Editorial

Your Utility of Choice
by Richard G. Johnstone Jr., Editor


Richard Johnstone

The air is fresher, the view longer and clearer, and the thinking crisper the morning after. A storm. A community meeting. A date, even.

Or at least it seems to be. And if only the powers-that-be in California knew then what they know now, they might have restructured their state’s electric utility industry differently, if they had done so at all. And as California tries to climb out of its self-imposed mess, other states are watching the West Coast with keen interest, to learn what NOT to do in introducing competition to an industry that has been a regulated monopoly business for over 100 years.

Some 24 states are in the process of restructuring the electric utility industry and introducing choice among electric suppliers to their state’s citizens. Virginia is one of these states, with legislation passed by the General Assembly in 1999 and fine-tuned in 2000 and ’01. In Virginia, choice will be introduced beginning January 1 of next year, and is set to be complete by January 1, ’04.

As you may know, the choice that consumers will have involves only the energy itself — the electricity — and does not involve the delivery of that electricity to your home or business. The utility delivering the electricity to you — in your case, it’s a member-owned electric cooperative — will remain the same. You will be able to choose only the supplier of the electricity itself.

Or will you?

For a consumer to make a choice, there have to be at least two businesses marketing their products or services to that consumer. Making a choice involves having a choice. And at least at the outset, it appears that some Virginia consumers may not have a choice even after competition is introduced beginning next year. In Pennsylvania, for instance, four years into customer “choice,” there are no choices for member-owners of Pennsylvania’s electric cooperatives. That is, no competitive suppliers are willing at this point to market and provide electric energy to these mostly rural consumers, who of course continue to buy their electricity from their electric cooperative.

California — with all its problems — is not Virginia. Out there, demand for electricity rose dramatically in the 1990s while almost no additional electric generating units were being built. And under California’s restructuring law, rates for customers of utilities were capped, while those same utilities were required to sell most of their own generating units and buy electricity on the volatile “spot” market. And with weather extremes mixed in, all of this became a recipe for disaster, one that has captured the attention of the nation as we head into summertime, a season of high usage of electricity.

And Pennsylvania — with its lack of choice for cooperative members — may not be Virginia, either. In the future, there may be electric suppliers courting you, or there may not. On that count, your electric cooperative can make no promises. In the case of competitive suppliers, the decision of whether to seek you as a customer will depend entirely upon whether there’s money to be made in selling electricity to you.

Your cooperative can promise you this, though. Whether or not others are interested in your business, your cooperative always has been. And will continue to be.

And if there are competitive suppliers courting you and you select one of them, your cooperative will continue to deliver that other supplier’s electric energy to your home or business. Or if you “choose not to choose,” your cooperative will continue to provide you with electric energy and deliver it to you, at cost, as we’ve been doing in your community for three generations.

Your cooperative has been your utility of need in the past. We very much want to be your utility of choice in the future.

 

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