Friday, May 26, 2006

Electricity buyers of Howard County, Unite!

For too long, our energy needs have been met by a heavily-regulated monopoly. But now, thanks to a deregulated “free” market – if such a thing is even possible in this industry – we will soon have three (three!) electricity providers to choose from.

Aside from the intrinsic “goodness” of choice, the benefits from this new competion probably won't accrue. All of us will face significantly higher rates, regardless of which provider’s juice powers our lives (and, yes, I know our state legislature and Public Service Commission are mostly to blame for the pending dramatic increase, but that’s not the point). What's more, by the time raw energy reaches consumers, after being channeled through numerous conglomerates/producers and markets, we have very little say in the prices, choices or not.

But, through the power of collectivity, we can finally respond in kind to our electricity providers by distorting the market in our favor.

Howard County could be the first county in the state to buy electricity in bulk for residents resulting in lower utility bills.

“I want Howard County to have every tool at its disposal to soften the blow of these steep rate increases on citizens,” said Council Member Kenneth Ulman, D-District 4, who announced the plan to a group of seniors Thursday at the Bain Center in Columbia.

Howard County must petition the Maryland Public Service Commission for a declaration that county residents do not have enough competition from energy companies.

With an approval from the commission, which regulates public utilities, Howard County would be free to create a residential energy cooperative for two to three years.
If you recall, the Columbia Association is also planning to form its own cooperative, but with a larger pool of potential members, the county’s could result in significantly higher savings. What's more, the more people join -- thereby increasing our market status -- the more (theoretically) prices will go down.
A cooperative would boost purchasing power, saving residents between 15 percent and 20 percent on their bills, Ulman said.

The Columbia Association is working to form a cooperative to purchase electricity for residents, which may save about 8 percent, said Phil Marcus, Columbia Association board member.
The county council must first approve a bill authorizing the county to petition the PSC. The bill will be introduced in early June.


Anonymous said...

I think a lot of us feel like fish in a barrel when it comes to the current energy situation, with the "players" in the energy business having free reign to take aim. Enron clobbered California's electricity prices and then self-destructed, clobbering their pensioners, too (again, in part due to pre-Sarbox lax regulation of corporations).

Electric utility deregulation in the name of open markets and competition resulted in deregulation, but hardly healthy competition.

What's next? Privatization of municipal water utilities? Seem farfetched? Think again.

Maybe instead of Howard Countians having to jump through a hoop and collectively bargain to get electric rates that are only 55% higher, we could use an even better state-wide collective bargaining tool - eminent domain.

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