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Another Voice: Consumers benefit from choice in electricity supplier

By Bryan Lee

When it comes to the purchases we make, we have choices. The supermarket shelves offer a dizzying array of products designed to meet our desire for choice. But in many states outside New York, consumers don’t have a choice when it comes to purchasing the energy they use to light and heat their homes and businesses.

More than 1.2 million New York residential consumers have embraced their right to choose a competitive electricity supplier. That’s roughly one in five residential customers. The percentage is much higher among commercial and industrial energy users.

Consumers in states that elected to stay with the old monopoly system of determining energy prices don’t have a choice when it comes to energy supply for their homes and businesses.

And the data show that those consumers are paying a price for that. A review by the COMPETE Coalition shows that choice consumers benefit in terms of improved price, investment and reliability.

That’s why it’s perplexing that in February the New York Public Service Commission moved to restrict choice in energy for residential consumers. Although well-intentioned and grounded in a desire to protect customers, the commission’s order – blocked by a court in July – would have eliminated dozens of competitive energy supply options from the marketplace.

The commission’s rationale for taking choice away was that competitive energy service companies (ESCOs) didn’t always offer prices lower than the utility. However, comparing ESCOs with utilities is an apples-to-oranges exercise. Utilities offer only “plain vanilla” service with prices that change monthly. ESCOs offer a wide array of products and services to meet customers’ needs.

These include fixed prices for budget certainty, credit for energy from renewable sources, bundled energy-related services like audits and programmable thermostats, solar installations and numerous other offerings that customers want and demand. 

Taking away that customer choice runs counter to the transformative energy vision advanced by Gov. Andrew Cuomo in the Reforming the Energy Vision. REV seeks to “help consumers make better and more informed energy choices, enable the development of new energy products and services, protect the environment and create new jobs and economic opportunity throughout New York State.”

ESCOs are the state’s natural partners in realizing this vision. Rather than end energy choice, we urge the commission to continue working cooperatively with stakeholders to realize the state’s clean energy goals and the 21st century energy marketplace envisioned by REV.

Bryan Lee is communications director for the Retail Energy Supply Association, a trade group representing independent energy suppliers.

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