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Northeast - Connecticut State Legislature
By Chuck Burnham, External Affairs
Administrator, FirstLight Power Resources
In what has become an unfortunate
annual occurrence, the Connecticut state legislature has
proposed several bills that would significantly derail much of
the progress made in the state’s deregulated energy market.
While Connecticut officially restructured its wholesale
electricity markets to be more competitive in 1998, the retail
market has really taken shape over the past three years. In
2007, the competitive retail market truly opened, as both the
artificial prices caps (set at 10 percent below the 1996 rates)
and utility long-term purchases expired – not to mention that
Purchase of Receivables and referral programs were instituted
and customer switching restrictions were removed.
With
all those factors considered, it is easy to understand why,
since 2007, the number of customers choosing to switch
electricity suppliers in both commercial/industrial and
residential markets has increased dramatically. Now,
approximately 50 percent of all load in the state is served by
competitive suppliers. Switching by large businesses has been
particularly robust, with over 90 percent of those with demand
of 500 kW and over having chosen a competitive supplier.
Despite this progress, several legislative proposals are
still pending that would not only hurt the competitive market,
but also actually push the state back toward the old,
monopolized regime where one entity controlled energy
generation, distribution and transmission, and customers had no
ability to choose from whom they received their power.
One such bill would eliminate many of the customer referral and
educational materials that have helped produce the state’s
healthy switching rates, including the requirement that electric
companies provide information to consumers on choosing
alternative electricity suppliers. Also within the same proposed
legislation is a requirement that competitive suppliers provide
their own bill to customers – in addition to the one already
supplied by the utilities – which would take the flexibility
away from customers to have single or dual billing.
Another proposal would allow large customers to cancel a
contract after the first three days of its inception and charge
a customer an additional fee if they chose a supplier and then
switched back to standard service after one year.
Finally, and perhaps of greatest concern, is a proposal to
create a state power authority, which among other things would
have the ability to own and operate Connecticut power plants.
Such an authority would obviously expose ratepayers to enormous
financial risks and disrupt the progress in plant efficiency,
emissions reductions and renewable energy development being made
through private ownership of generation.
The most
effective way to combat these harmful proposals is by reaching
out directly to Connecticut state legislators. Fortunately, a
website,
www.competitionworksct.org, has been created to allow state
residents to quickly and easily contact their respective
legislators and the governor and express their opinions about
the benefits of the competitive market. A template letter is
already provided, so those that log on simply enter their name
and address and click “send.” Others should feel free to craft
their own personalized e-mail.
The critical message to
convey to legislators is that competitive suppliers have been
able to offer businesses thousands of dollars in savings over
the standard offer rate – money that companies can use to retain
employees and continue to invest in the state. In the current
economic downturn, these savings are absolutely critical.
Although the 2010 legislative session ends May 6, this is an
issue that inevitably arises year after year. The more that
customers continue communicating to state legislators and
emphasizing the benefits they have enjoyed because of the
competitive market, the less likely these proposals are to gain
traction in the future.
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