AES Corp., a major electric generation and distribution company, continued to shift its focus onto downstream operations by forming a new subsidiary, Power Direct, to compete for electricity and natural gas retail customers in U.S. markets. Power Direct already is licensed to sell electricity in New Jersey and anticipates the receipt of a license in Pennsylvania by the end of August. The company plans to begin marketing in those states in the near future.

Power Direct’s main office will be in Arlington, VA, with an additional office in Peoria, IL. It will employ several dozen people to start, “then grow from there,” said Christine Wood, a Power Direct vice president. Its gas operations will begin once deregulation occurs in those two states. While its focus initially will be the Northeast, Wood said, “if the success rate is high enough, we plan on being a national energy marketer as more states unbundle.”

AES said the new subsidiary’s principal focus will be on the residential and small to mid-sized commercial energy users. Power Direct will complement the business of New Energy, another AES affiliate that sells electricity and energy services to larger commercial and industrial users.

“This creation of this new AES energy mass market business in the United States continues our recently demonstrated strategy to enter the competitive retail energy business,” said Dennis W. Bakke, AES’ CEO. “Our efforts with Power Direct, New Energy and CILCORP should give us valuable insights into the retail energy business…” New Energy was formed when AES bought New Energy Ventures last June (see NGI, June 21). CILCORP, parent of Central Illinois Light Co. was bought by AES last year.

“With Power Direct, AES is entering this very large segment of the U.S. market,” said Tom Tribone, executive vice president of AES. “Power Direct will have an Internet focus as an important part of its strategy to provide consumers with a dramatically better buying experience.”

Based in Arlington, VA, AES is a global power company that currently owns or has an interest in 105 power facilities totaling over 32,000 MW in the United States, Canada, Australia, Argentina, Brazil, Dominican Republic, Panama, Mexico, Pakistan, India, Bangladesh, the Netherlands, Hungary, Kazakhstan, China and the United Kingdom. AES also distributes electricity to nearly 14 million customers throughout the U.S. and is a retail marketer of heat and electricity.

John Norris

©Copyright 1999 Intelligence Press, Inc. All rights reserved.The preceding news report may not be republished or redistributed in wholeor in part without prior written consent of Intelligence Press, Inc.