A talk with two LDCs. First, PSE&G appears content to cede sales to marketers, Second, NW Natural intends not to give in just yet.
This much is clear: Energy utilities are headed for an unbundled future.
As states from both sides of the country implement residential and commercial natural gas unbundling, require residential choice pilot programs and grapple with electric industry restructuring, competition shows no signs of slowing. To boot, some members of Congress seem eager to give competition a national push.
But while a federal approach appears to have guided the restructuring of interstate natural gas pipelines in a way that has benefitted the gas industry as a whole, some experts doubt that local distribution companies, under state regulatory jurisdiction and subject to state laws and the vagaries of local economic conditions, are appropriate candidates for a "one-size-fits-all" approach.
I interviewed executives of two large, long-established gas utilities, one on the East Coast and one in the Pacific Northwest, asking how they have reacted to the winds of change.
Enlisting the Enemy
New Jersey's largest gas utility, Public Service Electric & Gas Co. of Newark, responded to a call from the state Board of Public Utilities for a residential choice pilot program by opening up four towns in different parts of the state to gas marketers interested in competing with PSE&G to supply gas to homeowners. So far, no one has chosen to enter the market.