In 10 years, your job probably won’t exist
Happy New Year, the future continues!
So with that in mind, here is an interesting question…will your job (career) exist in 10 years, how about 20?
Change is relentless and with the new comes obsolescence.
In energy, the prediction has been that solar will continue to advance in price and efficiency. While this is true, other technology is not standing still.
· The internal combustion engine (cars, trucks, buses, electric generation) is getting more efficient. The US Government has set the average fleet MPG at over 50 within the next 15 years. Currently, it is around 30 MPG.
· Light bulbs have radically changed, such that the incandescent is no longer available. The average LED light bulb will operate continuously for 5 years and would consume less energy over those 5 years than 1 incandescent light bulb operating for just 6 months. In the US, adoption to all LED light bulbs could eliminate the need for over 80 coal fired power plants.
· Of course, fracking has changed the landscape of the oil industry and has cut US importing oil by nearly 30% over the last 5 years.
So change touches us all. It’s exciting to forecast into the future and equally exciting to see it be wrong and right!
Cheers to change.
by David Tuffley a lecturer in applied ethics and socio-technical Studies at Griffith University
COMED and Ameren Raise Rates
Ameren and COMED have raised their delivery service costs. The following increases will take effect in January 2015:
Ameren up 17.4%
COMED up 11%
MidAmerican announced last month an increase of nearly 11%.
Realgy Energy is a wholesale energy provider that allows you to purchase your energy without the utility markup. The result; we save our customers money.
Additional information on our service is available at;
For COMED: http://realgyenergyservices.com/service-plans-53/
For Ameren: http://realgyenergyservices.com/service-plans-57/
For MidAmerican: http://realgyenergyservices.com/service-plans-58/
We serve residential and commercial customers.
The following is a link to the news announcement
http://www.thenewstribune.com/2014/12/12/3537665/ameren-comed-get-ok-to-raise-rates.html
How to Get a Good Deal from an Energy Marketer
I am often asked how to get a “good deal” in choosing an energy supplier?
In the past, my answer typically began with an explanation of how “deregulation” or “customer choice” developed (which gets me glassy-eyed looks), which was followed by general advice such as: determine the quality of supplier; review the terms and conditions and then the pricing.
However, as we are having renewals with our customers reoccurring for the 4th, 5th and 6th time, I think what these customers have told me is more relevant….
In addition, during our 12+ years we seen many, many processes from consultants, aggregators or in request for proposals, I have consolidated these experiences into what I believe is a list of best practices;
1. Assemble a copy of all your bills (either electric or gas) including the following (this will help you eliminate or question what a marketer sends you in step 2).
a. Identify the energy cost on the bill(s).
b. Identify the delivery cost on the bill(s).
c. Add up the total energy used (either kwh for electric or Therms for natural gas) for 1-12 months, pairing each month with the energy cost (the delivery cost will not change).
2. Contact marketers and ask them for a proposal for service.
a. A list is available at: http://realgyenergyservices.com/customer-services/web-links/ under each utility.
b. Eliminate the ones who do not reply.
c. For ones who reply, ask for a comparison for at least the last 12 months of how their proposal price compared to the utility cost. Again, eliminate those who do not respond.
d. Look at how the marketer’s pricing and the utility pricing are presented.
IN MANY CASES marketers may be above a utility in some months; they should be able to explain why.
AVOID those that are above the utility for 12 months in a row.
AVOID those marketers whose comparison does not accurately show the utility cost.
3. With the marketers who responded and sent you their pricing comparison, ask for their terms and conditions (contract or Agreement). Read their agreements paying special attention to the following;
a. Pricing; is it defined, how long does it last, and what happens when it ends?
b. Quantity; if you’re buying a fixed price make sure it says how much gas you’re buying at the fixed price and what happens if you use more or less than that amount. If you’re buying a variable rate, it should state it’s for all your usage or “open” quality.
c. Renewal; when do you have to give notice to terminate, what happens if you don’t?
d. Additional Services: is storage included, what about changing plans (from variable to fixed), taxes, service fee, online access, answered customer service (vs. automated attendants), etc. Some additional service is worth the price, some are not.
While not an official step, there are good reasons to eliminate a marketer from consideration (in other words, absolutely avoid), such reasons include;
a. No trade references or BBB accreditation.
b. An initial rate (fixed or variable) that lasts only 1-6 months and renews which is followed by a different (perhaps) vaguely defined price. These are known as “teaser” rates and will inevitably cost you more than the utility.
c. Language that doesn’t make sense is not clear in its intent or clearly favors the marketer.
d. A renewal date scheduled during the winter or summer. Make sure you can terminate your agreement for natural gas or electricity in April or May. This will give you the best period to switch or renew during a “low” energy usage period when pricing is more stable and you will not be under pressure to continue the agreement.
Tell Ameren to open up their natural gas service to Customer Choice
So Ameren wants you to believe that you are paying a “low” “stable” price for your natural gas. Well, if you compare their cost to the entire United States, they may have a point.
However, if you compare to your neighbor or local supplier you are paying more. That is; if your neighbor or business is with Realgy Energy Services.
Ameren is trying to retain its regulated monopoly position in natural gas by putting out these press releases saying; “we are AVERAGE!”.
So compare what happened in Illinois when electricity was opened to customer choice: the State of Illinois has saved $37 billion with Energy Choice; that’s compared to what you would have paid by staying with the utility (like Ameren, COMED, Peoples, etc).
Specifically Realgy Energy Services customers over the last 36 months have saved over 14.7% compared to Ameren; that is over $889.00.
Let them know you want the same choice for natural gas as you have for electricity. ICC contact info: Torsten Clausen, Director tclausen@icc.illinois.gov
So as Ameren promotes being average in the USA, you can look to be better and tell Ameren to open up their natural gas service to Customer Choice.
Read the full Ameren Media Release, “Ameren Illinois Customers will see natural gas prices lower than national average for a second year“
Duke Energy proposes plan to modernize electric grid
Duke Energy’s proposal for maintaining/updating their electric grid in their franchise service area of Indiana is a great example of a regulated utility’s typically large improvement process.
First step; maintain the current system without improvement for as long as practical. This is usually cost effective in keeping rates low but comes with the cost of more frequent outages and high system maintenance costs.
Second step; offer to upgrade an outdated (in this case a century old) technology. After nearly 100 years without significant changes, you would think there would be benefits in replacing old technology. The highlighted benefits would be expected; however, note the absence of any measurable benefits.
Third step; get paid. Regardless of what benefits actually occur, Duke will be guaranteed 80% recovery of their costs (not estimates, but what they actually spend). The remaining 20% will be included in a new filing that is subject to regulatory review. The regulators could disallow recovery of this 20% if they found Duke did not spend the money prudently or that the intended benefits did not materialize.
Bottom-line, this will most likely be approved. The rates will increase and service should be improved. Correlating cost vs. benefits is always a challenge.
Indiana is an outlier in the area, as they do not have customer choice for their electric service as neighboring states do. One would hope that with consideration of a modern electric grid, a modern energy choice program would precede it. And, with a modem energy choice program, there is no rate increase.
Realgy offers electric choice in Illinois where the average savings is over 8%.
Read the full Intelligent Utility article “Duke Energy Indiana proposes plan to modernize its statewide electric grid.”
MidAmerican Energy seeks rate increase in Illinois
Twenty-two years without a raise—think about it. That would be very hard. However, utilities do not operate at a fixed cost; they operate as a regulated monopoly (like the game) and receive a fixed rate of return. That is, utilities get to spend what is necessary to provide service and seek approval for those costs. Utilities like MidAmerican earn a regulated rate of return (in business that’s called margin) on everything they spend (subject to approval).
So, although MidAmerican-Illinois (MEC) has not increased energy costs during this time, they have spent $289 million on improvements to the electric grid and their generators. If this were all spent as required to provide service, then MEC which earns about 9% rate of return, would earn about $26 million a year in profit.
So after 22 years, an increase of 21% for residential and 13% for business might not seem like a lot, but remember MEC has no competition and earns profit on spending money to provide service.
Can you avoid the rate increase? The short answer is yes.
Illinois customers of MidAmerican Energy can now participate in the Illinois Electric Choice Program. The idea is simple; provide customers the right to buy their electricity directly from suppliers without any additional cost from the local utility. The result has been savings for Illinois consumers—an estimated $37 billion dollars due to electric competition.
Realgy Energy Service is the first energy marketer registered with MidAmerican Energy-Illinois enrolling customers in the Illinois Electric Choice Program. Additional information is available at Service Plans for MidAmerican.
Electric wholesale prices to rise by 9 times overall since end of Winter 2014
We ask “what is going on with electric prices?”
PJM is essentially the wholesale market for electricity in ComEd. They will request bids from generators (electric generator owners) every year for the next three years. PJM issued a press release announcing the results of their most recent auction.
The press release shares some interesting highlights such as “increased diversity” even though they acknowledge the trend to more gas-fired generation.
However, the bigger issue is that the cost of the bids increased dramatically over the next year, rising from $27.73 in 2014 to over $136 by the end of 2015. This nearly 900% increase will be passed thru to all retail customers. We have already seen about 50% of this increase.
This projected increase does NOT appear to be directly related to the winter “vortex” of 2014. However, given the timing of PJM’s bid (just after winter) and the trend to more gas-fired generation, some link shouldn’t be dismissed. Last winter reminded energy traders, power generators, utilities, and energy marketers of the extent of their reliance on certain pipelines. The demand on these pipelines is increasing (by both gas-fired electrical generation and through population growth). Therefore, as the wholesale price increases, we will be starting at a higher price next winter. If winter or summer weather spikes, we could see even greater pricing than last winter.
Realgy offers fixed pricing to reduce the effect of seasonal weather by offering a winter or summer fixed price. This allows our customers to avoid paying a premium for a fixed price when they don’t have to. Please call your Energy Broker or see our PriceWatchTM service at http://realgyenergyservices.com/request-for-service/pricewatchtm/
Read the full PJM press release, “PJM Capacity Market Secures New And Diverse Resources To Meet Future Electricity Demand”.
Illinois continues to use legislation to pursue energy policy
Illinois has current legislation on renewal energy that sets aside a percentage of supply; that is, a percentage each year of the total energy used in Illinois must come from renewable (wind or solar) generation sources. However, the spirit of this program relies on the utilities passing through the costs of acquiring the renewable energy to their customers. Customer Choice, municipal aggregation, and the IPA itself changed how the utility acquires power for their customers (which is dwindling due to choice and municipalization). Therefore the current renewable legislation’s intent has been blunted.
This effort seems to be another bite of the same apple. Renewable energy should be supported by open and competitive process and we are heartened to see that this legislation will be overseen by the ICC. Past legislative efforts have bypassed the ICC’s oversight and expertise in favor of the utilities (real-time metering) or municipalization (allowing towns to aggregate energy purchases).
Realgy owns 120 kw of solar energy in Illinois and invests annually in the creation of new renewable solar projects.
Read the whole Crain’s Chicago Business article, “Here comes the sun: Rooftop solar panels get jump-start in Illinois”.
Chicago homeowners could get ZAPPED
Electric prices need not be confusing. The primary reason we have regulated utilities is for efficiency, no duplicate wires or pipes. Offering electric choice does not change this. Electric prices have always been controlled by rather confusing processes called tariffs (akin to IRS taxes) because it was, and is a regulated monopoly. THE REGULATORS are in charge of the process; utilities must prove they spent money according to the tariff so they can get it repaid. Customer choice does not change this relationship between regulators and the utility; it just adds a new player—the retail energy supplier.
Having energy choice need not confuse customers. The regulators need to continue balancing customer choice against their desire to have a regulated market without innovation or price volatility.
Realgy believes in open competition and easily understood explanations of energy offers. Realgy offers energy prices that show a savings compared to the utility, offers fixed pricing during seasons, and offers to beat or match any competitor’s offer.
Check out our current prices that will show you our price as compared to the utility for every market we serve.
Read the whole Chicago Business article, “Emanuel’s power pact could zap Chicago homeowners”.
“Bait And Switch” Leads to Prison Sentence
Manufacturing companies once practiced this technique of promising one product while delivering something cheaper. In this day and age, this kind of activity is a crime in any business.
This may act as a wake-up call, a “coming of age” issue for the energy industry. Previously there were few energy suppliers and most trusted their own employees to be transparent and honest. The proliferation of energy suppliers combined with the use of third parties to sell has the unfortunate effect of increasing the chances of such dishonesty and greed.
I am glad to see that it was dealt with in a severe manner because unscrupulous practices will continue if not caught and prosecuted.
Energy supply services are unique amongst most other businesses in that regulatory protection as well as consumer protection helps guard against abuses.
Read the full Retail Energy article, “SHOCK: Broker Agent’s Electricity Rate ‘Bait And Switch’ Leads to Prison Sentence”