ComEd does not disappoint, once again. As if on cue, they are readying to impose yet another rate hike because, ah, it’s been a while. (A few months, maybe?) Note this is ON TOP of the rate hike they are planning in the near future to fund their smart grid project. Because only ComEd could hike their rate hike. See the Crain’s article here. “A significant increase in rates” is in the offing. See that word “significant”? (I bolded it for you even.) Now that’s worth a bit of contemplation.
So, I’m trying to understand the logic here… Illinois deregulates the electricity industry to promote competition and effect lower prices. New suppliers come on to the scene and competition ensues, and rates — for those who switch — decrease. Desired effect is realized. Yay! That’s great, right?? WRONG. Well, it’s great for the people who have switched. But now it appears that those who have stayed with ComEd, out of lack of awareness about switching, indifference, fear of change, etc., are going to pay the price – literally and figuratively. Yep, as a reward for staying true to ComEd, they will be footing ComEd’s bill for the people who are taking advantage of deregulation as it was intended. So, what is wrong with this picture?
Deregulation did its job. Evidently, it didn’t take into account that ComEd made a bad business decision by entering into “higher-priced long-term contracts” for electricity, which requires their customers to pay more for electricity (rate hikes notwithstanding). ComEd seems surprised that individuals, businesses, and now municipalities are kissing ComEd goodbye in droves, switching to alternative electricity suppliers who can offer much lower rates. Shocking that people would leave a business that is overcharging its customers, right? Not sure why ComEd could not have anticipated this. So now, instead of passing the resultant losses down to investors, ComEd has decided to wring the lifeblood out of its remaining customers by tacking charges on to the Purchased Electricity Adjustment, — an already pretty ambiguous charge over which customers have no control. Sure, ComEd’s rates are regulated by the ICC and profit cannot be achieved from the supply portion. But what’s the point in that if they can just slap charges on another “unregulated” portion of the bill. Interesting how they managed to work that in. Just curious… but exactly when does ComEd become accountable for their own losses, instead of passing them along to their captive consumers??
This brings to mind the recent debacle with Netflix and their impromptu 60% rate increase, brought about by their own miscalculations of how many users would still want to receive (and pay for) DVDs in the mail. As a result, Netflix’s market value was halved, and miffed subscribers left the service in droves.
One doesn’t need a crystal ball to prophecize that a similar future is in store for ComEd. As more and more customers realize they are not only paying more to begin with –- on top of receiving marginal service, at best — but are also being penalized as a result of other consumers saving, they’ll hopefully figure out that it’s time to guzzle the kool-aid and vault themselves onto the switching bandwagon right quick — before the first of many rate hikes take effect. (And those rate hikes have babies that then multiply.) That the best place they can be is as far removed from ComEd as possible while still relying on them to deliver the power. Because when it come to comes your electricity, there are only some things you can control, and apparently switching suppliers is one of the few — if not the only one.