De-Regulation Still Rolling Forth Increased Costs Create Second-Guessing

With electric de-regulation well underway in New York City, increased focus is shifting toward how well the competitive system is serving customers. The phased-in process, which began in 1998, has gradually allowed customers to get their electricity from alternative energy suppliers, or ESCOs (Energy Service Companies); historically, Consolidated Edison was the sole energy supplier in New York City. In the new de-regulated market, Con Ed still delivers electricity, but customers get to choose whether Con Ed or an ESCO actually supplies their electricity.

The main reason for de-regulation is to encourage lower prices through competition. As the New York State Public Service Commission (PSC), which enacted de-regulation and is overseeing its progress, has stated publicly, it believes de-regulation will stimulate economic growth, lower prices and give consumers more choices.

With de-regulation now in its third phase, many New Yorkers are wondering why their electricity bills have nearly doubled since last year, especially with this summer’s gentle weather, which left many energy-sucking air conditioners idle.

Defining De-Regulation

By November, everyone in New York City should be eligible to have energy supplied from any of about 20 different ESCOs or from Con Ed, says Ed Collins, a PSC spokesman. "It’s been a situation of phasing in the amount of energy available for those who chose to switch."


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