What is Energy Choice?
Should a simply question not have a simple answer. Why is the sky blue? How does electricity get to the outlet?
We live in a market driven society but the idea of shopping for energy suppliers can seem baffling.
Answers can illuminate complex relationships, convey a simplified understanding or seek to explain the purpose.
So why do we have energy choice? Let’s look at 3 such answers:
- Regulating the monopoly utility for energy purchases was shown to be more costly (customers could save money)
- It allowed market conditions to set the price, as in supply and demand
- Energy Choice created new businesses and offered customers new energy purchasing options
Of course the bottom line in Energy Choice:
SUPPLIER: Obtains sources of energy for you
UTILITY: Delivers your energy to you
Realgy Energy Services is a registered Retail Energy Marketer in the states of Illinois, Michigan and Indiana. We offer Service Plans that will provide electric and natural gas at wholesale pricing direct to customers without any utility markup. Our Service Plans work with the local utility to provide seamless service and annual energy savings. Service Plans include Guaranteed SavingsTM, ManagedPriceTM, ManagedGreenTM Index, Fixed and PriceAssuranceTM.
Additional Information:
DOE EIA Weekly Gas Storage Report
Working gas in storage was 3,339 Bcf as of Friday, August 12, 2016, according to EIA estimates. This represents a net increase of 22 Bcf from the previous week. Stocks were 327 Bcf higher than last year at this time and 405 Bcf above the five-year average of 2,934 Bcf. At 3,339 Bcf, total working gas is above the five-year historical range.
Estimated Injection 28 Bcf
VS
Actual Injection 22 Bcf
The US Energy Information Administration is expected to estimate a 28-Bcf injection into natural gas storage facilities for the reporting week that ended August 12, according to a consensus of analysts surveyed by Platts. The expected injection would be much less than the 56-Bcf injection reported at this time in 2015 as well as the five-year average, which is a 57-Bcf build, according to EIA data. The below-average build would mark the 15th consecutive week that weekly injections were significantly less than the historical average and last year and would continue to shrink the storage surplus. Analysts’ estimates in the survey ranged from an injection of 23 Bcf to 35 Bcf. An injection of 28 Bcf would grow stocks to 3.345 Tcf, 333 Bcf more than the corresponding week last year and 411 Bcf more than the five-year average
Lansing, MI utility plans to replace coal plant
The Board of Water & Light’s Board of Commissioners are deciding how to proceed with the city-owned utility’s first long-term strategic plan since 2008. The proposal could include a second new natural gas-fired electric plant, this one to replace the outdated Eckert Plant that is scheduled to close by 2020.
The board, in setting such policy, is unleashing market forces to respond. When this coal plant was built, it competed with nothing. That’s right; built in 1950, coal was the only choice. Today, wind, solar, natural gas and nuclear are all competitive. In addition, taking into account environmental factors is now evident in energy planning.
Congratulations to Lansing’s Board of Commissioners; who are setting policy reflective of the current technology and environmental knowledge.
Realgy Energy Services is a registered Retail Energy Marketer in the states of Illinois, Michigan and Indiana. We offer Service Plans that will provide electric and natural gas at wholesale pricing direct to customers without any utility markup. Our Service Plans work with the local utility to provide seamless service and annual energy savings. Service Plans include Guaranteed SavingsTM, ManagedPriceTM, ManagedGreenTM Index, Fixed and PriceAssuranceTM.
Additional Information:
http://www.lansingstatejournal.com/story/news/local/2016/08/17/bwl-strategic-plan/88864244/
DOE EIA Weekly Gas Storage Report
Working gas in storage was 3,317 Bcf as of Friday, August 5, 2016, according to EIA estimates. This represents a net increase of 29 Bcf from the previous week. Stocks were 361 Bcf higher than last year at this time and 440 Bcf above the five-year average of 2,877 Bcf. At 3,317 Bcf, total working gas is above the five-year historical range.
Estimated Injection 25 Bcf
Vs
Actual Injection 29 Bcf
After an extremely rare summer withdrawal to gas in storage was reported last week, analysts expect Thursday’s estimate to return to a build, albeit one still well below the historic norm. The US Energy Information Administration will estimate a 25-Bcf injection to natural gas in underground storage for the reporting week that ended August 5, according to a consensus of analysts surveyed by Platts. The EIA plans to release its weekly storage report at 10:30 am EDT Thursday. The expected injection would be less than half of both the 57-Bcf injection reported at this time in 2015 and the five-year average injection of 53 Bcf, according to EIA data. The below-average build would mark the 14th consecutive week the injection was less than the historical average and would continue to cut into the storage surplus. Analysts’ estimates in the survey ranged from a 21-Bcf injection to a 29-Bcf injection.
DOE EIA Weekly Gas Storage Report
Working gas in storage was 3,288 Bcf as of Friday, July 29, 2016, according to EIA estimates. This represents a net decline of 6 Bcf from the previous week. Stocks were 389 Bcf higher than last year at this time and 464 Bcf above the five-year average of 2,824 Bcf. At 3,288 Bcf, total working gas is above the five-year historical range.
Estimated injection 1Bcf.
Vs
Actual withdrawal 6Bcf.
The NYMEX September natural gas futures contract jumped 10.6 cents Wednesday to settle at $2.839/MMBtu, boosted by expectations of an atypically small injection into US natural gas storage in the latest reporting week – or possibly even an historic summer withdrawal. “The contract is up because a storage withdrawal is possible, which would make it the third summer draw in history,” said Kyle Cooper, analyst/principal, IAF Advisors. The consensus estimate of analysts surveyed by S&P Global Platts is for an injection of 1 Bcf into underground storage that week, but analysts’ estimates in the survey ranged from a withdrawal of 4 Bcf to an injection of 5 Bcf. The consensus estimate of 1 Bcf would be much less than the 41-Bcf injection reported at this time in 2015 and well below the fiveyear average of 54 Bcf, according to EIA data. A below-average build would mark the 13th consecutive week the injection was less than the historical average. It would also be a new record low for this time of year.
Start-Up Retail Supplier Won’t Make Profit on Power Sold, Will Charge Fixed Membership Fee Instead
So the old saying is; wheel goes round and round.
In the OLD Days, only the utility (regulated monopoly) sold power (and distributed it). The utility was not allowed to make a profit on selling power; they could only recover their costs (which were reviewed by the regulators and deemed reasonable).
Deregulation days: energy marketers competed with the utility and each other for supply power to customers. The utility distributed the supplied power. The result: energy marketers were able to reduce customers costs of energy. Illinois’ recently cited 37 billion in savings from energy marketing.
In the 20+ years since deregulation has been rolled out, we are moving back to towards a utility model. In part, because marketing has overtaken the role of education. Most regulators and utilities do not proactively educate their customers in their service options (that is, energy choice is a utility program that is supported by the utility as an option to the utilities’ default service). Therefore, sales tactics or marketing is supposed to educate consumers while selling the service.
Wholesale buying groups, such as COSTCO or BJ, are emerging for energy buying. Wholesale buying club pitch: we don’t profit from energy sales (sound familiar). The fine print: we charge a fixed fee for services. An interesting evolution but confusing all the same. The reason, the use of “wholesale” market is not a uniform description. The term “wholesale” could be used to describe any of 20-100 different energy products and price points. This approach capitalizes on an establish retail sales concept that when applied to energy it appears misleading.
Energy marketing is a proven method of lowering a customer’s retail energy cost and providing value. The evolution of marketers toward adopting the older utility model is recognition of the maturing of retail marketing. Hopefully, the utilities and regulators see the need for proactive education and not reliance on competitors to education and sell simultaneously.
Realgy Energy Services is a registered Retail Energy Marketer in the states of Illinois, Michigan and Indiana. We offer Service Plans that will provide electric and natural gas at wholesale pricing direct to customers without any utility markup. Our Service Plans work with the local utility to provide seamless service and annual energy savings. Service Plans include Guaranteed SavingsTM, ManagedPriceTM, ManagedGreenTM Index, Fixed and PriceAssuranceTM.
Additional Information:
http://www.energychoicematters.com/stories/20160628a.html