I am sorry I was warned to use notepad and did not. So the former post on this subject was all lumped together and harder to read. This is an easier version to read. I’m bothering to do this because I think this is important to know.
Friday’s paper had a column about DTE customers and their ability to subsidize renewable energy by opting to buy the alternative energy sources. I don’t like the word subsidize. Ever since the deregulation of electricity in Michigan there has been much subsidizing going on already. The public was warned that deregulation would cost a rise in consumer electricity bills.
“As predicted, all the benefits of deregulation are going to investor-owned utilities in the form of multi-billion dollar bailouts, and to large industrial and commercial customers who have the clout to negotiate lower electricity prices. Meanwhile, residential and small commercial customers are receiving few if any benefits as electricity in many deregulated states is still more expensive than the national average.”
There is basically no free market system. It is still a monopoly but is now unregulated. The larger investor-owned utility holding companies offer lower rates to the big block buying power of larger consumers affiliated with them. These utility holding companies cross subsidize their unregulated subsidiaries with revenues from us. We are unable to realize really low and fair pricing elsewhere. This is the control I complain about.
“In short, state-led deregulation has created unregulated monopolies to the detriment of consumers, competitors, workers, and the environment.”
A good example of buying power and offsetting costs to consumers was the rise in gasoline prices when America’s own oil reserves were opened but foreign oil was not cut off. The idea of opening our reserves is to bring relief to all consumers. Foreign oil imports are stopped or slowed during this time so that their cost to us drops because of lower demand. It is the first time any president/administration opened our reserves but did not cut off foreign oil imports. The result was that the lower priced American oil reserves were given or allotted to big industry, which may or may not have been a company like DTE, while you and I paid dearly for the expensive imported foreign oil instead. We literally paid for the reduction of costs to the big guys who did not pass that reduction of cost onto us in the form of lower bills.
There is plenty more to be read about the deregulation of energy utilities I’ve already cited at:
http://www.citizen.org/cmep/energy_enviro_nuclear/electricity/deregulation/articles.cfm?ID=4165.
The above article is not the easiest to understand if we are not adept at financial jargon, but as a way of fortifying what I did manage to understand, that the cost of deregulation would indeed be passed on to consumers, I dug up my old electricity bills. This April’s electricity bill is $21.00 higher than it was in April, 2004 even though I’ve cut back on my consumption, and changed out the requisite low energy bulbs in my house. They should be lower due to competition. Which proves there really is no competition.
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On another note, DTE’s CEO Anthony Earley recently spoke to Michigan’s congress about reversing deregulation in Michigan. Their monopoly would be regulated once again, and I assume our utility bills would drop also. Adding rules to the already deregulated market could achieve the same results however, where there would be no monopoly at all. The lure I imagine is that if my bill dropped the $21.00, I might be more enticed to take the plunge to add the 2 cents per kilowatt-hour back onto my bill. But I’m still a little reticent about incurring any costs at all. Remember not long ago DTE announced in the Free Press they would continue production (coalburners) as usual for the next 20 years. Now they are offering renewable sources at a little higher cost that is past onto us. This is the other thing I complained about, picking up the tab for a companies poor foresight as far as environmentalism. We shouldn’t. I found another article on:
http://www.ens-newswire.com/ens/oct2004/2004-10-20-03.asp that states:
October 20, 2004 (ENS) - The Energy Department and the private sector are beginning to roll towards the creation of a hydrogen economy to replace today’s petroleum economy. On Tuesday, the agency awarded more than $75 million in hydrogen research projects, a figure that mounts to nearly $100 million when private sector contributions are added. In addition, a hydrogen technology park opened Tuesday in Michigan with the ability to produce hydrogen to refuel fuel cell vehicles.
The high tech facility in Southfield, Michigan is the result of a partnership between the Department of Energy (DOE) and DTE Energy to develop, install and operate a multi-use renewable hydrogen station. “Today’s opening of the Hydrogen Technology Park is an important step forward,” said Acting Under Secretary David Garman. “Projects such as the one here in Michigan will enable industry to reach a 2015 commercialization decision with hydrogen fuel cell vehicles.”
Now I’m really confused because that article is dated 2004. And the government through the Energy Department helped subsidize the park. So why is it we as consumers are just now being offered alternative renewable sources and asked to subsidize them as well? Why would DTE, not long ago, announce they would continue as usual for the next 20 years? I will be posting another article soon about the ability to convert coalburning facilities to produce hydrogen. Hydrogen can be used for many things besides vehicles.
You know until it is all put together and explained in terms the general public understands from before deregulation until the present I don’t think I will make any moves to invest. Something is not right. DTE ignored environmentalism as long as possible to squeeze what they can out of their investment in fossil fuels by squeezing us when in fact they own every aspect of the industry from the coal, to the trucking, the grids and lines, etc. We should have the lowest bills in the country, yet they’ve risen and now we are asked to pay more again to go green. Let it come out of their pockets. I’m tired of the little guy suffering more than those at the top. Small businesses don’t have that luxury. I owned my own business. If I made mistakes, or decided to switch my methods, the cost came out of my income first in order to save my business. I could not pass the cost along to customers because of competition. It should be likewise for big business, which is afforded the luxury of bailouts, cross subsidizing, and unregulated monopolizing. And they have little to fear from competition. Yet they turn around and raise the price for consumers anyway.