Homes and businesses will always have sufficient supply of gas. Gas utilities have a legal obligation to ensure that homes and businesses are served before industrial customers and power plants. Often, these large customers can use an alternate fuel, such as oil, for a month or more in the winter when gas supplies are tight. Moreover, gas supplies to New England have increased in the last few years from sources in Canada and Trinidad. These new supplies should further reduce supply risk in future winters, even for power plants.
Most utilities are able to enter into long-term contracts for wholesale power at favorable rates.
They pass these savings on to their customers through low standard offer rates. Most competitive suppliers are not yet able to purchase wholesale power at enough of a discount to compete with the utilities' offerings. Suppliers who could do so generally served large industrial customers or aggregations of commercial and institutional customers. For the most part, they could not sustain their offerings, in the face of extraordinary fuel price increases and have withdrawn from serving retail customers. Over the next few years, as fuel prices stabilize and new power plants come on line, wholesale prices are expected to fall.