Direct Energy Enters BGE Residential Gas Market

Direct Energy has entered the Maryland residential gas market with a 12-month fixed offer to customers at Baltimore Gas & Electric.

Direct is offering BGE residential customers a 12-month fixed price of 69.9¢ per therm with no cancellation fee.

BGE's cost of gas, which changes monthly, is currently 63.04¢ per therm for residential customers. In the past six months, the cost of gas has fluctuated as much as 10¢ per therm one month to the next.

Direct's offer will be supported through a variety of marketing channels, including direct mail, web, and some radio ads.

At this time, there is no bundling or tie-in with Direct's residential electric offers in Maryland.

BGE is the only Maryland gas utility that has enacted Purchase of Receivables, though implementation is anticipated at Washington Gas Light in the next two months or so pending final approval from the PSC (12/22). POR at Columbia Gas is under further investigation from the PSC due to what would be an unworkably high discount rate if all costs of various gas market enhancements were recovered through the discount rate.

Direct did not wish to make any definitive statement about residential plans for other Maryland gas utilities at this time. We also took the opportunity to ask Direct about the residential electric market at ComEd, but Direct did not offer any concrete plans for the market.

As of September 2010, which is the most recent data posted by the PSC, 10.4% of BGE residential gas customers have migrated to a competitive supplier.