WGES Testimony in Support of Customer Education on Customer Choice, March 2010

Washington Gas Energy Services, Inc. (WGES) submits these comments in support of Public Service Commission – Customer Education on Customer Choice.

Washington Gas Energy Services, Inc. is one of the largest competitive providers of electricity and natural gas in the Mid-Atlantic region, including Maryland, and supplies over 280,000 residential and commercial customers in Maryland, Virginia, Delaware, the District of Columbia and Pennsylvania.

WGES supports the goal of educating Maryland consumers about electricity choice encompassed in this bill. A key barrier to customers saving money on their electric bills today is their lack of awareness about their right to shop. According to a recent poll of Maryland voters, more than half of Maryland's residential consumers are not aware that they can shop for their electricity supply, or of how to go about comparing offers from retail suppliers. An overwhelming 88% of Maryland voters believe the PSC should do more to give consumers information about the electricity choices available to them.

WGES has served residential electricity customers in Maryland for a number of years and over that time has solicited hundreds of thousands of potential customers, sent millions of pieces of direct mail, and engaged in a variety of methods to make customers aware of our offers. Based on our experience, however, it is clear that the efforts of suppliers alone are not adequate to educate customers across the state about the state's policy to provide customers the opportunity to choose their electricity supplier. Consumers need an independent source of information about their ability to shop, and state agencies and utility companies need to play important roles in that education.

The bill requires the Maryland Public Service Commission and the Maryland electric utilities to undertake several activities aimed at educating Maryland consumers about customer choice.

PSC Requirements

Implement a Maryland Choice Website: There are many examples of excellent PSC customer choice websites that can serve as the basis for a Maryland PSC site, most notably, the Pennsylvania PUC's PowerSwitch customer choice website, accessible at www.papowerswitch.com. The bill requires the PSC to provide customers not only with supplier contact information and links to supplier websites, but also with information including:

• What is customer choice
• How to shop
• What kinds of options are available (contract terms, variable vs. fixed pricing, termination fees, etc.)
• Options for renewable power
• Frequently asked questions
• Questions customers should ask suppliers
• Disclosures suppliers are required to make to customers
• A ZIP-code searchable database of current supplier offers

To reduce the administrative burden and costs associated with keeping supplier information up to date, the bill also requires the commission website to include a secure portal that allows suppliers to update their offers on the site.

Promote the Maryland Choice Website: In addition to developing and maintaining a website, the PSC should also promote the site. The bill requires the PSC to work with local media outlets to develop and air public service announcements to tell people about choice and direct them to the PSC Choice website for more information.

The bill provides the PSC with cost recovery through their normal assessment process. Electric utility companies and retail electricity suppliers will be assessed for the costs associated with developing and publicizing the website.

Utility Requirements

The bill directs the utilities to provide, at least annually, bill inserts on customer choice. The utilities are also required to supplement their existing customer education campaigns on energy efficiency and conservation with information about electricity choice. Both methods are aimed at minimizing costs. Should the PSC decide that the utilities should do even more to educate consumers, the bill provides for cost recovery for any cost incurred through normal ratemaking methods with charges to all customers.

WGES believes the customer education program envisioned in this bill would be very helpful to educating Maryland consumers about their ability to shop for electricity supply and to bringing the savings that are currently available in the competitive market to more Maryland consumers.

We thank you for the opportunity to share our perspective on this bill and we urge the Committee to give the bill a favorable report.