Washington Gas Energy Services Reports Customer Counts, Market Share, Discusses 2013 Strategy

Washington Gas Energy Services reported customer count and market share (of shopped load/customers) by state as well as margins during an analyst meeting last week.

WGES customer and annualized load data is as follows:

WGES Electric       PA         MD        DC        DE
Customers       29,558    136,298    10,760    10,172
% of Switched       2%        24%       27%       46%

WGES Electric        PA      MD      DC      DE
Sales (TWh)         1.1     8.7     1.6     0.7
% of TWh Switched    1%     27%     19%     17%

WGES Gas          PA       MD       VA    DE       DC
Customers      8,341   96,222   56,366    73   12,950
% of Switched     --      40%      71%   73%      66%

WGES Gas            PA      MD     VA    DE     DC
Sales (Bcf)         1.0   36.1   16.6   1.2   10.0
% of Bcf Switched    --    42%    18%    5%    58%

WGES said that its focus will be on continuing to build volume, customers, and market share in Pennsylvania, for both gas and electricity.

The Pennsylvania market entry has reflected several strategies, including targeting customers with a strong interest in green products, reliance on strong relationships with brokers and consultants in the mid-Atlantic, and focusing on commercial clients with multiple properties and other group aggregations.

Across all of its markets, WGES is targeting electric volumes of 12.4 TWh in FY 2013 and 16.4 TWh in FY 2016, with the biggest part of the growth (about 3.5 TWh) forecast to come from increased commercial sales. A smaller increase in residential volumes is forecast. WGES is not forecasting an increase in its current level of governmental volumes, though it said that it would serve additional volumes if such business produces suitable margins.

WGES forecasts growing its natural gas volume from 65.1 Bcf in FY 2013 to 74.2 Bcf in FY 2016.

WGES also reported that FY 2012 voluntary wind power sales were 729,000 MWh, while over 20,000 customers are now on a product that is 50-100% wind or, for gas, carbon offset.

Electric unit margins for FY 2012 (which for WGES ended September 30, 2012) were in the $6.50/MWh range.

Natural gas unit margins for FY 2012 were over $0.60/Dth