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Liberty Power:Liberty Power Names Texas and New York as the Best Retail Power Markets for Small and Mid–Sized Business Customers
FORT LAUDERDALE, FL – February 12, 2007 –
Liberty Power, the nation´s fastest growing independent energy retailer focused on business consumers, today announced that Texas and New York have created the most successful competitive retail electric markets for small and mid–sized business (SMB) consumers in the 21 states that have restructured their electric systems. Texas and New York received the highest marks of “A–” in Liberty Power´s first Electric Choice Report Card for Small and Mid–Sized Businesses.
Liberty Power created the Electric Choice Report Card for Small and Mid–Sized Businesses to provide them with a benchmark on how well their state is performing in helping SMBs benefit from electric choice.
Electricity costs were cited as one of small business owners´ top concerns in a survey by the National Federation of Independent Business, right after the cost of health care benefits and recruiting qualified employees. Energy costs often amount to the equivalent of 50 percent of what small and mid–sized businesses pay in rent.
Retail electric choice allows small businesses to find unique products and pricing plans to help them manage energy costs more effectively. Choice makes small businesses more competitive by letting them pick energy plans that are more flexible and best suit theirindividual needs and demands. Competition frees small businesses from being a “captive customer” of a monopoly utility.
“Texas and New York have led the nation in creating rules that foster an environment where small and medium businesses get robust choices and can shop for power freely and easily,” said David Hernandez, CEO of Liberty Power. “Other states can learn from their leadership and should consider adopting similar policies to make energy shopping a simple process for busy business owners while encouraging more suppliers to offer a diverse range of products.”
Liberty Power´s Report Card graded the 20 states that have opened their electric markets to competition and the District of Columbia on four key criteria to determine whether small and mid–sized businesses are getting the best deal for their energy dollars:
Ability to Compare Prices: Do businesses receive a simple, accurate price structure to easily evaluate their options? Many states have adopted rules to structure utility supply at market prices, which allows businesses to make an “apples–to–apples” comparison when evaluating competitive offers. Other states allow utilities to use rate–based, depreciated generation to set power prices, artificially lowering the cost to produce that power as ratepayers have taken on the risk of building and running the plant. That makes it difficult for businesses to determine the true cost of electricity. How often do businesses get an updated price?
Restrictions on Shopping: Are businesses only allowed to shop during set times during the year (shopping windows)? Do states force businesses to take utility supply for a set amount of time if they decide to return to the utility (minimum stay)?
Protection from Cost Overruns: Are businesses forced to pay for unwise utility investments and cost overruns in utility–owned (rate–based) generation? Or do states remove that risk by not allowing utilities to own power plants?
Regulatory Climate: Are political pressures endangering businesses´ ability to choose the best electric supplier for them?
Texas and New York earned the highest marks on the Report Card for providing businesses accurate prices to compare and ending utility owned generation — making shopping easier for business owners. Their stable regulatory climates have encouraged more than 50 competitive retailers to enter each state, maximizing the choices for businesses. It´s not surprising that both states are among the leaders in switching with 85 percent of business demand in Texas being supplied by a competitive retailer and 60 percent of New York business demand served by a competitive retailer.
Many states received above average marks by moving towards “apples–to–apples” price comparisons that business owners can easily understand when shopping for power — comparisons that truly contrast the utility´s costs to competitive offers in the market. However, many of those states still add complexity to the process by blending utility prices over many years or not refreshing the price often enough.
The results in states with stifling policies that make shopping confusing and difficult for small and mid– sized businesses speak for themselves. Non–residential power shopping is an anemic 12 percent in Ohio, 7 percent in Michigan, 5 percent in Oregon and 0 percent in Arizona and Virginia — five states which received a grade of “D.”
At the bottom of the Report Card were two states that fail to give businesses equal access to unique and tailored power solutions that their large competitors receive. Nevada puts small businesses at a competitive disadvantage by allowing only businesses that use more than one megawatt (MW) to price shop for power. Typical small businesses such as restaurants and dry cleaners use less than 10 percent of that mandate, often below 100 kilowatts (kw). Montana businesses face a similar disadvantage because the state restricts small businesses to shopping only through aggregation pools that might not allow them to buy unique products. Mid–sized businesses in Montana can shop individually but their total participation is capped, which has the potential to create an uneven playing field in the business world.
Liberty Power´s Report Card includes grades and a breakdown of the power market for small businesses for the following states: Arizona, California, Connecticut, Delaware, the District of Columbia, Illinois, Maine, Maryland, Massachusetts, Michigan, Montana, Nevada, New Hampshire, New Jersey, New York, Ohio, Oregon, Pennsylvania, Rhode Island, Texas and Virginia.
Liberty Power´s complete Report Card can be found here.
About Liberty Power
Liberty Power is the fastest growing independent energy retailer focused on business consumers in the United States. Enterprises, entrepreneurs and emerging businesses in high growth markets rely on Liberty for low–cost electricity and the best customer service. Liberty, the only national, minority–owned energy provider, has a singular focus on understanding the specific needs of business consumers and providing the electricity and services they need to succeed. Headquartered in Fort Lauderdale, Florida, Liberty services more than 20,000 business customers and numerous large enterprises in New York, Texas, Maryland and Washington, D.C., including Linens ´n Things, JC Penney, and New York Life.
Liberty Power is a registered trademark of Liberty Power Corp. LLC. Liberty Power Corp. – encompassing Liberty Power Holdings LLC, Liberty Power Maryland LLC, Liberty Power District of Columbia LLC, and LPT LLC dba LPT SP LLC – is certified and licensed by the Public Utilities/Service Commissions of: CA, CT, DC, DE, IL, ME, MD (IR793), MA (CS-057) MI, NJ (ESL-0001), NY, OH, PA, RI, TX (10118) and VA; and is licensed and certified by the Federal Energy Regulatory Commission.< © Copyright 2007 Liberty Power Corporation. All Rights Reserved. Contact Racepoint Group George Snell, 781–487–4608 firstname.lastname@example.org