Georgia broke all records in unbundling 95% or 900,000 customersfrom Atlanta Gas Light’s merchant service in just nine months. Nowit’s up to the policy-makers “to justify the amounts of savings,determining if consumers are really better off,” AGL PresidentPaula Rosput told state regulators Tuesday.

“We liken the program to WalMart and assume that the competitionamong multiple suppliers will drive down costs through innovation,”Rosput said in a presentation at the National Association ofRegulatory Commissioners’ (NARUC) summer meetings in San Francisco.Georgia’s accelerated time frame was mandated by state lawrequiring the unbundling to be completed by the time AGL’s ongoingrate case was completed in mid-1998.

Was it too fast? “Absolutely. [There was] too much compressionfrom the time of the law until the time the commission had to issueits orders….just too many things being done, too quickly.Considering the time frame, it is a real credit that things havegone as well as they have,” Rosput responded to questions.

It’s the “eleventh hour” before the Georgia Public UtilityCommission’s Aug. 11 date for customers to choose new suppliers.After that date, the remaining customers will be assigned tomarketers. “In Georgia, we basically created a specter of ‘unlessyou want Big Brother to make a choice for you’, you really ought toget into the market,” Rosput said. “More than 900,000 customers(out of 1.5 million) have moved to marketers in nine months. Noother deregulation initiative comes close to this pace.”

Partly the speed and partly the requirement that marketersaccept expensive upstream pipeline capacity that had been dedicatedto AGL has narrowed the field of marketers to those with enoughcapital to play the game. Six marketers have picked up most of thecustomers so far, with the two leaders, Scana Energy, anunregulated affiliate of South Carolina Electric and Gas, and AGLaffiliate Georgia Natural Gas Services, holding the lion’s share orabout 70% of those who have chosen. Peachtree Natural Gas, ShellEnergy Services, Columbia Energy Services, and United GasManagement of Georgia are the other surviving marketers.

Meanwhile, AGL has experienced what Rosput calls two”challenging quarters” financially since the customer choiceprogram began last fall, wrestling with growth of 2.5% annually andgrowing productivity as its customer base is turned over to themarketers.

“Having deregulated natural gas in Georgia, we obviously embracea deregulation agenda that is done more broadly with a simpler,standardized framework around it,” Rosput said. Similar programs inother states will make it easier for the consumer. Customereducation programs have been extensive, but they never get the fullresources they deserve, Rosput said. For example, in Georgia therewas not enough attention to non-English-speaking customers.

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