WASHINGTON & ALBANY, N.Y., May 23, 2005 (BUSINESS WIRE) — “It is extremely difficult to develop and implement Public Policies that benefit consumers, businesses and the local economy simultaneously,” says Craig Goodman, president of the National Energy Marketers Association (NEM). “But, Chairman Flynn and his team at the New York PSC, have set a new standard for utility regulation. Other states cannot afford to miss the obvious benefits of lowering prices, increasing reliability and stimulating economic growth at the same time.” said Goodman, a former high-ranking official in the Reagan and G.H.W. Bush Administrations.
“Despite opposition from giant utility monopolies fighting to maintain market share, Chairman Flynn approved one of the most progressive combinations of public policies in recent memory, Consumers can lock in a guaranteed 7% savings immediately and then shop for any supplier they want or go back to the utility if they are dissatisfied. In turn, utilities are offered performance based rates to increase funding for reliability investments and local small businesses reap the benefits of competing for new opportunities that were formerly controlled by the utility,” said Goodman.
“At our National Restructuring Conference last month, we invited a number of the best and brightest utilities who are turning over the commodity trading business to risk management professionals like NEM members and Wall Street professionals. Central Hudson, Orange and Rockland and National Grid have worked hard on their restructuring plans, and each one of them has concluded that there are significant benefits associated with exiting the merchant function and focusing their resources on infrastructure maintenance and upgrades,” said Goodman.
“Utility regulations were not written to encourage utilities to profit by trading volatile commodities. Instead, utilities have an obligation to risk-adverse elderly and low-income consumers. It simply makes good business sense to shed these functions and permit competitive suppliers to bear the risk,” said Goodman. “In my opinion, the first-movers among the utilities will likely get the best result for their shareholders. Many of them have already doubled or tripled their stock prices,” noted Goodman.
About National Energy Marketers Association
The National Energy Marketers Association (NEM) is a national, non-profit trade association representing wholesale and retail marketers of natural gas, electricity, as well as energy and financial related products, services, information and advanced technologies throughout the United States, Canada and the European Union.