Compete Reports

The National Federation of Independent Business-Ohio, in an October 26, 2011 letter, urged the Public Utilities Commission of Ohio to maintain competition in electricity so its members can continue to create jobs, make capital investments and grow their businesses.  Limiting competition in electricity does not make sense for economic development in Ohio, the NFIB-Ohio letter concludes.
 

As the country grapples with how best to stimulate the economy and create jobs, the COMPETE Coalition released a white paper on September 22 by economist Jonathan Lesser demonstrating how competitive electricity markets can spur economic growth and create jobs. Former FERC Commissioner and COMPETE counsel Bill Massey joined Dr. Lesser to discuss the hallmarks of competitive electricity markets and the critical role these markets play in promoting economic growth.
 

Twenty-four major U.S. companies urge governors of Connecticut, Illinois, Maryland, Michigan, Ohio, and Pennsylvania to support competitive electricity markets based on the significant benefits that flow to their constituents.

COMMENTS OF THE COMPETE COALITION

    Pursuant to the Maryland Public Service Commission’s (“Commission”) December 29, 2010 Notice of Comment Period On Request For Proposals for New Generating Facilities (“Notice”), the COMPETE Coalition (“COMPETE”) respectfully submits these comments. 

    COMPETE is composed of more than 530 electricity stakeholders, including customers, suppliers, generators, transmission owners, trade associations, environmental organizations and economic development corporations, all of whom support well-structured competitive electricity markets for the benefit of consumers.   COMPETE members in Maryland such as Big Lots,  Leggett & Platt, PetSmart, Safeway and Wal-Mart operate over 600 facilities, provide 29,600 jobs and spend $61 million annually for electricity.

A Report by the Pennsylvania State University Electricity Markets Initiative
 
In several states that use restructured electricity markets to replace government-controlled price setting with competition, policy makers are seeking to reestablish the government’s role through the creation of state-sanctioned power authorities. This report considers the arguments of power authority advocates from the point of view of the debate in Pennsylvania.
 

While some policy makers and interest groups seek to continue the drawn-out debate over competitive reforms in the electricity industry, consumers are increasingly expressing their preferences through choice, a new study sponsored by the COMPETE Coalition reveals. The volume of electricity sales by competitive non-utility suppliers has doubled since 2003 in the continental United States, and increasingly competitive suppliers are offering innovative products and services allowing competition based on more than just price.
 

The 2010 Annual Report from the Illinois Commerce Commission’s (ICC) Office of Retail Market Development finds customers are now shopping across every commercial and industrial customer electrical market segment, and takes an optimistic view that competition is poised to make great inroads in the residential sector.

Competitive electricity markets are well-structured with effective oversight, and deliver economic and environmental benefits to consumers. These markets have been restructured to promote competition among energy market participants, while maintaining strict regulatory oversight. Competition in these markets fosters innovation, clean energy solutions, green jobs, and affordable energy.

In competitive markets, power suppliers compete against each other to provide the best possible service at the lowest cost in order to attract and retain customers. Comparatively, in monopoly-regulated states, incumbent power providers have no incentive to innovate or lower costs because ratepayers are captive to their monopoly-protected supplier.

Today, more than two-thirds of the nation’s electricity consumers live or do business in states that are part of organized competitive wholesale and retail electricity markets.

THE SOUTH
In March 2010, consumers in the Tennessee Valley Authority’s seven-state service territory started paying between $2.50 and $5.50 more a month due to fuel cost adjustments. This increase is in addition to the 20 percent rate hike ($12 to $15 increase per 1,000 kilowatt-hours per month) that went into effect in October 2008. The rate hike was factored into TVA's 2009 budget, which included $12.6 billion to cover operating expenses and nearly $2.1 billion for new capital investments.

ALABAMA
A typical customer of Alabama Power Company will pay almost $200 a year more, or about $16 per month, for electricity under a rate hike of 14.6 percent, starting October 9th pending approval by the state Public Utility Commission. Electricity costs would also rise about 16 percent for commercial users and an average of 25 percent for industrial customers, if the entire request is approved.

COMPETE recently convened a policy briefing exploring the independent oversight of competitive electricity markets operated by Regional Transmission Operators (RTOs) and Independent System Operators (ISOs). More than two-thirds of the nation’s electricity consumers live or do business in states that are part of these competitive electricity markets.

The briefing featured the external independent monitors who evaluate the performance of these markets and are responsible for market oversight. These independent market monitors provide critical functions in ensuring the competitiveness of wholesale electricity markets, and detail their findings in annual state of the market reports. Their presentations detailing competition, electricity rates, and oversight summarize their event comments and provide insight into market functions.