 500 kWh 1000 kWh Price per kWh 500 kWh 1000 kWh
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Average Price to Compare in Cents per kWh 5.65 ¢
500 kWh 1000 kWh First 500 kWh 5.55 ¢ $27.75 $58.80 over 500 kWh 6.21 ¢
Winter: October - May All kWh 5.55 ¢ $27.75 $55.50
Monthly Generation & Transmission Bill
Summer: June - September
PECO Energy Rate R Regular Residential Service
Licensed Competitive Suppliers:
Agway Energy ServicesOffer for non-heating oil customers 5.25 ¢ $26.25 $52.50Offer for Agway heating customers 4.95 ¢ $24.75 $49.50
Allegheny Energy Supply 4.95 ¢ $24.75 $49.50
American Cooperative 5.60 ¢ $28.00 $56.00
electricAMERICA100% hydro 4.80 ¢ $24.00 $48.00
Energy Cooperative Association of Pennsylvania 100% renewable 6.37 ¢ $32.27 $64.12
Exelon Energy 5.58 ¢ $27.90 $55.80
Green Mountain Energy Company 1% renewable Plus $3.95 per month 5.52 ¢ $31.55 $59.15
50% renewable Plus $3.95 per month 6.46 ¢ $36.25 $68.55
100% renewable Plus $3.95 per month 7.09 ¢ $39.40 $74.85
Plus $5 annual fee (waivable for senior cit izens, low income & persons with disabilit ies)
Mack Services Standard 5.49 ¢ $27.45 $54.90 100% renewable 6.37 ¢ $31.85 $63.70
6 month Value Power Plan 4.16 ¢ $20.80 $41.6012 month Standard Savings Plan 4.99 ¢ $24.95 $49.90
OnlineChoice.com Standard Electronic billing only 4.52 ¢ $22.60 $45.2050% renewable Plus $3.95 per month 6.46 ¢ $36.25 $68.55
Power Choice 5.45 ¢ $27.25 $54.50
Power Direct Standard 5.10 ¢ $25.50 $51.00Clear Choice Environmental Option 5.90 ¢ $29.50 $59.00
Utility.com Electronic billing only 4.52 ¢ $22.60 $45.20
--Green-e Certified
New Power Company
October1, 2000
PECO Energy Rate R Regular Residential Service Average Price to Compare
in cents per kWh 5.67 ¢500 kWh 1000 kWh
$27.85 $59.05First 500 kWh 5.57 ¢over 500 kWh 6.24 ¢Winter: October - May All kWh 5.57 ¢5.57 ¢ $27.85 $55.70Competitive Discount Service provided by New PowerNew Power CDS Average Price to Compare per kWh 5.536 ¢
$27.19 $57.62First 500 kWh 5.438 ¢over 500 kWh 6.085 ¢Winter: October - May All kWh 5.438 ¢5.438 ¢ $27.19 $54.38*Price to compare for PECO's Competitive Discount Service provided by New Power effective with April 2001 billing.
This service is available only to preselected PECO/New Power CDS customers.
Summer: June - September
Monthly Generation & Transmission Bill
Summer: June - September
Licensed Competitive Suppliers:
Agway Energy Services Offer for non-heating customers 7.50 ¢ $37.50 $75.00
Offer for Agway heating customers 7.00 ¢ $35.00 $70.00Allegheny Energy Supply 7.35 ¢ $36.75 $73.50electricAMERICA 50% hydro 5.65 ¢ $28.25 $56.50Energy Cooperative Association of Pennsylvania EcoChoice 100% renewable 6.37 ¢ $32.27 $64.12
Standard 5.25 ¢ $26.67 $52.92Plus $5 annual fee (waived for seniors, low-income & persons with disabilities)
Green Mountain Energy Company 1% renewable 5.52 ¢ $31.55 $59.15 50% renewable 6.46 ¢ $36.25 $68.55
100% renewable 7.09 ¢ $39.40 $74.85Plus $3.95 per month
Mack Services 100% renewable 7.53 ¢ $37.65 $75.30
New Power Company Two year plan 7.50 ¢ $37.50 $75.00
Price per kWh Price per kWh500kWh 1000 kWh 500kWh 1000 kWh
April
2001
Suppliers Serving Residential Customers in PECO(October 1999 through April 2001)
0
2
4
6
8
10
12
14
16
18
20
Month
Num
ber o
f Sup
plie
rs
Number of Suppliers Cheaper than PECO
0
2
4
6
8
10
12
14
16
18
Oct
-99
Nov-
99
Dec-
99
Jan-
00
Feb-
00
Mar
-00
Apr-
00
May
-00
Jun-
00
Jul-0
0
Aug-
00
Sep-
00
Oct
-00
Nov-
00
Dec-
00
Jan-
01
Feb-
01
Mar
-01
Apr-
01
Num
ber o
f Sup
plie
rs
Actual Usage and Savings for PPL Residential Customer, All-electric Home Switched to Utility.com
Months in year 2000
Usage in kWh per month
PPL
Generation & Transmission
Utility.com Generation & Transmission
Savings
February 2543 $112.57 $94.19 $18.38
March 2392 106.12 88.59 17.53
April 1440 65.47 53.37 12.10
May 1343 61.33 49.74 11.59
June 1163 53.64 43.08 10.56
July 1286 58.89 47.63 11.26
August 1252 57.44 46.41 11.03
Totals $515.46 $423.01 $92.45
Competitive Residential Electric Price Components - Cents per kwh
Electricity &
Capacity2.50 + .30= 2.8
3.25 + .30= 3.55
4.25 + 1.75 = 6.00
Losses (10%) .255 .325 .325
Wheeling .150 .150 .150Billing, etc. .500 .500 .500
EDI & IT .200 .200 .200Security Pmt. .005 .006 .007
Admin. .350 .350 .350
Profit .200 .200 .200
Billed Amt. 4.60 5.281 7.732
Are You Aware of Customer ChoiceRespondent = "Yes"
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Perc
ent
Do You Know How to Shop?Respondent = "Yes"
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Jun-98 Aug-98 Dec-98 Mar-99 Sep-99 Mar-00 Mar-01
Perc
ent
Shopping: Awareness v. UnderstandingResponses = "Yes"
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Jun-98 Aug-98 Dec-98 Mar-99 Sep-99 Mar-00 Mar-01
Perc
ent
Are you Aware ofCompetition
Do You Know How toShop
PJM Spot Market Monthly Average Energy Price Results
$0
$10
$20
$30
$40
$50
$60
$70
$80
$90
$100Ja
n-99
Feb-
99
Mar
-99
Apr
-99
May
-99
Jun-
99
Jul-9
9
Aug
-99
Sep-
99
Oct
-99
Nov
-99
Dec
-99
Jan-
00
Feb-
00
Mar
-00
Apr
-00
May
-00
Jun-
00
Jul-0
0
Aug
-00
Sep-
00
Oct
-00
Nov
-00
Dec
-00
Jan-
01
Feb-
01
Mar
-01
$/M
Wh
On-Peak Spot vs. Forward PricesComparison of Last Settlement Price before Contract Month to Actual Avg. Spot Price
$0
$20
$40
$60
$80
$100
$120
$140
$160
$180JA
N99
MA
R99
MA
Y99
JUL9
9
SE
P99
NO
V99
JAN
00
MA
R00
MA
Y00
JUL0
0
SE
P00
NO
V00
JAN
01
MA
R01
Contract
$/M
Wh
Forward Price Monthly Avg On-Peak Spot Price
PJM Forward Market - 1999, 2000 & 2001
-
20.00
40.00
60.00
80.00
100.00
120.00
140.00
Jan Feb Mar April May June July Aug Sept Oct Nov Dec
1999
2000
2001
PJM Daily Capacity Credit MarketJanuary 1999 - March 2001
0
50
100
150
200
250
300
Jan-
99
Mar
-99
May
-99
Jul-9
9
Sep-
99
Nov
-99
Jan-
00
Mar
-00
May
-00
Jul-0
0
Sep-
00
Nov
-00
Jan-
01
Mar
-01
$/m
W-d
ay
PA Gas Switching Statistics as of 04/01/01Company Total Residential
CustomersResidential using Alternative Suppliers
Columbia 355,256 94,466
Dominion-Peoples 325,146 110,399
Equitable 241,699 18,900
NFG 200,211 0
PECO 399,316 0
PG Energy 139,022 0
PPL 65,281 0
T W Phillips 54,723 0
UGI 249,762 0
Valley Cities-NUI 4,412 0
Total 2,034,828 225,765
Henry Hub Natural Gas Spot Prices
$0
$1$2
$3
$4
$5$6
$7
$8$9
$10A
pr-9
8
Jul-9
8
Oct
-98
Jan-
99
Apr
-99
Jul-9
9
Oct
-99
Jan-
00
Apr
-00
Jul-0
0
Oct
-00
Jan-
01
$/m
mB
tu