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New York First With Full Local Gas Competition

Fortnightly Magazine - May 15 1996

The New York Public Service Commission (PSC) on March 14 approved utility restructuring plans aimed at opening up the local natural gas markets to competition. Residential, small business, and commercial/industrial gas users now may purchase their gas supplies from a variety of sources, just as larger industrial customers may purchase from sources other than the local utility (Docket No. 96023/93-G-0932).

The plans had been submitted by instate natural gas and combination electric and gas utilities in response to a PSC order establishing a policy framework to: 1) assure fair competition between local utilities and marketers, 2) provide access to supply options for as many customers as possible, 3) ensure quality service at affordable rates for core customers who cannot access new sources, and 4) continue existing consumer protections.

The key to the competitive market is that customers now have the ability to aggregate and shop collectively for lower-priced natural gas. Meanwhile, the utilities will unbundle the components of natural gas service.

"While other states have competitive programs in place, New York becomes the first to implement broad-based restructuring down to the residential level statewide," said PSC chairman John F. O'Mara. "The Commission expects this restructuring to provide consumers more choices and competitive pricing of gas supplies and to promote economic development by retaining businesses in, and attracting them to, the state."

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