Are alternatives to utilities better?

BUFFALO, N.Y. (WIVB) - Cold weather's on the horizon and many western New Yorkers are thinking about the expense of heating their homes this winter.

"Energy Service Companies," or ESCOs for short, are private marketers that are designed to get electricity or natural gas into your home cheaper than your public utility. But recent studies show that for residential customers, ESCOs are falling short of expectations.

The utility costs for heating and lighting your home are the lowest they have been in at least four years. But there are more than 100 private marketers operating in New York that were supposed to bring prices down even more.

For large commercial customers, they are working well. But studies show most residential users of ESCOs are not doing as well.

Back in the 1990s, state officials set up the framework to give consumers alternatives to the natural gas and electric utilities. They were supposed to be cheaper alternatives. A lot of fanfare accompanied the roll out of "Energy Choice" in New York, but about 10 years later, studies show that even when the alternative supplier is cheaper, it is not by much.

An AARP representative said, "We are very disappointed to see that because the whole promise of energy deregulation in New York was going to be lower prices for residential ratepayers when they went to ESCOs, and now we are finding out that that may not be true."

The State Public Service Commission is embarking on a detailed study of how these energy marketers operate in the state with the eventual goal of getting their services, when appropriate, to residential customers who can benefit from them.

A spokesman for the Public Service Commission said, "What we want to ensure is that a consumer who does business with an ESCO is fully aware of the costs that are associated with it, and to make sure that the consumers is getting the best deal for their buck."

National Fuel Resources is a local ESCO with a clientele that is 90-percent commercial, but last winter, spokesman Joseph Delvecchio said, "A typical variable National Fuel Resources residential customer would have paid about two-and-a-half percent less than if they were with the utility."

There is a lot of information out there to help consumers make an informed decision, when trying to choose between leaving your utility for an ESCO or just staying put.

You can find more on the Public Service Commission's webpage about ECSOs and how to file comments regarding ECSOs with the commission.