Shedding Some Light on
Virginia Energy Choice
by Jeb Hockman, Contributing
Choice: It’s the American Way
America is the land of choices. We can choose where
we live, what we wear, what kind of car we drive — even at which
fast-food restaurant we eat. In Virginia, many of us will have the
opportunity to choose who supplies electric power to our homes and
With the implementation of Virginia Energy Choice,
the price of electricity supply will no longer be regulated or set by the
State Corporation Commission. The theory behind Virginia Energy Choice is
that suppliers will compete for your business. As an electric cooperative
customer, you can choose to get power from your cooperative or from a
competing supplier, called a Competitive Service Provider or CSP. You do
not have to choose! Staying with your cooperative is a choice.
The 1-2-3 of Getting Power to You
Now, your electric cooperative (1) generates and/or
purchases wholesale power, (2) transmits the power to your area and then
(3) distributes the power to your home, farm or business. This is called
Virginia Energy Choice opens step 1 to competition
and gives consumers the choice of the company who will generate and supply
power. No matter which supplier you choose, your electric cooperative, as
your Local Distribution Company (LDC), will continue to be responsible for
delivering the power to you.
The cost for each step will be separate on your
monthly bill. And, even though the SCC will no longer regulate the cost of
generating electricity, the charges for delivering your power will
continue to be set and controlled by this government agency.
How Many Choices?
You may have two or three choices. You may have none.
Virginia Energy Choice simply gives Competitive Service Providers the
opportunity to compete for your energy-supply business.
Initially chances are that if you live in a more
densely populated suburb, you may have more choices than someone who lives
in a less populated, rural area of the state.
As time goes by and more suppliers enter the market,
there could be more choices than when the program initially begins.
For your protection, all Competitive Service
Providers must first be certified and approved by the SCC and obtain
additional permission from your local electric cooperative.
When we compare prices for gasoline, we check the
price-per-gallon. To compare the cost of electricity, cents per
kilowatt-hour is a typical measure.
A kilowatt is simply 1,000 watts of electricity. Your
energy usage is computed in kilowatt-hours. A kilowatt-hour is a
1,000-watt unit of electricity used for one hour. The cost is shown in
cents per kilowatt- hour (c/kWh). For example, the typical Virginia home
may use around 1,000 kilowatt-hours per month.
Your Price to Compare
Soon, your electric cooperative will provide to you a
“price to compare.” This is the price that a competitor would have to
beat for you to pay less than you now pay for the energy-supply portion.
But be aware that the price to compare isn’t the
only factor to consider when choosing an energy supplier. Before choosing
an electricity supplier, make sure you compare such things as the length
and terms of the contract, types of payment plans, if the price is fixed
or variable, whether there are any additional fees, and are there any
non-monetary costs or benefits.
Another Choice: Share Your Info or Not?
Virginia Energy Choice requires all utilities,
including your local electric cooperative, to provide customer information
to Competitive Service Providers certified by the SCC to sell power in
Virginia. This information would include your name and address and your
history of electricity usage.
You have the choice to share or not share this
information with other service providers. If you do not want your co-op to
release this information, you must contact your co-op and “opt out.”
“Opting out” can be done by marking a box on your
monthly bill, contacting your local cooperative business office by letter,
telephone or, in some cases, completing a form on their Web site.
Be aware that even if you decide not to share this
information, you may still be contacted by a marketer who may have
obtained your name and address by other methods. “Opting out” of the
mass listing does not mean you cannot choose.
Virginia Energy Choice: Learn the Terms
Service Provider (CSP): A person or company licensed by the State
Corporation Commission to offer and sell competitive energy services in
Transition Charge: A fee that can be added to your monthly bill by
your Local Distribution Company (LDC) if you choose a Competitive Service
Provider for your energy. This fee is to cover commitments made by the LDC
when it was required to provide energy-supply service for all of its
The delivery of electricity by a Local Distribution Company directly to a
home, farm or business.
The production of electricity by a power plant fueled by various raw
energy sources (nuclear, coal, oil, natural gas, hydro, etc.).
(kWh): A 1,000 watt unit of electricity used for one hour.
Distribution Company (LDC): The utility that owns, maintains and
operates the distribution lines and equipment to deliver electricity to
customers. (Your electric cooperative will remain your LDC whether or not
you choose a CSP.)
Compare: The average price per kilowatt-hour of electricity now
charged by your local electric cooperative, less any Competitive
Transition Charge, which may be used to compare offers from other energy suppliers.
Corporation Commission (SCC): The Virginia state government entity
that oversees electric utilities and the Virginia Energy Choice program.
The movement of electricity from a generating facility to the Local
Questions? Ask Us.
Change can be scary. Never fear, your electric
cooperative is here to help. And we’re as close as a phone call or a
visit to our local business office.
One of the advantages of being a cooperative member
is that we are right here in your community with friendly people available
to answer your questions and concerns. The more you know about Virginia
Energy Choice, the better the chance you will make the decision that’s
right for you. At your cooperative, our first job is always to answer to
And if you have questions or comments you would like
addressed in future issues of this magazine, contact Cooperative Living magazine by e-mail ([email protected]), or send
questions and comments by mail to Energy Choice Questions, c/o Cooperative
Living, P.O. Box 2340, Glen Allen, VA 23058-2340.
Other sources of information are our Web site (www.odec.com)
or the Virginia Energy Choice Web site (www.yesvachoice.com). You can also
call toll-free: 1-877-YES-2004.
All Energy Suppliers Aren’t the Same
Your electric cooperative is different from most
Cooperatives are operated on a not-for-profit basis
and put the needs of their customer-owners first. Other energy suppliers
are privately-held or investor-owned companies in business to make a
profit for their owners or stockholders.
Since the 1930s, Virginia’s 13 member-owned
electric cooperatives have provided reliable service at the lowest
possible cost. In fact, electric cooperatives were organized to get power
to the thousands of Virginians living in rural areas that the big
utilities considered too sparsely populated to provide energy at a profit.
Today, Virginia’s electric cooperatives serve over 1 million people in
With local management and business offices and a
board of directors elected from the membership, your hometown electric
cooperative is there to keep your lights on 24 hours a day, 365 days a
year, now and for years to come.
Cooperatives return any profits to you, the owner and
Who Do I Call if the Lights Go Out?
You call the same people you have always called —
your hometown electric cooperative.
Even if you choose another provider for your power
and energy supply, your local cooperative will continue to provide the
reliable service you have enjoyed for years. Lightning, ice storms or
whatever Mother Nature may bring, we’ll be here to restore your power
and keep the lights on.
If I Choose a CSP, Will I Still Be a Cooperative Member?
Yes, you remain a member-owner of your local
cooperative whether you purchase your power from the cooperative or from
another service provider. You will be treated the same as always. And best
of all, you will still have a voice in how your local cooperative is
However, your capital-credits allocation will change,
since your patronage with your cooperative will have changed.
Will My Monthly Bill Change?
Your new bill will be different, as Virginia Energy
Choice requires that the amount charged for electricity be shown
separately from the charges for delivering it to your residence or
business. Applicable taxes will also be included, as will information
about your energy use during the past 12 months. So, your new bill will
contain much more information than it has in the past.
Customers who choose a new energy provider may also
see a “competitive transition” charge on their monthly bill. During
the transition period (through July of 2007), state law permits your
present service provider, such as your electric cooperative, to add a
charge to help pay for past investments in power plants.
Do I Have to Choose an Energy Supplier?
No, you have the choice of “choosing not to
If you want to continue having your local cooperative
provide your power, you don’t have to do anything. To protect you from
unscrupulous marketers, Virginia Energy Choice makes it illegal for
Competitive Service Providers to switch or “slam” you without your
When Will Virginia Energy Choice Begin?
It depends on where you live and which electric
cooperative serves you.
Virginia Energy Choice may begin in your area in the
next few months, while in others it may not be available until the program
is fully implemented in January of 2004. Your local cooperative will keep
you informed as to when Virginia Energy Choice will begin in your service
area. No matter who you are served by, Choice will be available no later
than Jan. 1, 2004.
Remember, Virginia Energy Choice does not guarantee
that you will have an opportunity to choose providers. This depends on
whether a Competitive Service Provider decides to offer service in your