Renewable energy supplier says regulatory barriers are too high
WAYNE, Pa., Jan. 17, 2003 — Green Mountain Energy Co. says it will discontinue serving all of its 1,312 customers in Connecticut as of March 31, 2003.
The company cited regulations that make it cost prohibitive to bring pollution-free energy into Connecticut, as well as the overall lack of a competitive electric market in the state, for its decision to cease operations. The company says it will focus its efforts in the eastern U.S. on expanding its customer base in New Jersey, New York and Pennsylvania
In recent months Green Mountain Energy Company had been the only energy supplier actively signing up residential customers in Connecticut. Green Mountain Energy Company began marketing its brand of pollution-free electricity to Connecticut electric customers in January 2001.
“Green Mountain Energy Company is all about changing the way power is made by offering cleaner electricity from less-polluting energy sources. Unfortunately, regulatory hurdles in Connecticut have made it impossible to continue offering our customers pollution-free electricity service in an affordable manner,” said A. Clifton Payne, Jr. eastern region president for Green Mountain Energy Company.
“This decision didn’t come easily or quickly. We’ve spent countless days over the last year meeting with state legislators and regulators to make the case for electric competition in Connecticut.”
Specifically, three factors led to the company’s decision to discontinue its service in Connecticut:
— The artificially low, fixed Standard Offer rate does not reflect the true cost of electricity.
— New rules adopted in the last year by the regional power grid serving the New England states place limitations and excessive costs on Green Mountain Energy Company’s ability to secure pollution-free wind electricity for Connecticut customers. With no wind power generation available in Connecticut, Green Mountain Energy Company imported renewable energy from upstate New York.
— In a recent report to the state legislature, the Connecticut Department of Public Utility Control (DPUC) and the Office of Consumer Counsel (OCC) concluded that “The competitive retail market has not developed.”
“Without true customer choice, renewable energy offerings and rate savings on the retail market are not viable at this time in Connecticut, as demonstrated by the fact that other energy suppliers have stopped serving customers in the state,” Payne added.
Beginning as soon as next week, the Company will send letters to its customers detailing the reasons for its decision and information about being returned to the incumbent utility companies, Connecticut Light & Power and United Illuminating. The Company expects that the process will be complete within approximately two months. Payne emphasized the Company’s commitment to ensure that these Green Mountain Energy customers will experience uninterrupted service while the return to utility service occurs.
“We want our customers in Connecticut to know how much we appreciate them, and we want to thank them for helping to change the way power is made,” Payne said. “Because of their support, we were able to build the largest solar electric power plant in the state, at the time, at the Discovery Museum in Bridgeport, and our customers have helped avoid about 500 tons of carbon dioxide pollution over the last two years — avoiding as much carbon dioxide pollution as not driving over 1 million miles.
Payne said the Company intends to maintain its electric supplier license in Connecticut. Additionally, Green Mountain Energy Company will continue to strongly advocate for a competitive energy market at the state legislature and the DPUC, he said.
“We sincerely hope someday to once again offer our cleaner and renewable electricity service to Connecticut consumers,” Payne said.
The Company believes that viable models for Connecticut’s energy market can be found in several other Eastern states, such as New Jersey, New York, and Pennsylvania, which are implementing innovative approaches to stimulating competition and spurring demand for cleaner electricity. In New Jersey, a retail “green power” pilot program for 150,000 residential customers will go out for bid in February. Customers in the Niagara Mohawk utility service territory of upstate New York can choose among three renewable energy providers without switching from their local utility company. And in Philadelphia, more than 400,000 residential customers and 60,000 commercial customers are expected to benefit from lower rates and renewable energy offerings under a proposed competitive bid process this year.
Payne also pointed to progressive regulatory conditions promoting customer choice in Texas, Ohio and Oregon where the Company has had success.
“For more than five years, Green Mountain Energy Company has been active in developing competitive markets across the U.S. We are currently operating in seven other states, with plans to continue expanding. Our experience and the many emerging opportunities we have for growing our business mean, simply, we do not need to stay in states that do not support a competitive energy market,” he said.
About Green Mountain Energy Company
Green Mountain Energy Company (www.greenmountain.com ) provides electricity service generated from sources including wind, solar, water, geothermal, biomass, and natural gas. More than half a million customers in California, Connecticut, New Jersey, New York, Ohio, Oregon, Pennsylvania, and Texas have chosen Green Mountain Energy® electricity — electricity that is dramatically cleaner than typical system power in those states. The Austin, Texas-based company was founded five years ago.