May 17, 2013

Free market competition in Arizona’s electricity market is likely, says energy analysts. Those in charge of utility regulations in Arizona support reviving deregulation and opening electric choice to not only larger businesses but residents and small businesses as well.

Deregulation would mean that electric customers would be able to purchase their electricity supply from competing retail electricity providers instead of being forced to purchase directly from the default utility, either Arizona Public Service Co. or Tucson Electric Power.

Bob Stump, Chairman of the Arizona Corporate Commission (ACC), which oversees public utilities in the state, said in a press release: “We will prudently and cautiously examine how other states have fared under retail competition and ponder whether the time is right for Arizona to follow a similar path.”

Commissioners have set up two public meetings and will gather information from various stakeholders about whether or not Arizona will follow through with opening up to electric choice.

Arizona began deregulating its electricity market in the late 1990s, along with other currently deregulated states. However, a judge’s decision in 2004 stopped deregulation. The state does have a small lottery system for commercial and industrial customers, but smaller businesses and residents are now allowed to participate.

Direct Energy Seeking to Enter Arizona Electricity Market

Direct Energy is prepared to enter the Arizona electric market. The retail electricity provider submitted a Certificate of Convenience and Necessity (CC&N) to the ACC this month in order to enter the market and serve retail customers in the state.

The retail electricity provider has already demonstrated corporate commitment to the state. Direct Energy has a call center in Tempe as well as a current contract with a vendor to establish another significant call center in the city. Furthermore, the provider has two retail electricity contracts with commercial customers that were able to participate in Arizona’s electric choice lottery.

Direct Energy is one of the largest retail electricity providers in North America, operating in 46 state with more than 6 million residential and commercial customers.