Market Rate Service - Additional Information
What is Market Rate Service?
It's a pricing program that gives customers the option to purchase electricity at actual market prices. Currently, most customers in our service territory purchase electricity under Standard Rate Service, which provides protection from most fluctuations in the market price of electricity. Customers who choose to participate in the Market Rate Service program will see the price they pay for electricity vary according to market conditions. Depending upon what actual market prices are each month, they may end up paying more or less than they would have paid under Standard Rate Service.
Is Market Rate Service being offered to all residential and commercial customers? Yes, but only a limited number of customers will be able to participate. A fixed amount of electricity (2150 gigawatthours) will be allocated to the Market Rate Service. Standard Rate Service customers will be allowed to transfer to Market Rate Service on a first-come, first-served basis until the allocation has been fully subscribed.
My bill has a section called "Electricity Supply Service charge." I thought this was considered the market price of electricity. Aren't I already paying the market price for electricity? Unless you chose Market Rate Service last year, you are not paying the market price for electricity. However, even if you are served under Standard Rate Service, you are correct that the Electricity Supply Service charge portion of your bill does reflect the actual market price of electricity. The Electricity Supply Service charge fluctuates with each bill depending upon market conditions. However, if you are served under the Standard Rate Service, the Delivery charge portion of your bill contains a line called the "Delivery Charge Adjustment," which provides partial protection against fluctuations in the market price of electricity.
The Delivery Charge Adjustment ensures that customers on Standard Rate Service pay the same amount—no more and no less—incurred by the Company to obtain electricity supply for them.
If I choose Market Rate Service, what will my charges be? You will pay the same Delivery and Electricity Supply Service charges as a customer served under Standard Rate Service, except you will not have a Delivery Charge Adjustment. As a result, the overall bill may be higher or lower depending on the actual market price of electricity.
What conditions cause market prices of electricity to fluctuate? Changes in the price of electricity are driven by a number of factors, such as supply and demand, weather, and fuel prices and availability.
How are the market prices calculated? For customers without interval meters, the actual price is a 30-day weighted average of the hourly electricity supply prices. In other words, we calculate a weighted average kilowatt-hour cost by averaging the prices for each hour of each day in the 30-day period. For example, if your meter is read on March 29, your weighted average price would be based on the previous 30 days' prices.
Do you know what the market prices for electricity will be in the future? No, because of the volatility in the market. We do have a record of the historical 30-day weighted average prices and corresponding Delivery Charge Adjustment factors.
Note: Our posted historical prices by service classification and load zone are the ACTUAL prices since September 1, 1998. These prices are NOT A FORECAST of future prices.
How much money can I expect to save if I choose Market Rate Service? Maybe nothing. In fact, your bill could be higher than it would be under the Standard Rate Service.
If I choose the Market Rate Service, can I return to the Standard Rate Service? You will have to stay on Market Rate Service for a minimum of 12 consecutive months. Once the 12-month requirement has been satisfied, you may return to the Standard Rate Service at any time by providing 30 days notice to us. Call 1-800-664-6729 if you are a non-residential customer or 1-800-642-4272 if you are a residential customer, or notify us in writing. You may also contact us.
If I choose to remain on the Standard Rate Service, may I switch to the Market Rate Service? Yes. Subscription for this program will remain open until the cap on the amount of electricity that can be served on this program has been reached.
Can I choose the Market Rate Service and still participate in the electric choice program? Yes. As of August 1, 1999, all customers in our service territory have the opportunity to purchase their electricity from an alternate supplier, regardless of whether they choose to be served under the Market Rate Service. You may choose to participate in the electric choice program at any time; however, the option to participate in the Market Rate Service can only be chosen during this subscription period. These two choices are independent of one another. Nevertheless, if you are interested in participating in the electric choice program, you may also want to discuss the Market Rate Service with potential suppliers.
Bear in mind that once you begin to purchase electricity from another supplier under the Standard Rate Service, we can no longer guarantee that you will pay no more than the Standard rate price, as discussed above. For more information, review our section on Energy Choice.
I'd like to choose the Market Rate Service. What is the next step? Please complete the Enrollment Application Form (pdf) and mail it to National Grid—Accounts Processing, 300 Erie Blvd West, Syracuse, New York 13202. Because the application is required to be signed by the customer and will be accepted on a first-come, first-served basis, applications sent via e-mail or fax will not be accepted.
May I fax or e-mail my application? No, because your signature is required.
Are there any customers not eligible to participate in the Market Rate Service? Customers taking service under the Empire Zone or customers with Economic Development Power (EDP) or Power For Jobs (PFJ) allocations are only eligible for the Market Rate Service to the extent that they purchase a portion of their load from National Grid at standard tariff rates.
Is Market Rate Service being offered to all residential and commercial customers? Yes, but only a limited number of customers will be able to participate. A fixed amount of electricity (2150 gigawatthours) will be allocated to the Market Rate Service. Standard Rate Service customers will be allowed to transfer to Market Rate Service on a first-come, first-served basis until the allocation has been fully subscribed.
My bill has a section called "Electricity Supply Service charge." I thought this was considered the market price of electricity. Aren't I already paying the market price for electricity? Unless you chose Market Rate Service last year, you are not paying the market price for electricity. However, even if you are served under Standard Rate Service, you are correct that the Electricity Supply Service charge portion of your bill does reflect the actual market price of electricity. The Electricity Supply Service charge fluctuates with each bill depending upon market conditions. However, if you are served under the Standard Rate Service, the Delivery charge portion of your bill contains a line called the "Delivery Charge Adjustment," which provides partial protection against fluctuations in the market price of electricity.
The Delivery Charge Adjustment ensures that customers on Standard Rate Service pay the same amount—no more and no less—incurred by the Company to obtain electricity supply for them.
If I choose Market Rate Service, what will my charges be? You will pay the same Delivery and Electricity Supply Service charges as a customer served under Standard Rate Service, except you will not have a Delivery Charge Adjustment. As a result, the overall bill may be higher or lower depending on the actual market price of electricity.
What conditions cause market prices of electricity to fluctuate? Changes in the price of electricity are driven by a number of factors, such as supply and demand, weather, and fuel prices and availability.
How are the market prices calculated? For customers without interval meters, the actual price is a 30-day weighted average of the hourly electricity supply prices. In other words, we calculate a weighted average kilowatt-hour cost by averaging the prices for each hour of each day in the 30-day period. For example, if your meter is read on March 29, your weighted average price would be based on the previous 30 days' prices.
Do you know what the market prices for electricity will be in the future? No, because of the volatility in the market. We do have a record of the historical 30-day weighted average prices and corresponding Delivery Charge Adjustment factors.
Note: Our posted historical prices by service classification and load zone are the ACTUAL prices since September 1, 1998. These prices are NOT A FORECAST of future prices.
How much money can I expect to save if I choose Market Rate Service? Maybe nothing. In fact, your bill could be higher than it would be under the Standard Rate Service.
If I choose the Market Rate Service, can I return to the Standard Rate Service? You will have to stay on Market Rate Service for a minimum of 12 consecutive months. Once the 12-month requirement has been satisfied, you may return to the Standard Rate Service at any time by providing 30 days notice to us. Call 1-800-664-6729 if you are a non-residential customer or 1-800-642-4272 if you are a residential customer, or notify us in writing. You may also contact us.
If I choose to remain on the Standard Rate Service, may I switch to the Market Rate Service? Yes. Subscription for this program will remain open until the cap on the amount of electricity that can be served on this program has been reached.
Can I choose the Market Rate Service and still participate in the electric choice program? Yes. As of August 1, 1999, all customers in our service territory have the opportunity to purchase their electricity from an alternate supplier, regardless of whether they choose to be served under the Market Rate Service. You may choose to participate in the electric choice program at any time; however, the option to participate in the Market Rate Service can only be chosen during this subscription period. These two choices are independent of one another. Nevertheless, if you are interested in participating in the electric choice program, you may also want to discuss the Market Rate Service with potential suppliers.
Bear in mind that once you begin to purchase electricity from another supplier under the Standard Rate Service, we can no longer guarantee that you will pay no more than the Standard rate price, as discussed above. For more information, review our section on Energy Choice.
I'd like to choose the Market Rate Service. What is the next step? Please complete the Enrollment Application Form (pdf) and mail it to National Grid—Accounts Processing, 300 Erie Blvd West, Syracuse, New York 13202. Because the application is required to be signed by the customer and will be accepted on a first-come, first-served basis, applications sent via e-mail or fax will not be accepted.
May I fax or e-mail my application? No, because your signature is required.
Are there any customers not eligible to participate in the Market Rate Service? Customers taking service under the Empire Zone or customers with Economic Development Power (EDP) or Power For Jobs (PFJ) allocations are only eligible for the Market Rate Service to the extent that they purchase a portion of their load from National Grid at standard tariff rates.
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