Page 11 - PCCA Journal 1st Quarter 2012

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PCCA Journal|1
st
Quarter 2012
11
goal of protecting consumers.
According to a recent report from
Pike Research, the competitive market is
poised for further growth in the com-
ing decade, as competitive electricity
purchases will nearly double from $29.4
billion in 2009 to $55.9 billion by 2020.
Regulatory policy, however, remains
the single biggest limiting factor on the
development of an open and competitive
market for electricity supplies to com-
mercial and industrial customers.
“Even though some 20 jurisdictions
have enacted restructuring laws and
policies designed to open their electricity
market to new competitors, only about a
dozen states allow for full-scale access to
competitive markets for all customers,”
said Pike’s Vice President of Research
Bob Gohn. “Even in these states, laws
and regulations tend to impose costs
that are meant to ensure that expenses
caused by the departure of other cus-
tomers to competitive suppliers are not
passed on to customers who remain with
incumbent providers.”
A decade after suspending new retail
competition in the wake of the power
crisis, California has begun opening
the door slightly to further access to
competitive providers in regulated utility
territories. Because the Californian mar-
ket is so large, this will have a significant
impact on both the total national market
and other states’ general perception of
how much pent-up demand there is for
competitive supplies. There are no indi-
cations that states that have previously
avoided restructuring have intentions to
reexamine their policies. However, sever-
al other states that have frozen their ef-
forts may restore competitive options for
larger customers. In particular, Arizona
and Michigan represent strong potential
markets for competitive procurement.
In general, increases in market activity
will take place over the next five years
in states that already have favorable
policies and in the 2015-20 period for
areas that still need to reexamine their
policies.
Pike Research’s report, “Corporate and
Institutional Procurement of Electricity,”
examines the critical role that electricity
plays in commercial and industrial oper-
ations, explores the motivations for seek-
ing non-utility and green power among a
variety of business types, and identifies
existing policies that promote competi-
tion as well as barriers that may inhibit
further access to competitively priced
power. The report includes profiles of
key industry players and forecasts for the
News Briefs continued on page 12
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