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RG&E Reaches Customer Choice Settlement

RG&E Reaches Customer Choice Settlement

Rochester Gas and Electric (RG&E), has reached an agreement with the New York Public Service Commission (PSC) staff and other companies and groups to actively promote the customers' right to choose among competing natural gas suppliers.

Each competing supplier of natural gas will receive $45 a year for each customer who switches from RG&E to a qualified gas marketer. In exchange, RG&E would be able to collect the difference between the $45 it pays annually per migrating customer and its actual savings by placing a tariff on the customer. The $45 number was arrived at by a "balancing of interests," the spokesperson for RG&E, Dick Marion, commented.

The agreement allows for a much simpler billing system in which delivery and commodity charges will appear on the same bill. If RG&E delivers the gas on its distribution system, and another marketer sells the actual product, then the customer will only receive a bill from the marketer with both delivery charges and commodity charges on it.

The PSC hopes this agreement will help natural gas marketers to compete for residential and commercial customers, as well as promote gas-choice awareness amongst the public. Its vision is that eventually all natural gas customers will be served by non-utility suppliers. The PSC wants the utilities to still maintain the local distribution lines and respond to gas emergencies.

There are 22 companies that are currently approved to offer gas within RG&E's service region. Of the gas that runs through RG&E's pipelines, 40% is supplied by non-utility marketers. Since residential customers were given choice in 1996, and commercial customers in 1986, 17,000 people have chosen alternative gas suppliers.

The settlement still has to be approved by the entire PSC. If it does receive the go-ahead, then it would go into effect on July 1 of this year, and last until June 30, 2002.

Alexander Steis

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