The Economic Growth through Competitive Energy Markets Coalition (CEM), an organization representing thousands of commercial and light industrial consumers working for the enhancement of the competitive electricity market in Pennsylvania, believes that a study made available by PJM Interconnection (PJM) is yet another indication that economic regulation through the old regulatory paradigm results in higher costs to consumers than a more competitive marketplace. As a result, there is every indication that continuing on the path of competition leading to robust sustainable markets will result in further benefits to consumers, CEM said.

The Pennsylvania Electricity Generation Customer Choice and Competition Act correctly points out that competitive market forces are more effective than economic regulation, CEM said.

"This study is yet another indication of the benefit to the commonwealth's business electricity consumers of a real, workable competitive electricity market, said CEM participant Cliff Shannon, president of the 4000-member small business organization SMC Business Councils. "Only a truly competitive marketplace will result in the best possible electricity price, offer the range of choice that consumers want, and contribute to an improved climate for business development," Shannon added.

The study explores the question of how consumers in Pennsylvania, New Jersey and Delaware have fared during the ongoing transition to fully competitive energy markets by comparing the generation portion of unbundled default service rates to the generation portion of the old regulated bundled paradigm. It should be noted that the study did not evaluate the merits or appropriateness of a particular retail market model. The study was prompted by the fact that several Mid-Atlantic states are nearing the end of their transition period to a more competitive market, and policymakers in those states are considering the next steps for progressive and lasting competition in those markets.

The study was conducted by Synapse Energy Consultants (Synapse), a firm with a long history of working on behalf of consumer advocate clients on behalf of PJM. Synapse's study for PJM recreated what a traditionally regulated electricity price would have been in the period 1997 to 2003, then compared those prices to the actual default service energy prices consumers paid in that period. Synapse explored three representative companies' filed rates. The three companies included in the study were Jersey Central Power & Light (New Jersey), Delmarva Power & Light (Delaware) and Pennelec (Pennsylvania).

PJM manages the efficient and reliable movement of electricity in all or parts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and the District of Columbia.

"Maryland consumers in all customer classes have benefited as a result of wholesale competition, one of the fundamental elements of a robust and sustainable retail market," said Kenneth D. Schisler, chair of the Maryland Public Service Commission. "Wholesale competition will play a critical role as Maryland continues its transition to retail competition," Schisler added.

"The study reinforces the case that competitive energy markets open the doors to innovation," commented Carol J. Murphy, who recently served as a member of the New Jersey Board of Public Utilities. "Competition gives customers the option to choose from a wide range of products and services, including renewable resources and tools that allow them to control their energy costs," Murphy stated.

"CEM supports an enhanced competitive market in Pennsylvania," stated Shannon. "An enhanced competitive market will allow additional benefits to flow to Pennsylvania's commercial and light industrial consumers-the engine of the commonwealth's business development and job growth," added Shannon.