AUSenergy News Update 12/09/2013
Dec 9, 2013

In today’s AUSenergy News Update: Winter storms across the U.S. have caused natural gas prices to rise, a House bill in Michigan seeks to expand electric choice to consumers with a provision to include opt-out municipal aggregation, and electricity deregulation is blamed for high electric rates in New York State.

Winter Storms Cause Natural Gas Prices to Rise

Summary: A winter storm that has moved across much of the country, knocking out power to hundreds of thousands of people in the process, has caused natural gas futures to rise as much as 1.3% in early trading today. Prices rose over 4% last week and are at their highest levels since late May.
AUS Comment: AUS strongly encourages our clients to consider fixing at least a portion of their natural gas purchases so as to help protect them from the volatility of the natural gas market that naturally occurs, especially during the heating season.

Municipal Aggregation, Purchase of Receivables and Utility Corporate Separation Included in Michigan House Bill.

Summary: The recent Michigan bill that would bring electric choice to Michigan customers also contains provisions that would require electric utilities to purchase receivables from alternative suppliers, bar utilities from owning generation, and allow municipalities to aggregate residential customers on an opt-out basis.
AUS Comment: AUS is excited at the prospect of electricity choice for Michigan consumers, and opt-out municipal aggregation is a key aspect of this. As residents in New Jersey, Illinois, Ohio, and other states have found out, municipal opt-out aggregation offers the greatest potential for electric savings to residential customers, and AUS is looking forward to helping Michigan municipalities help their residents realize such savings.

James Brennan Blames Electricity Deregulation for High Electric Rates in New York State.

Summary: New York Assemblyman James Brennan explains how deregulation of electric markets in New York has led to some of the highest electricity prices in the country, and calls for New York to re-regulate their electricity market.
AUS Comment: Assemblyman Brennan makes some compelling points, but AUS doesn’t believe that the answer lies to re-regulating. Deregulation has followed through on its promise of lower prices in many other states, such as Illinois and Ohio. New York should instead look to emulate the deregulation of those states and correct the issues inherent in their current system, thus allowing New York consumers the greatest opportunity for electricity savings.

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