Power companies dangle free nights and weekends

[defacto7]

Source: AP

NEW YORK (AP) -- Electric bills have long been take-it-or-leave-it affairs: Pay one rate for all the power you used the month before, no matter when you used it.

But some electric companies want to shake-up that rigid business model. They are increasingly offering plans that sound like come-ons from mobile phone companies: Free nights, free weekends and pre-paid plans.

"We are seeing a transformation in the way people buy and use electricity in the U.S.," says Steven Murray, president of Direct Energy's residential energy programs.

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Customers can end up paying a lot more for power than they expected. Some plans offer low introductory rates that can quickly skyrocket. Others have high early-termination fees. Some fixed-rate plans are a great deal if power prices rise, but they may seem awfully expensive if prices fall.

Read more: http://hosted.ap.org/dynamic/stories/U/US_ELECTRICITY_SHAKE_UP?SITE=TXBEA&SECTION=HOME&TEMPLATE=DEFAULT

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I can't help but see more scams on the way.

[NYC_SKP]

1. Most don't understand how the electrical grid works. This is kind of a good idea.

It's not about scams, it's about shifting demand so that we can use cheaper and cleaner forms of generation.

[defacto7]

3. I would hope you are right.

Question is... do I trust the power companies to use cheaper and cleaner forms of generation just because they shook up their business model? From what I've seen just in the Northwest between Bonneville Power and the wind generation industry... I think not.

[NYC_SKP]

5. In California it is most definitely in the interest of the utility to use cheaper and cleaner.

And, in time, other states should be following suit.

After all, why would a utility want to have to pay someone else for natural gas to make your electricity when they can make it out of wind?

[defacto7]

7. In the case of Bonneville,

They were refusing to take low cost wind power because it would lower the cost of their higher priced product which is mostly hydroelectric. It's all about the money not lower cost, cleaner, more environmentally safe power. The wind industry there had a large supply of power, there was a huge lack of supply on Bonneville's end but that kept the price high and they refused to take the wind supply even if it was free. On top of that, if they kept the price up they could have made a huge profit but they just wanted wind out of business.

To be fair, this was about 2 years ago and I don't know what the final outcome was, I'll have to look it up. But I know it was going to put the wind industry in the NW out of business at that time.

Again, I would hope you are right and there is some reason to trust the power companies but that is just not the way America works these days unfortunately. Thanks for the reply.

[NYC_SKP]

8. California is practically unique, with it's ISO and rate decoupling.

Visit CAISO.COM

About decoupling:

[div class="excerpt"

]Decoupling
Decoupling refers to policies designed to “decouple” utility profits from total electric or gas sales so utilities do not have an incentive to try to sell more energy. Decoupling modifies traditional ratemaking practices to adjust rates frequently to ensure that utility revenue is neither more nor less than what is needed to cover costs and a fair return.




http://www.ase.org/resources/utility-rate-decoupling

[msongs]

2. it's called monopoly power providers screwing users with government blessing nt

[tofuandbeer]

4. Yikes!

[cynatnite]

6. I'd need to know a lot more about it. n/t