Illinois customers now have four choices for electricity – Chicago Tribune @energy
Illinois opened its residential electricity market to competition in 2002, but it wasn’t until May that Chicago-based BlueStar Energy Solutions LLC announced it would serve residential customers in the state.
After the ICC’s decision last month, two more companies, Champion Energy Services LLC and Spark Energy LP, both based in Houston, announced they would serve the Chicago residential market. Spark will bill through ComEd.
"Up until now, if you wanted to sell energy to a residential customer, you would have to bill them directly, which meant that the customer would either get two bills, or we had to take the ComEd charges and send them one bill that way. That would have been an expensive proposition," said Hal Poel, director of marketing for Spark Energy.
BlueStar bills its residential customers online.
While all three companies’ rates are comparable or better than ComEd’s, only 600 residential customers had switched to alternative suppliers as of August, the most recent data available, according to the ICC. ComEd serves 3.4 million residences.
"The jury is still out on whether residential competition is going to bring real value to consumers," said David Kolata, executive director of the Citizens Utility Board, a consumer advocacy group.
Kolata urged consumers to read the fine print before signing a long-term contract with an alternative supplier. A lower price may not seem so low after adding in early termination fees, monthly maintenance fees and other possible charges, he said.
"That having been said, there is a fair amount of headroom right now between the ComEd price and the market price," Kolata said.
ComEd doesn’t make its money off the electricity it supplies, which is simply passed through to customers at the same rate ComEd pays to obtain the electricity from suppliers. The money ComEd makes comes from the delivery of the electricity, which consumers pay even if they switch suppliers.
Kevin Wright, president of the Illinois Competitive Energy Association, called consolidated billing a "huge boon to promoting retail electric competition and choice to residential and small commercial customers, which has been stalled for years due to market costs and barriers to entry for retail electric suppliers."
Jon Casadont, chief legal officer for BlueStar, said he expects more residential customers to switch to alternative suppliers because consumer awareness should increase in tandem with marketing and promotional efforts.
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