Park Power

Your Friendly, Local Utilities Provider

Archives for August 2015

Choose Light from ENMAX Energy, is a light bulb really worth it?

· · Leave a Comment Consumer Info, Electricity, Interesting, Uncategorized

ENMAX is currently trying to win over consumers with its Choose Light campaign that rewards consumers with higher rates on electricity and natural gas…and some light bulbs.

You may have seen their advertisements on billboards around town and with large print advertisements (translation – large advertisements = large overhead) hoping to wow you into signing up for a 3 year Fixed Electricity and Natural Gas agreement.  All with asterisks informing you that you will be charged a $228.38 cost recovery fee per device for early cancellations of the agreement. So, if need or want to cancel for a reason you are forced to buy their fancy light bulbs.

With ENMAX is really trying to lock consumers into their services with some fancy light bulbs, I thought I would give consumers a breakdown of whether those fancy light bulbs are worth it.

So when a consumer signs up for a Choose Light plan what are they really getting themselves into?  Here is a breakdown.

A customer must sign up for a 3 year agreement for both electricity and natural gas with electricity at a fixed rate of 6.79¢/kWh and natural gas at a fixed rate of $4.99/GJ with administration fees of $7.10 per site per month.  For demonstration purposes we will say and average residential consumer uses 1000 kWh of electricity and 10 GJ of natural gas per month (which is very close to the Alberta averages).

1000 kWh x $0.0679 = $67.90

$7.10 admin fee

Monthly Enmax electricity usage charges  of $75.00

10 GJ x $4.99 = $49.90

$7.10 admin fee

Monthly Enmax natural gas usage charges of $57.00

Combined total Enmax electricity and natural gas usage charges over a 3 year term $1584.00.

Comparitively Park Power is a smaller enterprise than ENMAX  and we compete by running our business with efficiency in mind.  We maintain a low overhead and use efficient business practices and processes.  Instead of rewarding our customers with some fancy lightbulbs, we offer them lower rates, superior customer service, ease of use, and the good feeling that our profits are shared with awesome local charities.

What could the same 3 years cost a customer who signed up with us?  Keep in mind we would not encourage choosing a Fixed rate for natural gas since supply is high and market prices have been and should continue to remain low.  The average Floating rate for gas is around $3.50/GJ (30% cheaper than the Fixed offering from ENMAX) Here is a breakdown.

1000 kWh x $0.0580 = $58.00

$6.50 admin fee

Monthly Park Power electricity usage charges of $64.50

10 GJ x $3.50 = $35.00

$4.50 admin fee

Monthly Park Power natural gas charges of $39.50

Combined total Park Power electricity and natural gas usage charges over a 3 year term $1248.00

A savings of $336.00 

Delivery, Transmission and Local Access Fees will remain the same regardless of which retailer a consumer chooses.

So if you really want some fancy light bulbs in your home you can purchase them with the money you can save by choosing Park Power.

Shop Local Save Money

 

TransAlta Power Price Manipulation & Alberta Consumers.

· · Leave a Comment Consumer Info, Electricity, Interesting, Uncategorized

The editorial cartoon published Wednesday July 29, 2015  was somewhat disingenuous and misleading.  Residential and small business consumers buying electricity, based on “guaranteed energy rates” provided by competitive retailers like Park Power, are totally shielded from impact as presented in the MSA report of TransAlta with-holding generation with the intent of artificially pumping up the Power Pool wholesale market price of energy.

 

The situation of TransAlta attempting to manipulate the wholesale market happened a few years ago: Nov 19, 23, and Dec 13-16th of 2010 plus Feb 16th 2011.  It is true that some market participants were negatively impacted by spiking Power Pool Prices: BUT NOT those customers who had signed a fixed rate contract.  They were protected.

 

Here are some interesting numbers to put the history of Power Pool Prices into perspective.

 

In the wholesale market the price of electricity changes every hour and during some hours (based on supply and demand) it spikes, but what goes up always comes down.  The average wholesale price over the last 15 years is $64.60 / MW (this is the average of over 125,000 hours of prices posted by AESO).  What does the market look like today?  The numbers are in for July: $23.61/MW.  AESO’s wholesale price last month was 64% below the industry 15 year average.

 

What can you assume from these numbers?  Deregulation is  working for the benefit of consumers.  Since 2001 there have been 5 months where wholesale prices charged by generators have been below $25/MW (3 of which occurred this year).  How does this translate to what consumers are paying?  Those who are buying electricity indexed to the floating rate actually paid approximately 3.5 ¢/kWh this July.  Wholesale prices in July were the 4th lowest month since the birth of deregulation.

Historical Low Pool Prices

 

The Power Pool 12 month rolling trend (to July 2015) is currently running at $36.80 / MW.  This is approaching the lowest prices in Alberta which were posted in 2002 with the pool prices at $36.41.  Over the last 3 years as new generation units have come online – energy prices have been in free fall.

Pool Price 2001-15

One can approach their electricity rates just like they would approach bank interest rates.  When rates fall and if you think that they are near the bottom, it is a great time to lock in.  The average power pool price over the last 12 months are nearing record lows so locking into a fixed rate now is good advice.  As an example, for the senior pictured in the cartoon; the Guaranteed Fixed Rate offered by Park Power to seniors is 6.30 ¢/kWh guaranteed to December 2017.

Again, don’t believe all the negative hype about the utilities industry.  Some of us are actually working for the consumer and saving them time and money while offering options to protect themselves against drastic price changes in the market.

 

Shop Local Save Money