Natural gas sends all energy rates higher

DELAWARE – Starting May 1, Delmarva Power starts to rely on other companies to supply electricity to its customers. That means signing fixed-priced contracts that last between one and three years.

Such contracts are always more expensive than buying power directly through the regional grid operator, PJM Interconnection, said Louis Monacell a lawyer who represents the Delaware Energy Users Group, a loose coalition of about a dozen of the biggest industrial companies in Delaware, including DuPont, General Motors and Citisteel. That is why those companies buy their power directly through PJM, even though prices can fluctuate wildly, especially during summer and winter.

Even though they cost more, Delmarva uses contracts because it is required by the deregulation law to provide a guaranteed amount of energy at a stable price.

At the time, no one realized natural gas prices would rise so high so quickly, said Monacell, who helped draft the deregulation bill.

News Journal (Delaware)