Competition emerges for energy service

Brad Boehm of Glenview didn't have any problems with ComEd's power or customer service, but he did want to save money in this tough recession.

So, when BlueStar Energy Solutions sought participants over a year ago for its electricity pilot program for the residential market, Boehm signed up via the company's website. He said his single-family home started to save some money using BlueStar, although he couldn't provide monthly statements for comparison.

"The power is still delivered by ComEd, and if you have an outage or problem, you still call ComEd and they will take care of it," said Boehm. "But the energy you are using comes from BlueStar at reduced cost, something we are all looking for these days."

BlueStar Energy (www.bluestarenergy.com), an alternative energy provider, launched its new residential program in early May. Five years after Illinois deregulated the energy market, the company actually started in Illinois in 2002 by serving commercial and industrial companies, now totaling about 2,800 statewide. BlueStar is a privately held company based in Chicago with regional offices in Peoria, Washington, D.C., Mt. Laurel, N.J., Lancaster, Penn., Columbus, Ohio, and Troy, Mich.

"We decided to serve the residential marketplace, because we believe the consumers of Illinois deserve a choice, both in their supplier and in the type of energy they wish to use," said BlueStar spokesman Lon Johnson.

BlueStar said it is offering consumers in the Chicago and suburban area a 12-month contract at an estimated 11 percent discount off ComEd's current rate. If consumers want to go green, they could choose renewable energy at an estimated 5 percent discount, Johnson said.

The company said it then would provide a renewal quote to customers not less than 30 days before the end of their agreement, and they have 10 days to reject the offer and return to the utility service with no fees or penalties. If BlueStar doesn't hear back, it will automatically renew the agreement at the price and term offered, Johnson said.

ComEd breaks down the bill into three parts: energy, delivery and taxes. The charge for delivery and taxes are the same to the customer regardless of who they purchase energy from. BlueStar provides its customers a single bill for all three categories and does not mark up the delivery or tax portions, Johnson said.

The Illinois Commerce Commission certifies alternative energy companies, such as BlueStar, that seek to operate in the state. Illinois legislators passed a law to deregulated the market in 1997 to allow competition with alternative suppliers.

BlueStar is the only electricity provider that is actively marketing in the ComEd territory. Another alternative electricity supplier, Integrys, is active in the Ameren residential market downstate, said ICC spokesman Brian Sterling.

"As far as why more companies aren't in the Illinois market, I'd say that the market may not be attractive at this time," Sterling said. "The alternative commercial and industrial markets have many suppliers in Illinois."

Consumers should study the fine print of any contract in order to back up a company's claims, said Jim Chilsen, a spokesman for Citizens Utility Board, a Chicago-based consumer watchdog group.

"If BlueStar can offer a better price, that's great for Illinois," said Chilsen. "But the devil is in the details."