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Lack of license stalls residential co-op deal
By Jonathan Starkey
Staff Reporter
Despite what one expert called a good plan, Perry Mitchell’s attempts to negotiate a better residential electric rate for 2,500 local residents has been stalled because of a lack of correct licensing.
The Ocean View resident has talked with many individuals and homeowners’ associations in the area, who subsequently allowed him to negotiate using their numbers to make up his 2,500-account aggregate group.
But Mitchell doesn’t have the license to do so. Connie McDowell, the chief of Technical Services with the Public Service Commission, which monitors Delaware’s public utilities, told the Coastal Point on Wednesday that Mitchell needs a broker’s license to negotiate rates for an aggregate group.
“By Delaware law, whether someone takes title or not, they classify them as a broker. They have to get a license,” McDowell said.
Mitchell said that he was not informed by the PSC in initial conversations that he needed a license but plans to follow correct procedure by sending in an application in hopes of attaining commission approval.
“I wasn’t planning on it. They never said anything about that,” Mitchell said. “But if that’s what I have to do, I’ll do it.”
Kimberly August, a spokeswoman with Washington Gas Energy Services, said that Mitchell’s lack of a license is what stalled talks with that mid-Atlantic utility supplier. August said that Mitchell has talked with WGES but no formal meeting has been scheduled.
“We welcome the opportunity to explore the opportunity, but there may be some regulatory requirements for him to conduct that type of business,” she said. “At this juncture with Mr. Mitchell, no one has had a conversation about being a supplier for an aggregate group.”
Mitchell formed his residential aggregate group, which he called Consumers for Alternative Power (CAP), earlier this year to counter rising energy prices. On May 1, Delmarva Power residential rates rose about 59 percent because of rising fossil fuel prices worldwide.
After talking to homeowners and representatives from local homeowners’ associations, Mitchell began negotiating with 2,500 residential accounts and hoped to receive a rate, from WGES in particular, of less than 10 cents.
“I think that’s a reasonable expectation at this point,” said Dick Anderson, a principal with CQI Associates, who negotiated the commercial rate of 9.897 cents for the Bethany Fenwick Area Chamber of Commerce. “I think that’s a good plan.”
Mitchell and leaders from local HOA’s have worried, though, that even if Mitchell does secure a rate in the future, he won’t be able to obtain the 2,500 contracts.
“I don’t think he has the base yet,” said Bill Pinckney, president of the Forest Reach HOA — one association in collaboration with Mitchell — in an earlier interview. Pinckney added that he doesn’t think that the owners of the 58 Forest Reach homes have much interest in CAP.
“I think they’re going what most people are doing; waiting to see what happens. I don’t think they’re going to be jumping on the bandwagon,” he said.
Check next week’s Coastal Point for continuing coverage on this issue.
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