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EnergyWindow MarketElert TM - February 2005
www.energywindow.com
February Elerts
Maryland -
The Standard Offer Service (SOS) auction is still under way. But with two out of three rounds of bidding finished, there is indication that new prices for Type II accounts (up to 600 kW) may see increases of up to 18% based on the rise in wholesale prices year to year. Final tariffs for June 1, 2005-May 31, 2006 are due out on March 15, but suppliers are already making offers. All Type III customers (>600 kW) will be charged an hourly wholesale rate plus an adder of between $2.25 and $3.00/MWH beginning in May.
Michigan/DTE -
Analysis of D3, D4, and D6 rate class sample accounts reveals increases of 8.0 to 8.5% in the new unbundled tariff rate (price to compare), which resulted from the final DTE rate relief order in Case U-13808 issued in November. If a) you haven't been off tariff previously; or b) were and did not give notice in December of your intention to return next summer to tariff, you will want to solicit bids from competitive suppliers this spring.
ComEd Period A Market Prices Announced
Even in a nation brimming with an astonishing diversity in its retail electric markets, Commonwealth Edison (ComEd) in Illinois stands out as one of the most interesting and complex regions in terms of language and supply options. Commonwealth Edison (ComEd) has released the new Market Value Energy Charges (MVECs) and Customer Transition Charges (CTCs) for the June 2005-May 2006 period (Period A to the initiated). These are two of the most important (but by no means only) components that help determine what the effective "price to compare" will be for end-users choosing to shop for electric supply.
|
Period A |
Price to Compare
($/mwh) |
|
2004-2005 |
2005-2006 |
Increase |
|
GS non-TOU PPO |
$ 41.15 |
$ 47.85 |
$ 6.70 |
|
GS non-TOU Unbundled |
$ 41.72 |
$ 49.63 |
$ 7.91 |
|
GS TOU PPO |
$ 48.30 |
$ 57.22 |
$ 8.92 |
|
GS TOU Unbundled |
$ 56.30 |
$ 64.20 |
$ 7.90 |
|
Simple Average |
$ 46.87 |
$ 54.73 |
$ 7.86 |
|
Customers in ComEd have three choices for electric supply; a bundled rate fixed through December 31, 2006, a Purchased Power Option (PPO) that passes through a market price for energy, and retail supply through a third party. The bundled rate is frozen until December 31, 2006, so if the CTC component rises, the effect is that the energy component is lowered by the same amount. The PPO rate has been available only to customers whose CTCs have been greater than zero. This year customers above 400 kW that had CTCs of roughly $7.00 to $8.00/MWH will see those CTCs go to zero, meaning they need to compare a retail price to the bundled rate. We ran prices for a set of GS commercial accounts with less than 400 kW peak demand and saw their effective price to compare rise between $6.70 and $8.92/MWH as shown in the table. Bottom line is this: get ready to look for prices - and savings - in ComEd territory in time to give notice on or before April 18, the end of this years "shopping season", with switching occurring with the May meter reading. And with softer gas prices leading the way to lower electric futures prices, sooner may be better.
Quick Buyers' Tip
In energy supply management, it pays to be ready to move quickly when markets present savings opportunities, and not to wait for the "best" opportunity. Here's a real example: one Fortune 600 client company that participated in the EnergyWindow PowerPurchaseTM gas procurement event in September, 2004, moved quickly to execute contracts that would save $0.86 per mmBTU on basis on average for indexed contracts relative to the local distribution company default gas price for facilities in six states. That savings, which represents roughly 11-13% of total gas costs (for $6.00-7.00 per mmBTU gas), is expected to produce a cost reduction of $97,000 per year for the buyer. In addition, because they were able to also "trigger" a fixed gas price before Hurricane Ivan hit the Gulf of Mexico in mid-September and drove gas prices substantially higher, the buyer was able to realize even greater savings. The lower fixed price of approximately $0.84 per mmBTU, translates into more than an additional $35,000 during the October 2004-January 2005 period.
Free Market Data and Information Available Here!
EnergyWindow has a wealth of free energy data and information available on our site. Simply follow the link above, register if you haven't already and you'll get instant access to wholesale and spot market energy prices, a searchable database of energy-related articles, links to energy career sites, supply reserves, weather, securities information, the MarketElert archives and much more. It's all there, available 24x7 and, best of all, it's free!
Massachusetts Businesses: Act Now To Avoid Electricity Rate Increases After February 28, 2005
Copyright © 2005 EnergyWindow, Inc. All Rights Reserved.
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