Duquesne Light affiliate Duquesne Enterprises and North AmericanPower Brokers are giving Pittsburgh’s retail energy customers a newway to reach up to 50 alternative energy suppliers. With the clickof a mouse button, industrial, commercial and residential customersnow can consummate gas and power transactions. The Internet-basedsystem, called the World Wide Retail Energy Exchange (REX), workssomething like a dating service for the two sides of energyindustry transactions. It also can provide a sponsoring LDC withvaluable back-office information and an advertising opportunity.

North American Power Brokers, a privately-owned firm (DuquesneEnterprises owns a minority share) based in Maynard, MA, launchedthe system last January. It was one of the first systems of itskind to allow retail customers to anonymously complete energy dealsover the Internet. Another electronic retail energy system, calledEnergy Marketplace, which was launched on the West Coast by threeCalifornia utilities in November 1997, is similar. Both operate ason-line, request-for-proposals systems for customers.

So far 50 suppliers, including many of the large volumemarketers such as Duke Energy and PG&E Energy, areparticipating in the REX system. Since going live, the system hasfacilitated nearly a thousand transactions for the purchase ofnatural gas on 28 utility franchises in the Northeast andMid-Atlantic regions and recently completed the country’s firstelectronic retail electricity transaction.

Most of the transactions have been with customers in New Yorkand New England, but usage is spreading fast, according to NorthAmerican Power Brokers President John Gaus. He said the company isdiscussing licensing with 30 utilities and expects a ten-foldincrease in transactions this year. “We’re being descended uponwith interest and business right now. It’s a really exciting timefor our company,” said Gaus. “Utilities, customers and energysuppliers are in a vortex around us right now. It’s a greatsolution for all of the parties.”

DQE CEO David D. Marshall said, “North American’s Internetauction service ensures customers that their energy orders areconsidered by the largest possible group of suppliers, in realtime, resulting in lower prices than would be available using moretraditional energy procurement approaches. Offering NorthAmerican’s energy auction services to Pennsylvania retail customerswill serve to stimulate competition in the Commonwealth and lowerenergy prices for consumers.”

Gaus said a recent study by an independent consultant revealedthat 600 New York gas customers using the system saved 19% on theirgas bills compared to their previous regulated gas service andsaved 12% compared to previous third-party supplier transactions.

“In today’s deregulated environment, customers are bombardedwith often confusing solicitations from numerous energy marketers,many of which they know little about. Using [this] service allowscustomers to avoid the time-consuming exercise of evaluatingcompeting solicitations, while ensuring they are still getting thebest possible price for their energy.”

It also eliminates many of the information tracking problemsLDCs have encountered during the transition to retail competition.”There are a lot of utilities in the Northeast with this new burdenof tracking which customers are buying energy from which suppliersand under which terms and conditions. Utility information systemswere never intended to address the scenario of somebody other thanthe utility selling energy to their customers. This transactionplatform helps the utility manage all of those issues,” said Gaus.

Duquesne is offering its commercial and industrial customers inPennsylvania and groups of residential customers that may beaggregated by local government agencies or others the opportunityto procure gas and electricity through the low-bid Internetauctions.

“Electronic and Internet commerce is facilitating thetransformation of the U.S. economy from one which issupplier-driven to one that is customer-driven,” said DuquesneEnterprises President Thomas A. Hurkmans.

©Copyright 1998 Intelligence Press Inc. All rights reserved. Thepreceding news report may not be republished or redistributed, inwhole or in part, in any form, without prior written consent ofIntelligence Press, Inc.