Get ready for television ads like this one:
"Public Service Electric, the best place to buy your electric
power. Don't be fooled by competitors' promises of cheap
electricity. We will not be undersold. Shop other electric
companies first. Then bring us your lowest quote and if we can't
beat it, Public Service will give you three weeks of free power for
your air conditioner. Call now."
Think it's bizarre? Well, some experts believe the day is
coming when you will be able to pick an electric company the same
way you pick an airline, supermarket or telephone company.
There won't be multiple wires coming into your house. What will
happen is that variouos electric companies will give you their
pitches and you'll be able to decide which offers the best deal.
The electric companies won't be household names like Sprint,
AT&T and MCI. But the companies could be fighting for your business
just as hard as those telephone companies now are.
Your present electric company will be required to carry another
company's electric power if you choose. Your present electric
company will be paid something for the effort, but the bulk of your
payment will go to the power company you picked.
"In the not-too-distant future, a utility may be required to
allow its transmission facilities to be used for transactions
between any power-generating entity and another utility," says
Christopher Grant, a utility industry analyst with Standard &
"In turn, it would sell the power to the end user," says Grant.
"Of course, the transmitting utility would be compensated for
providing such service."
California is the leader in letting consumers pick their own
power company. The California Public Service Commission submitted a
proposal this spring that would, in stages, allow every electricity
customer in the state to choose a power supplier by the year 2002.
The impetus for this change came from a law - called the
Energy Policy Act - that President George Bush signed in 1992 just
before he left office. The idea was to increase competition and
bring down prices.
People eventually will get the chance to choose their electric
company, says Craig M. Lucas, senior vice president of Oppenheimer
But that time hasn't arrived yet. Right now, whole cities will
have to take over electrical lines before they can change utilities
- an unlikely occurrence.
But utilities already are cutting prices to some industrial
customers. So they are behaving like there already is a competitive
market in at least one part of their business.
Other experts think that companies, not consumers, are likely
to receive the bulk of the benefits from electric utility
competition. There are a number of reasons.
First, big companies will have more clout in making deals with
electric companies. …