BGE offers options in gas Utility will permit residents to purchase from third parties

Details in April bill

Pilot program spurs price competition

deliveries unchanged

March 30, 1997|By Robert Nusgart | Robert Nusgart,SUN REAL ESTATE EDITOR

When Baltimore Gas and Electric customers open their April bill, they'll find a notice telling them there's going to be a new way of conducting business for gas users.

"Gas Options" is a pilot program that BGE is beginning to roll out, and the name describes the program exactly.

Instead of BGE purchasing natural gas for its homeowners, those customers who participate will be able to select their own from third-party marketers. The program, approved by the state's Public Utilities Commission as a way to increase competition, acts much in the same way as long-distance telephone companies vie for that dollar.

"All along we've been educating the customer about the impending changes," said Chris Walls, program administrator for residential marketing and energy services at BGE. "At this point. the April billing will actually detail the program and give an 800-number for customers to call, and from that number they can talk to a person who is trained in the program details.

"They can request an information package that we're in the process of developing right now. It will give them all the details they will need to know to make an informed choice, minus any input they might get from the gas marketers," he said.

BGE intends to invite 25,000 of its gas customers into the program. By mutual agreement among the marketers, advertising and full-scale marketing won't begin until May 1. That would give BGE enough time to notify customers of the changes so that "when marketers begin calling on them and communicating with them they will not be totally taken aback," Walls said, adding that so far 10 marketers have expressed interest in joining the program.Walls was also quick to stress that the change only affects the purchasing of gas, not the delivery of it.

"It's simply now a third-party marketer will purchase the gas for a customer and will deliver it to the city gate and BGE will deliver it to the home," Walls said, adding that homeowners should still call BGE for any issues concerning maintenance or leaks. Customers will be able to enter the program, beginning Aug. 1. The sign-up period will last until April 8, 1998. The program ends Oct. 31, 1999.

The program isn't the first of its kind in the state. Last September, customers of Washington Gas Light Co. in Prince George's and Montgomery counties had a chance to enter into its two-year program. That program attracted 6,300 participants, according to Walls. Also, Columbia Gas Co. introduced a similar pilot in Western Maryland in November. Other states -- such as Iowa, Ohio, Massachusetts and New Jersey -- have such programs.

Industrial and commercial BGE gas users have been in a similar programs since 1995, and Walls said this is just a natural extension of that program.

"The benefit to the homeowner is that they will have new options," he said.

"The gas marketers will offer incentives and options in purchasing their gas. The main reason why we're having the pilot is to understand in great detail what kinds of benefits will come about as a result of having competition introduced into the gas industry."

Much in the same way telephone companies offer free minutes or cash payments to potential customers, expect marketers to do likewise.

Walls said incentives should range from cash incentives and gift certificates to price guarantees. But the bottom line will be trying to decipher if a customer will enjoy any savings on the monthly bill.

"Customers should be able to tell whether they're saving and what kinds of benefits they are getting because of this program," Walls said. "They need to review their current bill and compare that to subsequent bills as to whether they've made the best choice or not."

He added that BGE will be doing its own reviewing and customer research during the program.

"We're trying to find out how customers will react to these new options and choices and what we can learn as a utility as to what benefits they see. That will assist us in designing and developing better programs in the future," Walls said.

Pub Date: 3/30/97

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