NGI The Weekly Gas Market Report
Switching games? Or mind games? This past week, a Washington,D.C.-based nonprofit group, United Homeowners Association, called apress conference to charge that nationwide, utilities are playing”switching games” with consumers who attempt to move to alower-cost competitor, or who attempt to use online energycompanies.
The watchdog group based its analysis on natural gasderegulation in two major U.S. markets – Washington, D.C. andAtlanta, GA. Using that information, the UHA charged that the costsavings available under energy deregulation, at least in the D.C.area, actually may be denied to consumers, or take so long that theconsumers finally give up.
Using only one “bad” utility — Washington Gas Light — andone “good” utility — Atlanta Gas & Light — UHA said itfound evidence that WGL customers who want to switch to alternativeenergy companies, including online companies especially, would bestymied in their efforts. One disgruntled former WGL customer wasbrought to the podium to speak of his profoundly unhappy experiencewith WGL, which he said had ignored his requests to changeservices. WGL currently runs a pilot program for its customersbecause deregulation is not fully implemented in the D.C. area.
UHA also disclosed that it had found that at Atlanta’s AGL, lessthan one in 10 customers experienced switching delays for customerswho requested another service. AGL is fully deregulated.
“Natural gas is the same product everywhere it is sold in theU.S., and yet consumers face wildly different approaches toderegulation,” UHA President Jordan Clark charged. “Washington,D.C. is a textbook example of how to make a complete mockery ofenergy deregulation.” Clark said that UHA was aware of “many dozensof consumers” who had been frustrated by efforts to switch servicein the D.C. area, while in Atlanta, “consumers almost never haveproblems switching, and, as a result, actually get a chance to saveunder energy deregulation.”
UHA apparently is unfamiliar with the multiple slamming cases inGeorgia, three of which resulted in settlements with the GeorgiaPublic Service Commission. The last slamming settlement took placeonly two weeks ago, resulting in retail marketer Energy Americahaving to pay $100,000, including $75,000 to an energy assistancefund for elderly and low income customers and $25,000 to the statetreasury.
Clark noted that gas deregulation is under way in 32 states,seven are the first phase of the process, and 12 states havederegulation pilot programs. Another 10 states are “actively”considering deregulation.
“The message here is something needs to be understood bylawmakers and homeowners across the nation,” Clark said. “So-called’pilot programs’ that leave ex-monopoly utilities in charge of theday-to-day side of implementing deregulation are a train wreckwaiting to happen. You can’t leave the fox guarding the chickencoop and expect anything but the predictable result.”
Ironically, UHA’s press and media relations are handled by TheHastings Group, a Virginia-based company that also works forPowerTrust.com, an energy marketer that offers natural gas, propaneand heating oil through its D.C.-based online company. Soon, italso is expected to offer electricity to customers in the same areathat WGL now serves.
A conflict of interests? Not according to Hastings Group SeniorPartner Scott Stapf, who told NGI that he did not see “how thoserelationships will pose conflicts of interest…and I don’t see usdisclosing every other organization with whom we work every time wesend out a press release.” However, The Hastings Group is actuallylisted on PowerTrust.com’s web site as the place to go for moreinformation about the company.
WGL officials felt a little differently about The HastingsGroup’s involvement with UHA. WGL corporate spokesman Tim Sargeantsaid the company’s pilot program is now serving about 165,000customers in D.C., Maryland and Virginia with few problems.
“This program comes under a lot of scrutiny by the commissions,and we want input and they want input,” Sargeant said. “We’ve neverheard from this group (UHA), and we weren’t even invited to offerour comments.” Sargeant said WGL did not even know about the UHApress conference until reporters began calling when it was over.
Sargeant said WGL’s program is “going well,” with few complaintsfrom customers. The “Customer Choice” program has about 30 activeenergy suppliers now. PowerTrust.com currently is not one of them.To prevent “slamming,” the practice of unauthorized switching bysuppliers, WGL requires an accurate customer account number beincluded on the authorized release submitted by the customer beforeenrolling in another program, or once in the program, to change toanother supplier.
WGL said through a written statement Friday that it is an “avidproponent of full-scale natural gas energy competition so that allconsumers may take advantage of the potential economicopportunities and choices that a competitive market provides.”
No changes are planned in the natural gas program because, saidSargeant, no changes have been requested by the overseeingregulatory agencies.
“Washington Gas takes issue with allegations made against itrecently by UHA, a group claiming to address critical homeowners’issues,” said the WGL statement. “Washington Gas has been involvedfor years working side-by-side with regulators, consumer advocatesand other interested parties, in the collaborative process ofaddressing such issues as consumer protection and greater marketaccess in the deregulation process.”
Overall, WGL serves about 850,000 residential, commercial andindustrial customers throughout metro D.C. and the surroundingregion.
Carolyn Davis, Houston
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