More Details about how Consumers Pay Higher Bills with Natural Gas Competition. What is Worse: Odds

The Citizens Utility Board offers the service available for consumers at where they provide up-to-date comprehensive natural gas price analysis that is overseen monthly. According to the latest analysis issued on Monday by CUB a great deal of the unregulated natural gas suppliers’ offers are bad deals in comparison with utility rates. They are bad even in comparison with Nicor Gas and Peoples Energy who have set up extremely high prizes. As CUB executive Director David Kolata thinks that switching natural gas supplier you’ll sooner lose than save money on the gas bills. She thinks that while sitting at a real blackjack table you are more likely to win.     
The figures say: of 789 alternative natural gas plans having been marketed since 2003, 291 plans have already expired; 477 – are still in effect. Of the 291 expired plans the consumers lost money on 57% of them, while saved on only 37%. Of those plans in effect, it had cost the consumers 60% more to date.
In 21 cases a gas supplier has defaulted on contracts. Moreover, the majority of suppliers require from their customers to sign a contract for 1-5 years. According to the survey made in December 2004 less than 3% of the offers had saved money. The current analysis demonstrates that more plans have saved money. Probably that happened partly because some consumers had managed to lock in prizes before they increased and reached record levels.
The 2005 federal data state that some 161,000 customers have chosen an alternative gas supplier, and there are 8 firms participating in the programs “customer choice”. The rates offered by them are usually of two kinds: a fixed rate (for a period of one to five years) and a variable rate tied to an index changing monthly. The initial prize of both of them is practically always higher than the utility rates, and to make the offer pay off, the utility rate has to soar.
The Gas Market Monitor compares the rates customers paid on the pricing plans of the alternative gas suppliers with the actual rates offered by Nicor Gas, Peoples Gas, and North Shore Gas. The savings and loss figures are based on typical usage of 1,325 terms a year, allocated by monthly consumption. Offers still in effect were analyzed during February. The data received from the alternative gas suppliers comes monthly and it consists of the per term gas charge, monthly fees and some other charges, but it should be noted that government taxes and surcharges are not included.
Since opening of the gas market in northern Illinois it has become rather tempting for the alternative gas suppliers to use the same name and logo as the regulated utility company has, and some even renege on their fixed offers as their customers save too much.  Needless to say, that the prizes changing so rapidly and often cannot but affect customers, while the companies make fortunes with the help of their staff whose earnings depend on the number of customers they enroll. 

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About Mark Newman

Mark Newman - was born in 1971 in Pictou, a town located on the beautiful Northumberland Shore of Nova Scotia, Canada. In 1998 he graduated from Acadia University (Nova Scotia, Wolfville) with the Master’s degree in social studies. Mark simply adores his wife and sons. Considers poker to be one of the most exquisite kinds of art and rarely misses his chance of practicing.