(Occasionally, we will provide articles to corporate energy managers that contain information that they should be aware of, but that may not be well covered by the media. The ABACUS study is focused on residential energy markets, but it is an excellent tool for gauging the progress of energy marketing choice in each of the 23 states that are researched. For example, according to this report, Michigan, Virginia, Ohio, Vermont and New Hampshire have performed poorly when it comes to improving energy choice, while NY and Texas have performed well.

Power Management Company serves customers that have franchise locations, food processing facilities and office locations in several states. We consider this a core strength, which is based on our independence. We are not owned or controlled by any utility, and so we can provide unbiased solutions. Nor are we tied to any energy preference. Our objective is to develop the best available energy solution for your business based on the optimal energy profile for your geographic area. - John Burt)

Texas and New York Set the Best Examples.
"Default-Service" Rules Are the Key to Giving Customers the
Benefits of Competitive Market

  BURLINGTON, Mass., May 30 /PRNewswire/ -- The Alliance for Retail

Choice (ARC) today released a study showing that many states continue to

make progress in adopting competitive retail electricity markets. New York

and Texas were the clear leaders among states that have given customers the

ability to choose their electricity supplier.

  "Our economy is built around competitive markets, and we need to bring

the full advantages of that model to electricity customers," said Thomas

Rawls, Director of ARC. "Customers in Texas and New York have a range of

excellent choices. In many other states, customers are still waiting to get

the full benefits that can be delivered by the competitive marketplace."

  According to the report, "The design of 'default service' . . . is the

most significant factor that determines the success of retail choice. A

poorly designed default service undermines retail competition."

  Nat Treadway, Managing Partner, Distributed Energy Financial Group, LLC

the consulting firm that conducted the study on behalf of ARC, added,

"Many factors contribute to the development of a well- designed market,

but nothing is as important as making sure that theregulated rate available

to customers accurately reflects current prices in the electricity markets."

  "Despite the complexity of electricity markets, state regulators

continue diligently to work through the challenging issues of creating

effective retail electricity markets," Rawls added.

  "ARC's Baseline Assessment of Choice in the US" (ABACUS) considers the

market structures, business practices and regulatory policies that support

electricity choice for residential consumers in 28 states and 2 Canadian

provinces. Abacus is designed to assess each state on its progress in

implementing retail competition in electricity markets.

  Retail electricity choice is thriving in Texas and New York because the

electricity market structure in those states has advanced sufficiently for

competitive markets to work effectively. More than 3.7 million residential

customers are being served by competitive suppliers in those two states

alone.

  Ten other states, including Massachusetts, Connecticut, Illinois,

Maryland, and Pennsylvania, have been classified as achieving "medium

progress."

  In Texas, which recently ended its five-year rate transition for

residential consumers, residential consumers can choose from over 50

distinct products -- a wide array of offers including electricity from wind

energy, fixed-price products for multiple years, pricing that guarantees

savings in extreme summer heat, and products that encourage energy

efficiency.

  In New York, 625,000 or 11% of residential consumers are purchasing

their electricity from competitive suppliers, a growth of 55% in one year.

In one utility service area, residential customers have a total of 37

electric rate offerings available from suppliers, green power providers,

and the local utility. Offerings include fixed prices, indexed, blended,

and green power. In aggregate, 41% of the total electricity usage in New

York is currently provided by competitive suppliers.

  While the ABACUS study did not assess retail electricity competition

for large customers, numerous large commercial and industrial consumers

have benefited from the introduction of competition. They have seen price

reductions and the introduction of new products and services that help them

to manage risks, increase reliability and manage energy in the same way

they manage other inputs.

  ARC made its assessment with the assistance of representatives of eight

state regulatory commissions. The ABACUS Advisory Group helped create a

methodology that takes into account 20 components of retail service to

score each state. Among the key components considered were the design of

default service, ease of choice, uniformity of standards, consumer

education, competitive safeguards, and rules governing utilities and their

affiliates.

  To view the complete report, go to:

http://www.allianceforretailchoice.com/ProjectCenter/Default.aspx?tabid=1753

  The Alliance for Retail Choice advocates for continued development of

retail energy markets that provide customers the opportunity to choose the

products and services most consistent with their needs. The Alliance

provides a focused voice for competitive energy retailers and their

customers in selected public policy forums on the federal and state level.

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