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Press Release: June 5, 1998
Energy Marketers Seeking Consumer Allies

By Mary O'Driscoll correspondent

The advent of competition and customer choice in natural gas and electricity markets has led to the rise of new kinds of companies that want to offer all consumers -- residential, commercial and industrial -- what is expected to be a dizzying array of energy products, services and technologies.

Those new kinds of companies are called energy marketers. And they have their own advocacy organization in Washington, D.C.: the National Energy Marketers Association (NEMA). Craig Goodman is president of the non-profit organization whose goal is to help devise fair, meaningful ways to implement customer choice and competition in natural gas and electricity markets around the country. recently interviewed Mr. Goodman about his organization and the coming competition that will change how consumers buy and use their electricity and natural gas. Probably the most-asked question we get is from people who are worried that marketers are going to call them during dinnertime to try to sell them electricity, as long-distance telephone companies do. Will that be the case?

Goodman: Not from NEMA members. The first thing we did as an organization was to adopt a detailed Uniform Code of Conduct for all marketers across the country. Unfortunately, not all marketers will be NEMA members. But the hope is that as consumers start to learn more about energy deregulation they will make sure they ask their energy supplier if they are a NEMA member before they do business with them.

Key points within our code of conduct are to refrain from abusive and intrusive sales practices and to scrupulously safeguard privacy and confidential information. Our members are the largest and more honorable companies in this business and it is in our best interest to help regulators identify "bad actors" within the industry and help regulators make rules that will drive them out of the marketplace. With customer choice and competition now under way in many parts of the country, what is the biggest hurdle we have to get over to ensure that customers will see the benefits of competition?

Goodman: We have to ensure that consumers are permitted to purchase the energy and related services they actually want, and that hidden charges for services that they don't want are not forced upon them unknowingly. What are "hidden charges?"

Goodman: Typically, as markets become restructured, there are a number of hidden charges that are built in to the deregulation process, which most consumers are not aware of. For example, besides utilities' stranded costs, many customer choice programs are requiring customers to buy reliability that they don't need, and social programs that are built into the price of energy that consumers are not generally aware of. Utilities have historically been major tax collectors and social program administrators. The move to a deregulated market is challenging those vested interests that want to maintain both the tax base and the social programs of yesteryear. There will be fewer and fewer ways to hide these charges, or taxes, as we move toward a deregulated market. You sound a lot like a consumer advocate, yet you're representing energy marketers -- businesses. Aren't there consumer advocates out there already? What is it NEMA is trying to do?

Goodman: There are so many different types of competing consuming interests, it is impossible for any one to represent all of them. NEMA represents those who want to service virtually every type of consumer.

We provide a vantage point, and would welcome all classes of consumers to work with us to advocate the most pro-competitive consumer rates, tariffs and services as possible.

So, believe it or not, the person who actually has to sell competitively, and deal with all of the intricacies of the rules from the wellhead to the burnertip or lightbulb, is inherently going to have the consumer's interests at heart -- or he is not going to be able to deliver the highest quality, lowest cost energy and related products, services and technology possible, and therefore be competitive. The competitive marketer is perhaps the consumer's best ally.

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