Restructuring Today
August 25, 2006

What risks will NYSEG really take -- if any?

NEMA's Goodman sees PSC decision as opportunity for marketers

The commission's decision implemented a "generous transition period" for NYSEG in particular and consumers in light of the fact that 88% of the customers had been defaulted into a NYSEG "price protection plan" that had a 35% premium on top of market prices, NEMA's Craig Goodman reminded us.

          The commission "wisely" stopped NYSEG from enrolling ratepayers who did not affirmatively choose to pay these higher prices, he said.

          The order took NYSEG's request for a $96 million rate hike and instead converted it into a $36 million rate dip, he pointed out.

          The PSC has ordered as well $77 million in refunds from prior asset sales.

          NEMA thinks it would be a great public service if the commission clarified:

            What if any risk NYSEG is to take;

            Why NYSEG Solutions instead of NYSEG itself should offer this product, and

            When will the apples-to-apples comparison that the commission has long sought be implemented so that utility bills are transparent and understood by average customers.

          Goodman personally doesn't know any consumers who understand what they are buying based on their bills.

          Most customers are buying products, services and technology that they do not want, need nor can afford if given a choice, he argued.

          Marketers would like to give all consumers that choice and Goodman sees the PSC policy as a great opportunity for marketers to offer better products.

          NYSEG will only be offering a one-year, fixed-price product because the PSC's order is transitional, Goodman observed.

          NEMA members have in the past offered five-year, fixed-price products, he added.

          Thus this could end up being a "very good" year for marketers and consumers in New York State.

© 1997-2006 ghi, Washington, DC, USA. All rights reserved.