FREDERICK NEWS-POST
Local businesses research
electricity cooperative
By JOSEPH M. DELEON
News-Post Staff
jdeleon@newspost.com
FREDERICK — A group of 10 Frederick business owners gathered Wednesday at Goodwill Industries in Frederick to look at zigzagging line charts and tedious price schedules. It confirmed what they already knew — electricity prices are rising.
In 2004, Maryland businesses paid 7.6 cents per kilowatt hour, a more than 20 percent increase from the 6.3 cents per kilowatt hour in 2002, according to the Maryland Energy Administration.
A kilowatt hour is equal to 1,000 watts being used continuously for one hour — the same as running a 19-inch television four hours or a clothes dryer for about 15 minutes, according to EnergyVortex, an energy industry news group.
The business owners hope to combine their buying power to save money on electricity. They will request bids from energy companies by Oct. 27 and could hear back as soon as the second week in November.
By banding together, they share the cost in preparing to solicit bids from competing electricity providers, eliminate the time needed to learn how the process works and predict next year’s budget needs.
Businesses in areas served by Baltimore Gas and Electric, Delmarva Power and Light Company, Allegheny Power and the Potomac Electric Power Company can shop for electricity contracts offered by more than 12 competing retail energy providers in Maryland, such as Direct Energy Services, Washington Gas Energy and Strategic Energy.
That was made possible by legislation in 2000 that allowed some Maryland residents to begin shopping for new electricity suppliers July 1, 2000, while businesses had to wait until Jan. 1, 2001.
CQI Associates coordinated more then 40 energy deals in 16 states since 1999, according to the company’s Web site. The company negotiated the first of 20 chambersponsored electricity co-ops in Maryland in Ocean City in 2003.
Climate changes, terrorism and increased energy consumption in China, India and the United States, among other factors, have combined to push energy costs.
Warmer than usual summers for the past two years and hurricanes Katrina and Rita caused an increase in electricity use and decline in U.S. oil production, respectively, according to the Energy Information Administration.
Residents in the United States have increased their use of electricity about 2.4 percent every year since 1995, according to the Energy Information Administration. While people in the United States used about 3.5 billion kilowatt hours per day in 1995, last year that number rose to about 5 billion kilowatt hours per day.
The average household consumes about 8,900 kilowatt hours each year, according to a 2005 Energy Information Administration report.
Nationwide, commercial electricity prices are expected to increase by 10.2 percent to 9.56 cents per kilowatt hour in 2006 from 8.67 cents per kilowatt hour in 2005 because the costs of fuels for generating electricity have risen. Another reason is restructured electricity markets have loosened retail electricity price caps, such as in New England and the Southeast, according to the Energy Information Administration.
