Delmarva Power erases interest fees in phase-in
Delmarva Power customers in Delaware received two helpings of good news last week regarding the price of electricity. First, Delmarva Power residential customers will no longer have to pay interest on an optional phased-in electricity rate-hike plan. And second, Delmarva Power residential customers now have a choice on where to purchase their electricity.
Washington Gas Energy Services Inc. (WGES) announced on April 21 that it can provide a savings on electricity costs for Delmarva Power residential customers in the state.
“WGES has created one of the most exciting residential electricity programs ever offered,” said Harry Warren, the president of WGES. “Delaware residential electric customers who switch to WGES will pay lower electric rates and help keep the environment clean.”
WGES serves about 200,000 customers across the mid-Atlantic region, according to its Web site at www.wges.com.
According to a press release sent by WGES officials on April 21, switching to WGES would save Delmarva Power customers $85 on electric costs in the coming year. Also according to WGES, 5 percent of its supply comes from wind power, helping reduce the country’s dependency on fossil fuels, the prices of which have caused this year’s spike in electric prices. (Call WGES at 1-888-884-WGES to find out more about the offer and how to register.)
If customers do switch to WGES, they would still receive their bills from Delmarva Power, however, and would call that company if there are problems with the service. That’s because Delmarva Power will still be distributing the electricity. State Sen. George H. Bunting (D — Bethany Beach) said he was happy to hear that Delmarva residential customers would have an option.
“It’s got to be healthy to get some competition in,” said Bunting. “That’s what we’ve been looking for.”
Bunting, though — like many Delaware legislators — was not happy to hear about the electric rate-hike plan Delmarva Power negotiated with Maryland legislators last week. A plan approved by Maryland’s Public Service Commission eliminated an interest fee associated with the phase-in electric hike in that state.
The plan approved in Delaware through House Bill 6 on April 6 included a nearly $35 interest charge because Delmarva Power is borrowing $60 million to cover the cost of the deferral.
“They had given us their word that this was the best they could do,” Bunting said, adding that he only voted for the bill because it would allow NRG — the company that owns the Indian River Power Plant — to sell 10-year supply contracts. “Maybe they weren’t totally up-front with us. It made me so mad. To do one state and not the other, that’s not going to fly.”
Delmarva Power sent a release on April 20, however, saying that they were not trying to dupe Delaware legislators and they were willing to erase the interest fees associated with the phase-in plan offered for residential and small business customers, which they have since done. Matt Likovich, a Delmarva Power spokesman, said that the differences in the state’s negotiations were a timing issue.
“We don’t get any deferral on the payment of interest we’re paying. It was a business decision. (But) the more we thought about it, we thought we could make it work from a business perspective.” Because of the change, a deadline was extended, and Delmarva Power customers can opt out of the phase-in plan until a date yet to be determined. If residents choose to opt out, they will face an average 59 percent electric hike on May 1, rather than paying incrementally until 2009.