State renews power service plan

MILFORD — State and utility officials say that Milford area power rates will continue to fall, following a recent decision by the state’s Public Utility Commission. The commission last Thursday approved a settlement extending alternative power service for Pike County Light and Power (Pike Power) customers. The alternative, termed a “default service implementation plan,” is managed by Direct Energy. “This program is evidence that competitive markets operating under the right structure (do) work,” said Mike Beck, vice president and general manager for Direct Energy. “Four years ago these customers were paying almost 30 percent more for their electricity, but are now experiencing savings because they have access to prices reflective of the competitive market.” The Commission unanimously approved a settlement to extend the alternative, a “fixed-price aggregation program,” for an additional two years, starting June 1. It also provides for a back-stop, spot-based, default service with quarterly-price adjustments for those customers who chose that option during this extension period. Direct Energy says existing program participants will automatically be rolled over to the new rate on June 1. Those currently not enrolled can sign up now at the current aggregation price of $0.11937 per kwh and be converted to the $.098 per kwh rate in June. Letters regarding specific details of the program will be mailed to PCLP service territory residents and small businesses in the spring. The settlement was reached between the parties in the case including Pike Power, the state’s Office of Consumer Advocate, the commission Office of Trial Staff and other formal complainants. “We commend the parties for their diligent work in resolving the immediate issues in this proceeding and for recognizing that settling this case quickly would provide Direct Energy the opportunity to take advantage of securing lower energy prices for the majority of Pike’s customers,” said Commissioners Robert F. Powelson and Wayne E. Gardner in a joint statement. The Pike Power service territory is one of the few markets in Pennsylvania where rate caps have expired, and where suppliers are solicited to compete for the business of customers through various product, service and pricing options. Direct Energy, based in Toronto and Houston, has over 5 million residential and commercial customer relationships in 22 states, plus the District of Columbia and 10 provinces in Canada. It is a subsidiary of Centrica plc (LSE: CNA). To learn more about Direct Energy, visit www.directenergy.com. How did we get here? In April 2006, the commission approved an aggregation program where all Pike Power customers were automatically enrolled with a competitive supplier. The aggregation program pooled Pike Power electric consumers for the purpose of purchasing electric power collectively. Customers could opt-out of the aggregation program and remain with Pike Power. Last May, Pike Power filed a petition for approval of a new default service plan whereby the company will secure its default service supply. The plan is designed to replace a 17-month default service implementation plan, which will end May 31 of this year. The 1996 electric competition law requires electric companies, or a Commission-approved alternative supplier, to provide default electric generation service to customers who have not selected an alternative generation supplier. The default service prices for electric generation service are required to result in a procurement strategy to produce the least cost to customers over time.