Green Mountain Energy Co., an Austin, Texas-based electricity provider, has scaled back its California operation, returning most of its customers here back to their previous electric utilities.
The company dropped 50,000 customers throughout California, including in Orange County, because of concerns over regulatory uncertainty in the state’s power sector, according to spokesman Rick Counihan.
“We’re very disappointed in the state’s response to the power crisis,” he said. “We and our customers became collateral damage in the financial meltdown that’s going on in the sector here.”
A bill passed by the Legislature and signed by Gov. Gray Davis this month prohibits Green Mountain and other alternative providers from signing up new customers, according to Counihan.
Also, when the Pasadena-based California Power Exchange Corp. closed its doors last month, companies like Green Mountain were left with no base against which to index the price of power to residential customers.
“Imagine a situation where you’re basing your salary on the consumer price index and the consumer price index is suddenly no longer published by the federal government,” he said.
The company still retains about 8,000 fixed-rate plan customers in South Orange County and San Diego who will pay a guaranteed rate of 8.5 cents per kilowatt hour until the end of the year.
“We would like to offer them continued service beyond 2001, but it’s too soon to tell whether the state will allow us to do that,” Counihan said.
Green Mountain started signing Pacific Gas & Electric, Southern California Edison and San Diego Gas & Electric customers in 1998 following partial deregulation of the state’s electricity sector.
Municipal utilities like the Los Angeles Department of Water and Power and Anaheim’s Public Utilities Department do not allow their customers to sign on with other providers.
Green Mountain plans to maintain its California administrative office in San Francisco for the time being, Counihan said. The company buys all its power wholesale from what it terms “green” sources of electricity, wind, solar, natural gas, hydroelectric and landfill gases.
Green Mountain supplies electricity to deregulated market customers in Pennsylvania, New Jersey and Connecticut.
BP Amoco PLC owns a 19% stake in the company. Green Mountain also is partly owned by Amsterdam-based Nuon International, the Netherlands’ largest utility company.
Green Mountain Energy Co. has about 100 employees nationally, including 70 in Austin and 10 in California. The company recorded $2 million in 1999 sales.
