Power companies – update

Interesting. Shortly after posting about power companies, I received a comment from Progress Energy correcting me about the plans. It seems [pure speculation here] that Progress has some sort of “blog response” team up in Maryland or northern Virginia. Anyway, I misnamed the program that I had been offered, as the comment says, it was indeed the “Balanced Bill” payment plan where you wind up spending some 11% more over the course of the year for the privilege of knowing that your bill will be 1/12th of a fixed amount. There is (apparently) a different equal payment plan which is comparable to what we had with Duke Power. However, it’s not the money maker that the Balanced Bill program is and so it is not heavily advertised. Unfortunately, I can’t seem to find details of the plan online. The closest I can get is here, which seems to be lacking in specifics.

Interestingly, the News and Observer ran an article this morning about the Balanced Bill plans and how the state might ban them. Not for the surcharge – how you want to waste money is your own business, but as I noted, they create no incentive to save energy. From the article:

“This is the kind of thing that creates a disincentive for saving electricity,” said NC WARN Director Jim Warren. “This is the old utility business model: maximum sales of electricity and talking green to the public.”

The Utilities Commission could rule on the dispute within 30 days. The commission approved the billing programs for both utilities as recently as 2004, but last year the regulators re-opened the case because of the concerns about energy waste. Critics said customers who pay a fixed bill regardless of usage have no incentive to turn out the lights, turn down the thermostat or otherwise conserve, because they pay the same price, regardless.

Those critics appear to be right. According to data from the utilities, customers who enroll in the program show a jump in electricity use that can approach 10 percent over three years.

10% in three years. Considering that the programs aren’t that old (started in 2002 and 2004 for Duke Power and Progress Energy respectively), that’s a huge increase that could potentially sustained for a longer period of time. It’s good for the power companies – after all, if you use more this year, then next year’s bill will reflect that. And if you use well beyond what they’ve budgeted for you, well, they can always cancel your participation in the plan.

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