Energy Markets in Turmoil The Consumer Perspective

Transcription

1 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 Harrisburg, PA (717) Telephone (800) (PA Consumers toll-free) paoca@ptd.net

2 Pre-Merger National League Standings 2000 Season EAST W L PCT GB Braves Mets Marlins Expos Phillies CENTRAL W L PCT GB Cardinals Reds Brewers Astros Pirates Cubs ppt

3 Post-Merger National League Standings May 10, 2001 EAST W L PCT GB Phillies Braves Marlins Mets Expos CENTRAL W L PCT GB Cubs Astros Cardinals Brewers Reds Pirates

4 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, ppt S2

5 The Most Important Provisions In The Pennsylvania Electric Restructuring Law The Rate Cap Provision The Rate Cap Provision The Rate Cap Provision

6 Retail Competition Actually got off to a Reasonable Start in Pennsylvania

7 1.8 million consumers volunteered for the 230,000 slots in the competitive pilot

8 Pennsylvania - Number of Consumers Shopping April April , , , ,000 New Power Industrial Commercial Residential 500, , , , ,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 Includes 253,253 customers of New Power under Competitive Default Service

9 45.0% 40.0% 35.0% Peak Load Share for Competitive Suppliers April 2001 Residential Commercial Industrial Percent 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% Allegheny Power Duquesne Light GPU Energy PECO Energy* PPL

10 Apr. 1, '01 9, , , , , , , , , Statewide Competitive Load (mw) July 1 '99 Oct. 1 '99 Jan. 1 '00 April 1 '00 July 1 '00 Oct. 1 '00 Jan. 1, '01 Quarter July 2001? April 1 '99 Load in mw

11 Duquesne - Competitive Load by Class (%) Residential Commercial Industrial Apr-99 Jul-99 Oct-99 Jan-00 Apr-00 Jul-00 Oct-00 Jan-01 Apr-01 Quarter Percent of Class Load

12 PECO Energy Rate R Regular Residential Service Average Price to Compare Monthly Generation & in Cents per kwh 5.65 Transmission Bill Summer: June - September 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 Licensed Competitive Suppliers: Price per kwh 500 kwh 1000 kwh Price per kwh 500 kwh 1000 kwh Agway Energy Services Offer for non-heating oil customers 5.25 $26.25 $52.50 Offer 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 electricamerica 100% hydro 4.80 $24.00 $48.00 Energy Cooperative Association of Pennsylvania 100% renewable 6.37 $32.27 $64.12 Plus $5 annual fee (waivable for senior citizens, low income & persons with disabilities) Exelon Energy 5.58 $27.90 $55.80 Green Mountain Energy Company 1% renewable Plus $3.95 per month 5.52 $31.55 $ % renewable Plus $3.95 per month 6.46 $36.25 $ % renewable Plus $3.95 per month 7.09 $39.40 $74.85 Mack Services Standard 5.49 $27.45 $ % renewable 6.37 $31.85 $63.70 New Power Company 6 month Value Power Plan 4.16 $20.80 $ month Standard Savings Plan 4.99 $24.95 $49.90 OnlineChoice.com Standard Electronic billing only 4.52 $22.60 $ % 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 $51.00 Clear Choice Environmental Option 5.90 $29.50 $59.00 Utility.com Electronic billing only 4.52 $22.60 $ Green-e Certified October1, ppt

13 PECO Energy Rate R Regular Residential Service Average Price to Compare in cents per kwh 5.67 Summer: June - September Transmission Bill 500 kwh 1000 kwh $27.85 $59.05 First 500 kwh 5.57 over 500 kwh 6.24 Winter: October - May All kwh 5.57 $27.85 $55.70 Competitive Discount Service provided by New Power New Power CDS Average Price to Compare per kwh Summer: June - September $27.19 $57.62 First 500 kwh over 500 kwh Winter: October - May All kwh $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. Monthly Generation & Licensed Competitive Suppliers: Price per kwh 500kWh 1000 kwh Agway Energy Services Offer for non-heating customers 7.50 $37.50 $75.00 Offer for Agway heating customers 7.00 $35.00 $70.00 Allegheny Energy Supply 7.35 $36.75 $73.50 electricamerica 50% hydro 5.65 $28.25 $56.50 Energy Cooperative Association of Pennsylvania EcoChoice 100% renewable 6.37 $32.27 $64.12 Standard 5.25 $26.67 $52.92 Plus $5 annual fee (waived for seniors, low-income & persons with disabilities) Price per kwh April kWh 1000 kwh Green Mountain Energy Company 1% renewable 5.52 $31.55 $ % renewable 6.46 $36.25 $ % renewable 7.09 $39.40 $74.85 Plus $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

14 Suppliers Serving Residential Customers in PECO (October 1999 through April 2001) Oct-99 Nov-99 Dec-99 Jan-00 Feb-00 Mar-00 Apr-00 May-00 Jun-00 Jul-00 Aug-00 Sep-00 Oct-00 Nov-00 Dec-00 Jan-01 Feb-01 Mar-01 Apr-01 Month Number of Suppliers

15 Number of Suppliers Cheaper than PECO Number of Suppliers Oct-99 Nov-99 Dec-99 Jan-00 Feb-00 Mar-00 Apr-00 May-00 Jun-00 Jul-00 Aug-00 Sep-00 Oct-00 Nov-00 Dec-00 Jan-01 Feb-01 Mar-01 Apr-01

16 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 $ $94.19 $18.38 March April May June July August Totals $ $ $92.45

17 Competitive Residential Electric Price Components - Cents per kwh Electricity & Capacity = = = 6.00 Losses (10%) Wheeling Billing, etc EDI & IT Security Pmt Admin Profit Billed Amt

18 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Percent Are You Aware of Customer Choice Respondent = "Yes" Oct-98 Dec-98 Feb-99 Apr-99 Jun-99 Aug-99 Oct-99 Dec-99 Feb-00 Apr-00 Jun-00 Aug-00 Oct-00 Dec-00 Feb-01 Aug-98 Jun-98

19 100% 90% Do You Know How to Shop? Respondent = "Yes" 80% 70% 60% Percent 50% 40% 30% 20% 10% 0% Jun-98 Aug-98 Dec-98 Mar-99 Sep-99 Mar-00 Mar-01

20 100% Shopping: Awareness v. Understanding Responses = "Yes" Percent 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Are you Aware of Competition Do You Know How to Shop Jun-98 Aug-98 Dec-98 Mar-99 Sep-99 Mar-00 Mar-01

21 PJM Spot Market Monthly Average Energy Price Results $100 $90 $80 $70 $60 $50 $40 $30 $20 $10 $0 $/MWh Jan-99 Feb-99 Mar-99 Apr-99 May-99 Jun-99 Jul-99 Aug-99 Sep-99 Oct-99 Nov-99 Dec-99 Jan-00 Feb-00 Mar-00 Apr-00 May-00 Jun-00 Jul-00 Aug-00 Sep-00 Oct-00 Nov-00 Dec-00 Jan-01 Feb-01 Mar-01

22 On-Peak Spot vs. Forward Prices Comparison of Last Settlement Price before Contract Month to Actual Avg. Spot Price $180 $160 $140 $120 $/MWh $100 $80 $60 $40 $20 $0 JAN99 MAR99 MAY99 JUL99 SEP99 NOV99 JAN00 MAR00 MAY00 JUL00 SEP00 NOV00 JAN01 MAR01 Contract Forward Price Monthly Avg On-Peak Spot Price

23 PJM Forward Market , 2000 & Jan Feb Mar April May June July Aug Sept Oct Nov Dec

24 PJM Daily Capacity Credit Market January March 2001 $/mw-day Jan-99 Mar-99 May-99 Jul-99 Sep-99 Nov-99 Jan-00 Mar-00 May-00 Jul-00 Sep-00 Nov-00 Jan-01 Mar-01

25 PA Gas Switching Statistics as of 04/01/01 Company Columbia Dominion-Peoples Equitable NFG PECO PG Energy PPL T W Phillips UGI Valley Cities-NUI Total Total Residential Customers 355, , , , , ,022 65,281 54, ,762 4,412 2,034,828 Residential using Alternative Suppliers 94, ,399 18, ,765

26 $10 $9 $8 $7 $6 $5 $4 $3 $2 $1 $0 Henry Hub Natural Gas Spot Prices $/mmbtu Apr-98 Jul-98 Oct-98 Jan-99 Apr-99 Jul-99 Oct-99 Jan-00 Apr-00 Jul-00 Oct-00 Jan-01