Retail Marketing and Choice

José Antonio Vanderhorst Silverio, PhD
In(ter)dependent Consultant on Electricity

DR1 had a story yesterday on electricity market distortions that said "A report in Hoy newspaper’s economic section focuses on the distortion in the Dominican electricity market that rations the consumption of paying clients, while at the same time stimulates the consumption of those that do not pay, affecting the financial sustainability of the sector. The non-paying consumers are heavily subsidized by the government at a cost of approximately US$450 million a year, while those who pay are penalized with high tariffs and consistent increases." As you can see, you are not alone. If Dominicans knew how to complain like you, the problem could be solved very soon.

I strongly believe that the solution is choice: retail competition of the commercialization of electricity. The retailer is an intermediary that will replace two intermediaries: the superintendent (regulator) and the monopoly of distribution (commercialization). One of the interesting dilemmas is that the distribution (and commercialization) monopolies are broke, but the want to keep the monopoly of commercialization. AES, an American company that runs (they say the sold it) EdeEste should lead the campain towards choice. EdeNorte and EdeSur will follow, if there is a strong case pro choice, as the government is required to privatize them again. El Paso, Smith-Enron, Cogentrix, are American investors on generation that should be interested in an electricity service that works properly. However, it seems that some of them have strong vested interests against choice.

If the customer is not satisfied with a retailer, there will be other retailers that will fit with the client-customer. Retailers will purchase electricity from generators, and distributors will charge only tolls for their service. I think that the problem is that American companies think global and act global. If they were to think global and act local the results will be much different.

I suggest that you write to Mr. Kevin Manning, the President of AMCHAM, who is also a high executive of AES, on this matter.



Quote:
Originally Posted by tuxedodan
Does any have the numbers for the SUperintendent of Lights? I want to call and complain. I know this won't solve anything, but I can try. The electric company "checked" my meter and put it back. The next thing I know i'm getting a a 50+% increase in billss?!!! One bill is 8500, when I usually get 2500, more or less. When I am home for vacation, I get a bill for 800, more or less. NOw its 2000. Nothing changed, same appliaces and same people. What the hell? I went and complained and they send someone who just said that the meter is FINE. What the hell man? The people at the company looked at my history and noticed a patter, but chose not to do anything!!! This is the problem with the company, laziness. At least someone in the states, there is someone to always complain at. I wish the people at the company and do something. The rate is too low and yet the goods are still too high. I have friends who pay 1000 and they use wayyyyyy more electricity than me for sure. What is wrong with this country? First, its blackouts then its high electric bills! I pay 200usd at my house in the states, and we have lots of more things running, but i have an apt here!!! Don't get me wrong, I like the people and country. I just hate the stupidness and laziness, because those are things that tear down strong foundations. Thanks for listening me releasing my anger.