FirstEnergy Auction Results

January 28, 2011 By

Earlier this week, the second of six wholesale auctions was held to determine FirstEnergy’s default generation rates for the period from June 1, 2011 to May 31, 2014.  The PUCO approved the results of the auction at its meeting on Thursday.  The auction resulted in the following prices:

  • 5.613 cents per kilowatt hour (kWh) for the period from June 1, 2011 to May 31, 2012
  • 5.410 cents per kWh for the period from June 1, 2011 to May 31, 2013
  • 5.658 cents per kWh for the period from June 1, 2011 to May 31, 2014

These prices are averaged with the results of a similar auction that was held last October to determine the prices for the year beginning on June 1, 2011.  The resulting weighted average price from both auctions is 5.56 cents per kWh for the 12 months beginning on June 1, 2011.

This average wholesale price will be converted by the utilities to retail rates that will vary by rate schedule and season.  Note also that FirstEnergy’s current default charges cover both generation and transmission services.  Starting in June, the default charges will be for generation only.  The transmission charges will be passed through to the customer.  Thus, these auction results and any price quotes from alternative suppliers cannot be compared directly to current rates.

To learn more about the auction process, see John Funk’s recent articles in the Plain Dealer: Electricity auction and FirstEnergy customers to pay less for power

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Filed Under: Electricity Auctions, FirstEnergy, John Funk, PUCO, Wholesale Auctions

Clean Energy Push

January 28, 2011 By

Thursday’s Plain Dealer had two interesting articles related to the push for clean energy.

  • Jonathan Fahey of the Associated Press provided an insightful analysis of President Obama’s statement that he wants 80 percent of our electricity to come from clean energy sources by 2035, Obama goal for clean energy.  We agree that we need to be open to using a mix all viable energy sources.  However, any plan to force the use of particular sources will lead to higher costs for electricity.
  • John Funk had an interesting article about the difficulty that FirstEnergy is having with meeting Ohio’s solar power mandates, FirstEnergy says it is unable to buy all the solar power credits it needs.  If Ohio continues down this path, utilities will have to pay higher fees for solar credits and those costs will be passed on to consumers.  While the highest electric costs in Ohio are around 14 cents per kilowatt hour, customers are paying between 25 and 47 cents per kilowatt hour in states like Massachusetts and California that have had solar mandates in place for years.
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Filed Under: Clean Energy, FirstEnergy, John Funk

Natural Gas Prices Increase

January 28, 2011 By

The New York Mercantile Exchange (NYMEX) month-end settlement price for January was $4.32 per Mcf, up from $4.216 at the end of December.  Note that this is just the price for the gas; there will also be charges for basis and delivery. For residential customers of Dominion East Ohio, the standard variable price will increase from $5.42 to $5.52 on February 14th.  We continue to recommend staying with the utility’s variable rates.  For more information, see John Funk’s article in today’s Plain Dealer: Columbia, Dominion prices to rise slightly.

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Filed Under: Columbia Gas, Dominion East Ohio, John Funk, Natural Gas, NYMEX

Cold Weather and the Price of Natural Gas

January 24, 2011 By

John Funk had an interesting article in Sunday’s Plain Dealer about the impact of this winter’s cold weather on natural gas bills: Cold weather driving up cost of natural gas.  As he points out, the best prices for Dominion customers are still the monthly variable rates offered by utility.

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Filed Under: John Funk, Natural Gas