I have described problems that BGE customers have had involving Ohms Energy, a local electricity broker and aggregator. Many involved people who thought they had locked in a 9.4-cent "price to compare" (generation & transmission but not distribution) beyond June 1 through Ohms. They got letters from BGE saying that ConEd Solutions (the generator) was ending service in Maryland and that their 9.4-cent rate would go away. Ohms has promised to honor the deals anyway, and the evidence so far is that they are. Here is an email I got from an Ohms customer:

I would like to thank-you for your article on 10/15/06 on 'looking to save on electricity?' Following the info you provided I was able to contract with Ohms Energy on 12/20/2006 for 0.094kwh. After reading your recent article(5/2/20070 where you mentioned ConEdison Solutions would not be selling electricity after June) I talked to Ohms Energy. On 5/30/2007 I received an email from Trish Greene, Asst. Manager-Pikesville Ohms Energy, stating my supply will roll over from Con Ed right to Ohms Energy with the rate 0.094kwh for the year. Thanks for keeping me informed and allowing me to stay on top of this issue.

Posted by Jay Hancock at 8:03 PM | Permalink | Comments (0)
                    

The commenters are correct. This year's 50 percent increase comes on top of last year's 15 percent increase, which gives you a total, two-year increase of more than 70 percent. See an expanded version of the Q&A below in Friday's Sun.

Posted by Jay Hancock at 7:38 PM | Permalink | Comments (0)
                    

Thanks to many alert readers (see comments) who noted that a 50 percent increase on top of a 15 percent increase does NOT equal 65 percent. There is such a thing as compounding, which most of us (me too, I swear!) learned about in sixth grade. My assumption was that the 50 percent was not compounded on top of the 15 percent, that both were calculated from the BGE base price of pre-July 2006. I still think that's correct, but I will go check and report back in the next day or so. Now I gotta go write a Sunday column.

Posted by Jay Hancock at 9:28 AM | Permalink | Comments (0)
                    

Looks like Chinese authorities will have to do more than increase the transaction tax to let some air out of their stock bubble. Shanghai shares, which fell 6.5 percent yesterday on news of the tax increase, came back this morning.

The exchange here involves China "A" shares, which are traded in yuan and available to Chinese investors. This thing may end up making the Nasdaq stock bubble look small. Chinese investors are plump with cash, thanks to America's enormous trade deficit with China. Because the country has been communist for 60 years, they've never been able to buy stocks and never seen a bull market up close. Valuations now are something like 40-50 times earnings -- what Japan and the Nasdaq sold for before they cratered in the 1990s and 2000s, respectively. The kicker in China is the communism: This country is allocating trillions in capital by bureaucratic decree, not market signals. At some point the whole thing is going to cave. Yesterday I made fun of Alan Greenspan for spouting off on the Chinese bubble. But he's right.

Posted by Jay Hancock at 9:16 AM | Permalink | Comments (0)
                    

Here is excellent advice from a shrink at the University of Colorado. He claims to have found that vacations make people happier than fancy cars or dresses or homes. He seems to focus too much on blotting out negative memories of vacations. (Bad experiences seem to be more a function of a specific vacations than an attribute of vacations generally.) And his example of a great vacation -- a visit to Disneyland -- is not one I would have chosen. But the underlying message is one I try to inculcate in my kids: It's more important to invest in experience than stuff.

Here's more from the press release they put out on the prof, Leaf Van Boven:

Shopping for that new high-definition television this summer? Skip it, and take a vacation instead, says a University of Colorado at Boulder psychologist who studies happiness.

Assistant Professor Leaf Van Boven has conducted numerous surveys and experiments spanning several years and has found that life experiences, such as vacations, generally make people from various walks of life happier than material possessions...

Another reason he cites for hitting the road over buying the new TV is that experiences contribute to social relationships. "They have more of what we refer to as social value, and we know that social relationships are a huge component of well-being and life satisfaction," Van Boven said.

Closely tied to this idea that experiences have more social value is that people also usually have intrinsic motivations for pursuing experiences like vacations.

"One of the things that people tell us is that when they pursue experiences they often do so out of a desire to satisfy intrinsic goals, so they will go backpacking or skiing because they want to challenge themselves, they want to push themselves in new ways," he said.

Material things are much less likely to be viewed that way. In fact, Van Boven says people who pursue experiences more than material things are often more popular with others too.

"When you are known as being experiential you become a more likeable person than when you are known as a materialistic person," he said.

Posted by Jay Hancock at 2:53 PM | Permalink | Comments (0)
                    

Even BGE employees are probably having a hard time remembering what's going on. As we keep reporting, electric prices for the typical BGE home will go up 50 percent starting Friday. Here are some common questions about the change:

1. Are prices rising 50 percent after they already rose 72 percent last year?

No. Last year's widely reported 72 percent rise was held by the General Assembly to a 15 percent increase only. This week's 50 percent increase comes on top of that 15 percent, to attain a total, two-year increase of about 65 percent.

2. Why isn't the total, two-year increase 72 percent, as it was originally supposed to be?

BGE bought some of its juice for 2007-2008 last winter, when energy prices had dipped. So this year's price is slighly lower than what some thought it might be.

3. Is my total BGE bill going up 50 percent?

No. Just the electricity portion. If you're a BGE gas customer, that's a separate item. The 50 percent refers to the increase in your total electric bill, not just the "electric supply" portion that includes the cost of generation and cross-country transmission. The other major component of your electric bill is BGE's "distribution" charge for piping the juice across local wires. That has not changed. The increase in the electric supply price alone is more than 50 percent.

4. Should I take BGE's new deferral plan, which would keep the increase less than 50 percent for seven months?

I don't see any reason to unless you can't afford an extra $50 or $100 a month on your electric bill. The full, 50-percent pop is delayed only until the end of the year. And then you have to start paying back the part you deferred. Even though the loan is interest-free, the payback period is less than two years, which will make your electric bills bigger than normal in 2008 and 2009.

5. Deregulation was supposed to mean we could shop around for a rate lower than BGE's standard price. What are the alternatives?

As a practical matter, there aren't any right now. Because BGE locked up part of the next 12 months' supply when rates were lower last winter, competitors are having a hard time beating its "price to compare," which is 10.713 cents. (That's an average over 12 months for generation and transmmission.) For example, Commerce Energy's price to compare these days is 12.7 cents, which would cost the typical household an extra $20 a month. Washington Gas Energy Services is offering a two- or three-year deal for 11.3 cents, which would be smart to take only if you believe electricity prices will soar even higher.

Posted by Jay Hancock at 6:47 PM | Permalink | Comments (10)