Delmarva Power holds energy expo

By Jonathan Starkey
Staff Reporter

On Wednesday, Delmarva Power officials organized an Energy Efficiency Expo at Delaware Technical and Community College’s Georgetown campus, introducing Delaware-licensed energy suppliers to their commercial customers.

Nine energy suppliers set up booths in the campus’ William Carter Partnership Center, talking mostly with Delmarva Power’s medium to large commercial customers about ways to save through a third-party supplier.

“There has been a lot of publicity surrounding the rising costs of energy,” said Jim Smith, Delmarva Power’s public affairs manager. “We thought it would be good to do some proactive outreach.”

Residential and small commercial Delmarva Power customers are facing a proposed phase-in plan to help ease the electric rate hikes that are expected on May 1. According to House Bill 4 — which was still in the House Energy Committee as of Tuesday — that plan would call for three incremental hikes rather than the originally-proposed 59 percent hike on May 1.

Smaller customers, according to the Bill, would see a 15 percent electric rate increase on May 1, a 25 percent increase on Jan. 1, 2007, and a 19 percent increase on June 1, 2007. They would then pick up the balance of the deferred hike on Jan. 1, 2008, essentially paying interest on a collective $60 million Delmarva Power loan and completing the phase-in process.

Medium to large business customers — such as most restaurants and school districts — might not be so lucky. On May 1, Delmarva Power rates are expected to increase for those customers by about 60 percent to 117 percent.

The energy suppliers in attendance on Wednesday explained why buying through a third-party could save these businesses money on energy costs.

“Prices are dictated by when you buy the supply,” said Daniel Fritts, a representative from Hess.

Delmarva Power accepted bids in December and January to purchase its energy. It then awarded one- to three-year fixed-price supply contracts in February to six companies based on December and January’s market value prices for energy, according to Delmarva Power spokesman Matt Likovich.

Those prices, however, continue to fluctuate daily, said Kurt Backert, a sales executive from ConEdison Solutions, a New York-based energy supply company.

ConEdison, he added — like the other suppliers in attendance — is able to offer current market prices and “pricing options” to Delaware customers. A portion of the bill, for instance, can be fixed while another portion could be floating with the market prices, he added.

According to Pepco Energy Services documents, offering Feb. 21 market energy prices, for instance, would translate into a 28 percent savings from proposed rate increases for Delmarva Power large general-service customers.

That versatility “brings a feeling of comfort,” Backert said. “That’s what people want.”

Since Delaware’s General Assembly deregulated but capped energy rates in 1999, prices for oil, coal and natural gas in particular have continued to skyrocket, causing high supply contracts and increases in electric rates when the rate cap is lifted on May 1.

According to Likovich, the Delmarva Company has seen a 150 percent increase in the cost of coal, a 300 percent increase in the cost of oil and a more than 400 percent increase in the cost of natural gas since 1999.

“We’re at the mercy of the market,” Likovich said in a recent interview. “Fossil fuel prices are the primary driver of electric rates. We’re going from what conditions were in 1999 and fast-forwarding seven years.”

Third-party suppliers

Below is a list of the energy suppliers who had representatives in attendance at the Delmarva Power-sponsored Energy Efficiency Expo in Georgetown on Wednesday. According to a document available on Wednesday, most suppliers are not willing to work with residential customers because of the current regional market. Business customers are urged to call the numbers listed for possible savings on electric costs as related to Delmarva Power proposed rate increases, starting May 1.

Constellation New Energy: 1-888-638-8900
Direct Energy Services, LLC: 1-866-983-0800
Amerada Hess Corporation: 1-800-HESS-AOK
Pepco Energy Services, Inc.: 1-800-ENERGY-9
Select Energy, Inc.: 1-888-810-5678
Sempra Energy Solutions: 1-877-2SEMPRA
Washington Gas Energy Services, Inc.: 1-888-236-9437
UGI Energy Services: 1-800-427-8545
ConEdison Solutions: 1-410-458-9080