After marketing natural gas to Georgia customers for a littleless than a year, DukeSolutions, a unit of Duke Energy, has decidedto throw in the towel. The marketer, which only has firm contractswith 16 customers on the Atlanta Gas Light system, filed a petitionwith the Georgia Public Service Commission (GPSC) to cancel its”Certificate of Authority” to provide natural gas marketingservices in Georgia.

“What we are doing in Georgia in just representative of what weare doing all over the country,” said DukeSolutions spokesman RickWirth. “We are, for the most part not taking physical title tonatural gas or electricity anymore.” Instead he said, the companyplans on focusing on other energy services. “There is no state inthe country where we are taking physical title.” Wirth saidDukeSolutions is still a retail services provider, but will now befocusing on demand-side services, information services and themanagement of the procurement of natural gas and electricity.

In its filing, the company points out that its few customerswhose contracts expire at the end of November have been informedthat: DukeSolutions does not plan on renewing their contracts;DukeSolutions has filed with the GPSC for withdrawal of itscertificate and will not be marketing retail natural gas service ona “going-forward basis” in Georgia; and that they should seekalternative service providers within the state.

“Quite frankly, the energy markets did not mature at the pace wehad hoped for,” said Wirth. “So we sort of refocused. We have beendoing this [refocusing] for about the last year.”

If granted approval to exit the market from the GPSC,DukeSolutions would become the latest addition to the growing listof gas marketers that have either filed for bankruptcy, or justpacked up shop in Georgia.

In September, Southeastern States Energy became the third retailmarketer to file for bankruptcy protection since deregulation beganin the state nearly two years ago (see NGI, Sept. 4). The othersinclude Peachtree Natural Gas, which filed for Chapter 11protection in October 1999, and Titan Energy, which filed in July(see NGI, July 10). Southeastern’s parent company, Perry Gas, alsowas forced to file for bankruptcy protection primarily because ofits subsidiary’s financial problems in Georgia. With DukeSolutions’departure, only 11 gas marketers of the original 21 will be left toserve the Georgia deregulated market.

Even with all of the exits Georgia has experienced, somemarketers still see Georgia as a profitable territory. PowerTrust,a Reston, VA-based full service energy marketer has agreed topurchase Perry Gas’ Southeastern States Energy for $4 millionpending the outcome of its ongoing bankruptcy case (see NGI, Sept.18). PowerTrust has already requested entrance as a marketer fromthe GPSC to market gas in the state. The New Power Company, analliance of Enron, American Online and IBM has also requested entryinto Georgia’s deregulated gas market. Both companies said that ifthey were accepted they would plan to market gas to Georgiacustomers over the Internet (see NGI, Nov. 13).

Sean Collins, vice president of industry relations forPowerTrust thinks that the Georgia market is ripe for neworganizations to come in and reinvigorate deregulation. By entering”two new companies into that market, PowerTrust and The New PowerCo. should revitalize the competitive environment,” he said.

Even though the Duke filing expressed a pretty firm marketerexit by DukeSolutions from the troubled Georgia gas market, thecompany included a back door policy. “DukeSolutions expresslyreserves the right to apply at a later time for the issuance of anew Certificate of Authority and asks that its current certificatebe canceled without prejudice,” DukeSolutions said in its filing.

“We still have quite a presence in Georgia, we have salesoffices in Atlanta,” said Wirth. “Georgia is still important to us,it’s just that natural gas and electricity in the physical arenot.” The spokesman said he does not anticipate any difficulty fromthe GPSC in canceling its certificate.

Alex Steis

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