Allegheny Power Supply, Greensburg, PA, the unregulatedaffiliate of Allegheny Energy, an electric utility holding company,has snagged the largest power contract so far in New Jersey’sunbundling market. The power supplier signed to deliver 360 MW overthe next 14 months to 64 industrial users aggregated by theChemical Industry Council (CIC) of New Jersey.

The important point to note, according to CIC’s ExecutiveDirector Hal Bozarth, “is that as New Jersey is beginning itscompetitive market, the largest industrial aggregation went outsidethe state for a supplier.” Bozarth said the chemical and industrialfacilities are mostly located in the territory of Public ServiceElectric & Gas. The Chemical Council pool also was open tomembers of the Coalition for Competitive Energy, which had pushedopening up the marketplace, and the National Paint & CoatingsAssociation.

While the New Jersey market opened Nov. 1, the power shouldstart to flow Nov. 14, which is the first day after a scheduledmeter reading for the industrials. Bozarth credited Epex (EnergyPurchasing Experts) Inc., a consulting group based in FortWashington, PA, with putting together the package and conductingthe bidding.

Bozarth said he expected to have more companies in theaggregation for the next round when the current contract runs out.Participants in the current contract with Allegheny Energy Supplyinclude facilities of General Motors and a Mobil refinery. Thoseparticipating in the pool are expected to save about 21% on theunregulated supply portion of their bill. “The size of thepurchasing aggregation is what helped us get a significantlyreduced price and significant savings.” Bozarth also said thecouncil was considering aggregating purchasing of natural gas.

Sandy Barber, a principal with Epex, said the key to puttingtogether the transaction was limiting it to the membership of thethree organizations. “If you open the floodgates to everybody itbecomes unmanageable.” Epex helped put together the RFP which wentout to 15 companies. Nine responded. The winner was based on price,Bozarth said.

Allegheny Energy Supply has served residential, industrial andcommercial customers in Pennsylvania since that market opened upthe first of this year. Their trading operation operates in marketsacross the eastern half of the country. A spokesman said they havebeen rated the third largest supplier in Pennsylvania’s new market.The parent company, Allegheny Energy Inc., based in Hagerstown, MD,operates regulated electric utility subsidiaries, MonongahelaPower, Potomac Edison, and West Penn Power, and West VirginiaPower, which now do business as Allegheny Power. The subsidiariesprovide electric service to more than 1.4 million customers inparts of Pennsylvania, Maryland and Virginia and West Virginia.

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