Benita Dodd defends

Benita Dodd of the Georgia Public Policy Foundation defends Georgia’s quasi-deregulated natural gas system:

Consumers like consistency, which is one of the attractions of regulation. The question is, are Georgians worse off since deregulation? First, now customers can choose providers. The Web site www.GasGeorgia.com provides a list of providers in a given ZIP code and offers a comparison of prices. For 30066, Marietta, the site listed six providers – a far cry from the single provider of 1997. Providers offer customers special offers, including a choice in sign-up incentives and no fee for an unhappy customer to switch or terminate services; some waive any monthly charge.

Second, the competitive marketplace has provided Georgians with the choice of locking in a long-term rate in a six-, 12- or 24-month contract or, taking the chance that natural gas prices – and the weather – will remain fairly stable, choose to go with a variable monthly rate.

Much has been made about the high prices in Georgia: Nationally, residential customers paid $14.76 per 1,000 cubic feet in December 2005, according to the Energy Information Administration. Georgians averaged $19.34 per 1,000 square feet, which was a 47.4 percent increase over December 2004. Tennesseans averaged $17.23 last December, a 52.9 percent increase. South Carolinians averaged $19.32, a 55.8 percent increase. But customers in those two states were unable to make a choice among marketers or lock in lower rates.

In fact, according to an analysis by Atlanta Gas Light, a Georgia customer in a midsize home using 150 therms of natural gas per month could pay an average of $196 on a fixed rate plan; $242 on a variable rate plan or $273 to a municipality not affected by the deregulation of Atlanta Gas Light. By contrast, the same customer would have paid $269 in Alabama; $256 in Tennessee, $245 in North Carolina; $277 in South Carolina and $282 in Florida.

Read the entire article here.

Personally I would like to see a totally free market for natural gas, but to re-regulate, as urged by Georgia’s Democrats, is a really bad idea.

4 comments

  1. Bill Simon says:

    Well, if you are in favor of that, Buzz, then I presume you would be against the financing of the pipeline that Atlanta Gas Light wants the people of Georgia to pay?

    In a true “free market,” Atlanta Gas Light would have to risk the venture all on its own.

  2. atlantaman says:

    The free market is a double edged sword. You can’t expect AGL to assume all the risk and then not allow them to profit from the venture. In the current regulated environment AGL’s profits are capped.

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