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Second step; offer to upgrade an outdated (in this case a century old) technology.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.
Read the full Intelligent Utility article “Duke Energy Indiana proposes plan to modernize its statewide electric grid.”
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.
The Citizens Utility Board is an excellent watchdog organization. Their warnings and advice could not be more timely and on target.
Saving energy plays a significant role in saving the environment. When you use energy, you should know what it costs and that you are treated fairly.
There are two components to an energy agreement, price and terms. As the saying goes, what looks like a good deal is a good deal UNTIL it isn’t. This winter has certainly exposed the insider terms of energy marketers’ agreements and how cost recovery works for the utility.
In some cases, the energy suppliers provide “teaser rates” that are below utility rates but only last from 2-12 months. You are sure you will stay on top of it but time passes quickly and the next time you look at your bill, you could be paying two to three times the utility price. These “teaser rates” have a reset price that is purposely vague or that you cannot discover from any public information. Then when you want to cancel, it becomes a voice, logic, and perseverance test from the automated answering system.
As this year’s winter showed everyone that terms are important, a low rate is fine IF EVERYTHING is perfect, but that’s not the world we are in.
Realgy is proud of our price, our terms, and our customer service team. We know we offer tremendous value compared not only to the utility, but also to any other energy supplier in Illinois. In fact we put it in writing in our agreement; we call it ServiceMatchTM. It’s simple; we guarantee to beat or match any comparable proposal for your service.
Illinois is implementing real-time metering and municipalization so the complexity in energy purchases is built in. However, in our role as energy experts, Realgy offers energy service that delivers savings in an easily understandable manner as compared to the COMED or Ameren. Call our sales team today, and you’ll understand the difference.
Read the full Chicago Tribune article, “Watchdog warns of ‘rip-offs’ in electricity market”
The State of Illinois is celebrating, not the ending of winter but the savings from energy deregulation.
Illinois consumers, including residential, commercial and industrials, saved a total of $37,000,000,000 as a result of opening electrical supply to competition.
Realgy Energy Service has been an alternative energy supplier in Ameren and COMED and our customer know the benefits of buying directly from Realgy.
I like the last line; “Competition works.” I guess if it didn’t we would all work for the Government, right comrade!
Read the whole Compete Coalition article, “With $37B in consumer Savings, Illinois Results Deemed ‘Triumph of Market-Based Public policy’”
Citizens Utility Board is a public advocates’ group for Illinois rate payers. Their interest is to hold utilities accountable and help oversee the costs they charge are fair, reasonable and necessary for public service.
Realgy supports CUB in holding utilities accountable that their rates increase only to cover the costs of this winter’s prices.
Realgy, unlike the utilities, has already accounted for this winter’s costs. Realgy’s prices are historically below the utilities.
*In the wake of one of Illinois’ worst winters ever, CUB is now juggling more than $400 million in rate-hike appeals: $340 million for ComEd, $57 million for Peoples Gas, $6.6 million for North Shore Gas.
*If that weren’t enough, Peoples and North Shore Gas just announced $136 million in NEW rate hikes.
PRESS RELEASE December 02, 2013 | By: Realgy, LLC
Seven Oaks Farm, Saint Charles, Ill., will soon be partially powered by a 160 solar panel PV system.
Realgy, LLC has announced the start of installation on a 37.5 kilowatt (kW) solar photovoltaic (PV) system for Seven Oaks Farm. The solar PV system will be the second of its kind installed by Realgy in Saint Charles, the first being Midwest Groundcovers in 2011. Seven Oaks Farm is a historic dairy and horse farm owned by Deborah and Helmut Jahn since 1998.
The solar PV system is being installed by Renewable Energy Alternatives of Northbrook, Illinois. This is the first solar project that Renewable Energy Alternatives has completed for Seven Oaks Farm “We are excited to be a part of this venture,” said Kacie Peters, Director of Sales and Marketing at Renewable Energy Alternatives. “The array is in a very public space and will be seen by thousands annually. We hope that this array will inspire others to know solar is possible—and practical in Illinois.”
Realgy, LLC is an alternative energy service supplier in Illinois, and will be supplying Seven Oaks Farm their electricity and selected them for this installation. Seven Oaks Farm will receive all of the solar energy produced by the panels, which will reduce their reliance on fossil generated energy produced primarily from coal in Illinois.
Once complete the Seven Oaks Farm solar PV system will produce over 49, 000 kilowatt hours (kWh) of energy annually and more than one million kWh over the next 25 years. That is enough energy to power about 2 average U.S. homes every year. The environmental benefits associated with the system will offset about 900 thousand pounds of carbon dioxide over the initial 25 years of operation.
“We are excited to announce the start of the Seven Oaks solar project,” said Michael Vrtis, President of Realgy. “Realgy made this investment as a part of our sustainable energy commitment and due to the support of Illinois Department of commerce Renewable Energy Program and the ISEA.”
Seven Oaks Farm
36W788 Red Gate Road
Saint Charles, Illinois 60175
Renewable Energy Alternatives
3670 Commercial Avenue
675 Oakwood Avenue
West Hartford, CT
PRESS RELEASE December 02, 2013 | By: Realgy, LLC
Lake County Fairgrounds, Grayslake, Ill., will soon be partially powered by a 160 solar panel PV system.
Realgy, LLC has announced the start of installation on a 37.5 kilowatt (kW) solar photovoltaic (PV) system for Lake County Fairgrounds. The solar PV system will be installed on the roof and will occupy approximately 53- by 54-square-feet of space. Lake County Fairgrounds, operated by Lake County Fair Association, is the home of the historic Lake County Fair and other quality year-round events.
The solar PV system is being installed by Renewable Energy Alternatives of Arlington Heights, Illinois. This is the first solar project that Renewable Energy Alternatives has completed for Lake County Fairgrounds. “We are excited to be a part of this venture,” said Kacie Peters, Director of Sales and Marketing at Renewable Energy Alternatives. “The array is in a very public space and will be seen by thousands annually. We hope that this array will inspire others to know solar is possible—and practical in Illinois.”
Realgy, LLC is an alternative energy service supplier in Illinois, and will be supplying Lake County Fairgrounds their electricity and selected them for this installation. Lake County will receive all of the solar energy produced by the panels, which will reduce their reliance on fossil generated energy produced primarily from coal in Illinois.
Once complete the Lake County solar PV system will produce over 49, 000 kilowatt hours (kWh) of energy annually and more than one million kWh over the next 25 years. That is enough energy to power about 2 average U.S. homes every year. The environmental benefits associated with the system will offset about 900 thousand pounds of carbon dioxide over the initial 25 years of operation.
“We are excited to announce the start of the Lake County Fairgrounds solar project,” said Michael Vrtis, President of Realgy. “Realgy made this investment as a part of our sustainable energy commitment and due to the support of Illinois Department of commerce Renewable Energy Program and the Illinois Solar Energy Association.”
Lake County Fairgrounds
1060 East Peterson Road
Grayslake, Illinois 60030
Renewable Energy Alternatives
3670 Commercial Avenue
675 Oakwood Avenue
West Hartford, CT
Realgy DOES NOT support changing how the Illinois Power Agency buys power, so that our prices can be more competitive.
We already are:
- Realgy has been below ComEd monthly pricing since January 2012, Twenty-one straight months in a row!
- Our average commercial customer has saved $3,741.41
- Our average residential customer has saved $90.02
We compete in serving our customers, not just with lower priced energy but smarter buying strategies.
This price question is a result of municipal aggregation, where cities like Chicago want to be able to raise money by adding a surcharge onto the electric rate customers pay, and still show savings compared to the utility!
Municipalities select an energy marketer as their preferred vendor and require they add a surcharge to their cost which they pay to the city. The surcharge provides no value to the customer or the energy marketer.
Perhaps instead of looking to raise everyone’s price of power they should just get out of the aggregation business or look to actually add value for their surcharge.
Check out Crain’s article: “Chicago can’t beat ComEd price. So raise it?”
The headline is clear, the timing is a year away…so what to do?
Short-term power planning normally means a 10 year span because power infrastructure (such as pipelines, power plants, distribution lines, etc) have useful lives of 25 years.
So, while the talk about a year-to-year rate hike is not unique, it is certainly unnecessary.
This is the result of Illinois legislators giving ComEd approval for expenditures (which result in rate or cost increases) that the regulators (think of them as the technical advisors) can’t review, modify, or reject. The result is political involvement and rate shock.
Perhaps the 23% rate increase will provide benefit; that is usually how the regulators hold the utility accountable. However, when the politicians approved this increase, guess who will, in turn, hold the utility accountable? That’s right, not a soul.
What to do? Sign up with Realgy Energy Services. Realgy has delivered costs below ComEd for over 5 years. We will continue to provide a fixed price that will reduce this unnecessary rate shock.
Check out Realgy Energy Services ComEd rates for May 2013 and see how much you could be saving www.realgyenergyservices.com Or Call one of our Energy Brokers today 877-300-6747.
Read the whole Crain’s article: “ComEd rates are set to surge”
Governor Quinn is sending a political message that should not pass through more thoughtful consideration of legislators. ComEd has already received approval from the legislators to bypass the ICC in their review and approval of their rates. ComEd has politicized the rate setting process instead of relying on the experienced technical and financial input of regulators.
While they may be successful in the short term, eventually the regulators will have to review their rates and then the balance will likely be restored. Allowing politicians to approve utility plans is not good policy and is even worse for rate payers.
Check out the Crain’s article: “Quinn vetoes ComEd rate hike bill”