Archive for March, 2012

Can I Really Buy Green Power?

March 19, 2012

I have officially become one of the 1.6 million Pennsylvanians to switch electricity providers. I now have a fixed rate of 7.27 cents per kilowatt-hour—100% green power. This compares favorably to the (RH) rate I was paying PECO, and compares favorably to what the RH rate will be this summer—so I am pretty pleased both on the cheaper price front and the green power front. When I decided to switch, my goals were a) cheap as possible and b) green as possible.

When Pennsylvania lifted the rate caps for electricity at the beginning of January 2011, I did not know a whole lot about the market for electricity. In fact, I barely knew that there was a market for electricity at all. My first task was to decode my electric bill so I knew what I had a choice about. I learned about generation and transmission charges, and the “price to compare”—PTC. Generation and Transmission is what I now have a choice in, and the PTC is the PECO utility benchmark for those generation and transmission charges. For 2011, I decided to watch the PTC to see what would happen before I switched.

I discovered that the PTC is generally lowest in the winter, highest in the summer and in between during the fall. I also learned that the price for electricity is as volatile as the stock market, and in the summertime, the price can shoot up—way up. I began to understand the concepts of variable, fixed, and mixed (blended) pricing for electricity. This was getting more complicated by the season. To top it off, I am (or was) an RH Residential Heating customer. Since I got volume discounts in the winter, no one really wanted me because they would not (or could not) match the RH discount I was getting.

This changed in January 2012 when the RH discount began to be phased out. I started getting real offers in the mail and referred to the state’s power switch website. I had to weed through the fixed, variable, and blended rate offers. “Fixed” could mean 6 months or 12 months—“variable” means the rate changes monthly, and blended means the price for the first 500 KwH is fixed, while any usage above that in any given month is at market rates.

If I happened to be an energy manager for a large enough commercial/industrial user instead of my house, I would absolutely consider doing such a blended contract, because it is certainly possible to “play the market”—if you can watch your usage. For me as a residential customer—I cannot watch my usage closely enough to prevent exposure to (summertime) price spikes. I won’t save enough to make it worth it. But I did know that the PTC was going up April 1, with every indication that it would go up again in July. So I decided to now lock in the best price I could.

I found a good price—Mission 1 (cheaper) accomplished. Accomplishing Mission 2 (green power) ended up costing me an extra $5/month on top of the regular power charges. I should mention that “buying” green power is somewhat of a misnomer. When I plug my light into a wall, the electricity feeding the bulbs comes from wherever PJM is getting it from for my zone. PJM is the entity that actually dispatches electricity from generators to buyers like utilities. On average, the breakdown is approximately 47% coal, 34% nuclear, 15% gas, the rest from various sources like wind and solar. What I am really doing is providing funding via my bill payments for Renewable Energy Credits (RECs) that are paid directly to wind, solar, water and other renewable power providers. This helps support them—so I am indeed supporting the production of “green’ power.

When I asked Energetix (my new supplier) about their green power, they said it was 40% wind and 60% hydro—water over a dam. In addition, I found out that Energetix is based in Rochester, NY and is a subsidiary of Iberdola–the Spanish wind energy company. They also own generation assets in New York State. They partner with an organization called Earth Kind Solar Energy to help with the “green” power they re-sell. Earth Kind’s website had some good case studies of other institutional customers who had used their services (solar)—and those had been re-printed in industry journals. Also, the commentary on some New York blogs checked out for Energetix as well. I forgot to ask who had certified their hydro power—but they seem legit.

So I am pretty happy with what I ended up when I switched. I got a good price for my electricity for the next year, lower than PECO’s PTC. I am also able to support green power development. Maybe I’ll do some research some day to find out which specific dams and wind farms my REC money is actually going to—and take a road trip to go see them. I am always looking for an excuse to go visit Upstate New York—I like it there.

PUC website for switching electricity providers:

Energetix’s green power partner:

Energetix Environmental Disclosure from 2008 (latest I could find):

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