Electric choice begins in parts of Virginia this
coming January 1, and is set to be completed in all corners of the
Commonwealth by January 1, 2004. Many
if not most businesses, and perhaps some homeowners as well, will be able
to choose their electricity supplier — the company that provides the
actual electricity that flows into their home or business. The
company that delivers the electricity — the distribution company —
will remain the same, and there
are no laws in place or plans anticipated to change that.
For consumer-owners of electric cooperatives, that’s
good news indeed, because cooperatives, individually and collectively,
have among the best records anywhere for reliable delivery of service. And
that won’t change.
especially for smaller users of electricity, other things may not actually
change either. You see, allowing
electric choice doesn’t necessarily mean that everyone —
especially smaller consumers — will
have a choice of supplier. Confused?
Well you’re not alone. Virginia is one of about
half the states of the union that have adopted laws restructuring the
electric utility industry to allow consumer’s to choose their supplier.
As of today, less than 1 percent of
residential customers and about 1.4 percent of commercial customers have
switched suppliers. Why such low numbers? Well, in part because this
brave new world of electric supply is still in its infancy, and lots of
folks — customers and suppliers — are being cautious. Electricity
is, after all, one of the
absolute necessities of modern life and many are loathe to change
their supplier unless they’ve had problems.
consumers are hesitant to switch given the nightmare going on in
California, where a fatally flawed restructuring law and weather
extremes were introduced into a state where growth in demand had been
outstripping growth in supply for over a decade. A
recipe for disaster? That seems to be the case out West, and avoiding
those problems is exactly why many utilities — including cooperative
power supplier Old Dominion Electric Cooperative — are building or
planning to build new electric generation facilities over the next few
But despite a seemingly adequate and growing supply
of electricity in Virginia, there don’t seem to be any alternative
suppliers interested in selling electricity to residential and small
business consumers. And that’s
not just the case in Virginia, it’s the case in virtually every state
that has introduced competition in power supply.
And it’s absolutely the case for electric
cooperative consumers. At this point,
there are no competitive suppliers anywhere in the country actively
selling electricity to consumers of electric cooperatives. And
that’s why we say that “choice” has quote marks around it, because
it isn’t really choice unless there are two or more suppliers vying for
the business of electric consumers.
And the reason these other suppliers are not
interested in selling electricity to cooperative consumers (at least at
this point) is because there’s no
profit to be made, or at least not enough to justify their marketing
efforts. Which proves the truth of the old saying that “what goes around
comes around”: the same lack of
interest in serving rural and suburban homes and small businesses is
precisely what led folks in over a dozen Virginia communities — and
in over a thousand communities nationwide — to
create electric cooperatives two generations ago, in the 1930s and
’40s. It was and is a case of folks doing for themselves what no one
else would do for them.
As restructuring unfolds over the next two-plus
years, please remember three things.