Arthur Michael of Middletown is among the first of tens of thousands of Connecticut residents who will soon be rethinking whether to continue receiving their electricity from alternative providers or return to CL&P and UI – the two major electric companies in the state.
With the new reduced rates that the huge companies instituted this year, alternative suppliers will have difficulty this year competing with UI and CL&P.
Michael tipped me off about the issue recently telling me that six month ago he signed up with Energy Plus when its rates were substantially cheaper than CL&P’s.
However, when he recently compared his bill to his mother’s, who receives electricity from CL&P, he discovered he is now paying a higher rate than the standard CL&P offer.
“I noted that on our electric bill for December, Energy Plus’s rate had JUMPED to $0.139871. I checked my Mom’s bill and she was billed $0.1105 per KWH for the same period. I noted that for the entire year of 2011, CL&Ps’ Rate 1 is $0.09482 per KWH, 4.5 cents below the December rate charged by Energy Plus!!!!!!!!!”
“Today I cancelled Energy Plus and requested return to CL&P.”
Paul Frantz, chief marketing officer for Energy Plus, candidly confirmed that his and other smaller suppliers will have difficulty competing with the new standard rates.
“This year utilities are living off their low costs from last year, next year their price will go up,” he said. “Right now our rates are higher than UI or CL&P.”
Energy Plus, with 40,000 (mostly residential) customers in Connecticut, purchases electricity on a daily basis while the two big firms purchase long term contracts that are layered and hedged.
CL&P and UI, Frantz said, can offer lower rates this year because the price of natural gas and the cost of electricity went down last year. But in 2012 the costs will rise dramatically for the major and reduce for his company and other suppliers.
Weather – long stretches of cold or high heat – boost the price of natural gas, the main ingredient that determines the cost of electricity.
Connecticut Attorney General George Jepsen suggests that consumer check state internet sites (listed below) to make sure they are getting the best deal.
“Having a choice of energy suppliers is a good thing if it can help Connecticut customers save on their electricity bill,” said Jepsen in response to CtWatchdog’s request for a comment. “But first customers need to make sure they know what they are purchasing and find the product that best fits their needs,” Jepsen said.
The state Department of Public Utility Control website has information that can help consumers compare offers. You will see 32 separate offerings for competitive energy for CL&P residential rate. Check here.
Some of the offers are fixed for a term (six months, a year, etc.) and some are month- to- month rate plans. Still others are month-to-month variable with a price cap. Overall 18 of the 32 separate offers are for variable priced electricity.
“The important thing for customers is to be educated,” Jepsen said. “Variable-priced offers may over the long term be cheaper for customers, but they can be volatile and the price tends to rise during peakusage months of summer and winter.”
Customers can learn more about electricity pricing and questions to ask suppliers at http://www.ctenergyinfo.com/dpuc_questions_to_ask_supplier.htm.
Franz says his company has a variable rate, that can increase or decrease on a daily basis, even though they try to keep prices steady for at least a month.
He said his company clearly does not guarantee sayings but says it has an excellent reward loyalty point program and “great in-house service.”
“We tell customers to look for long run. In 15 out of 18 months we saved people money.”
Ed Geraldi of Farmington has another electric supplier issue, claiming he was cheated.
He claims that Positive Energy – which is under investigation by state public utility regulators for a whole host of issues, wrote me that he believes he was charged a higher rate than what Positive Energy claimed was its rate.
“I called them and brought this discrepancy to their attention,” he wrote me. “I spoke to Joanna in their customer service department she did some research agreed it was an incorrect rate. I did some research myself and found they charged me a wrong rate for the months of August, Sept. Oct and Nov. besides Dec. They were only willing to send me a refund check for Nov and Dec ’10 in the amount of $10.86. They would not make any additional refunds for any other months.”
Joseph Ventura, ceo of Positive Energy, says he is looking into the matter. Ventura is also being sued by the state attempting to collect a $100,000 fine the state banking department imposed on him for bank fraud.
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