PUBLIC SERVICE ANNOUNCEMENT: Some consumers are seeing higher than usual rates for Gas and Electric primarily those that have switched to a retail supplier and went on a variable rate plan instead of a fixed rate. Here is what is causing the rate increase: While most companys prepare for a cold winter they generally do not plan for 3 polar vortex spread across most of the country. Up here in the mid-Atlantic region our energy is supplied by the PJM grid. Three times this year the grid has run out of power and has had to purchase emergency power from the generation plants. The plants have no cap and charged the grid triple the rate. The grid then in turns charges the suppliers, ALL SUPPLIERS, the higher rates. So what used to cost $6 was being sold for over $250 during peak polar vortex days. Why is it affecting some suppliers more than others? Retail suppliers that are not capital rich bet each month that they can supply their customers with energy at the rates they promised, unfortunately quite a few of these companys lost the bet several times this year. The large companys PECO, PPL, etc they PUC steps in and freezes their rate because they have thousands of customers that would be affected; instead those companys will be allowed to recoup the higher cost they paid through an added Service Fee. Its a commodity business and there is a domino effect going on here that should be reported. Yes, we are consuming more but the suppliers and the grid are being charged more for the generation as well. BTW, companys that charge a cancellation fee, charge one because they dont place bets--they usually purchase all of your electric at one time for the length of the contract so they know they can supply you at the price they promised. Mind you they need to be stable and cash rich to do this, but that is a great indicator of a well-run company. If reporters would report on the whole story instead of just fueling outrage, consumers could make better choices and at least better understand what the heck is going on. I hope this helps. Im sorry I cant offer any solutions for those that have these variable rate plans with companys that hedged (bet), I feel bad reading so many of these horror stories. Thankfully my customers are protected and thankful they are on a low fixed rate. call me if your bill is out of control I can help 267-987-4149
Posted on: Fri, 07 Mar 2014 05:35:48 +0000
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