Through incentives, programs and credits, utilities are hoping to attract and appeal to new, expanding business clients. Utilities help these companies choose the best site and program to suit their needs. For example, through Xcel Energy’s economic development rate in Colorado, eligible companies, like PepsiCo, can receive an electric rate discount for up to 10 years. “Xcel Energy’s Corporate Economic Development team is proud to partner with our communities to attract key industries for capital investment and job creation,” said Tom Bailey, Senior Director of Corporate Economic Development. “Our shared success depends on collaboration and sharing of data to help businesses complete key market decisions. Our team continues to assist our partners with strategic land and contract service offerings, which help differentiate and elevate our communities.”
However, utility professionals understand the risks involved. If a customer accepts a 10-year contract and the price of other suppliers goes up, they can see the immediate benefits of the agreement. However, if clients enter into a long contract and prices fall, consumers complain. “It’s difficult to time the market and win,” Philip Bartlett, chairman of the Maine Public Utilities Commission, said. “It’s always a risk, no matter what you do,” he said.
Some believe the utility business model needs a complete makeover. Some 4 million US households have had their electricity cut off in recent years and are still unable to afford their utility bill. Janine Jackson said in her weekly radio show called CounterSpin, “The utility business model that we use in this country…that model is broken, and worthy of reconsideration.” Shelby Green, a research fellow at the Energy and Policy Institute, said about utilities, “They’re not really providing the public with an affordable or reliable service. And regulators, public service commissions, are not doing a good enough job requiring utilities to do that.”
Regulators and utilities are looking for successful methods to ease the electricity affordability crisis. Colorado Commissioner Megan Gilman said, “What are we doing to really try to ensure that rate-payers are protected in the long run and (ensure) that those utility investments that end up being repaid by rate-payers are really the best use of that money, and the best option available.”
In such a volatile market, how are utilities adjusting their approach to meet the needs of clients, old, new, commercial and residential.? How is your utility addressing the electricity affordability?