Puget Sound Energy asks to extend time-of-day pricing pilot

By the OGJ Online Staff

HOUSTON, Sept. 5, 2001 – On the strength of consumer participation in a pilot program, Puget Sound Energy said it asked Washington state regulators to extend until May 2002 a program that allows customers to pay less for power used during off-peak times of day.

A 5-month pricing trial of the utility’s groundbreaking program is currently set to end Sept. 30. The Bellevue, Wash., unit of Puget Energy Inc. also asked the Washington Utilities and Transportation Commission to add about 40,000 business customers to the group of 300,000 residential customers now paying time-of-day rates.

The businesses have been receiving peak-versus-off-peak usage reports from PSE since last December, said Puget Sound Energy. Since May, about 300,000 PSE customers have been paying variable, time-of-day rates for electricity. The customers pay about 30% less during low-demand, off-peak hours than at high-demand times of day.

The Washington utility said electricity use data from June and July indicated customers are taking advantage of variable, time-sensitive rates. Customers paying time-of-day rates shifted about 5% of their electricity usage, on average, from the morning and early evening hours when public demand for power and wholesale power prices are highest.

In addition, customers paying time-of-day rates reduced their overall electricity usage in June by more than 6%, compared to their June 2001 usage.

In a July survey of 821 customers paying time-of-day rates, 89% said the program has spurred them to shift some of their power use to off-peak hours, the utility said. Forty-nine percent said they have cut their overall energy consumption. Nine in 10 said they would recommend the time-of-day pricing program to a friend.

“Our customers overwhelmingly appear to want the information and the price incentive to use energy more efficiently,” said PSE Vice-Pres. Penny Gullekson. She said extending the trial for a full 12 months will allow the utility and state regulators to evaluate customer response to the program through a winter season, when overall demand for power – and the benefits of shifting consumption to off-peak hours – are greatest.

Gullekson said studies indicate that even a modest drop in peak demand power use can produce a dramatic reduction in wholesale power prices.

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