Bolton Couple Takes On National Grid | Easy Energy has a hard road ahead of it
Margaret Campbell and her husband, Stan Smith, had always wanted to start their own small business. But where many couples might consider a dog grooming salon or a car repair business, they have started an energy company.
“We really are trying to be sort of the corner store for electricity,” Campbell said. “We are trying to be your neighborhood electricity supplier.”
Innovation
The term “energy supplier” may call to mind something considerably bigger than the Bolton home office that is Easy Energy of Massachusetts LLC. And for good reason.
By all accounts, what Campbell and Smith are trying to do — compete with National Grid in buying and selling energy to residential consumers on a small scale — is highly unusual.
But neither of them is a babe in the energy market woods. Between the two of them, they have 60 years of experience working in the field.
So, what does it mean to compete with National Grid? When the Massachusetts electricity market was deregulated more than 10 years ago, customers were freed up to buy energy from a company other than the one that delivered it to their door.
The switch would be simple, and billing would continue to be handled by the distribution company.
Today, many large commercial and industrial users take advantage of the opportunity, but most residential consumers find they can’t.
“The residential and small consumers of electricity have really been left out of the competitive marketplace in the last ten years,” said Brian Murphy of Colonial Power Group in Marlborough.
“There really isn’t enough electricity load per customer to really draw the attention of the bigger electrical suppliers.”
Colonial Power helped Marlborough residents organize a buyers’ pool to bargain with those big suppliers for better rates. Murphy said that, while Easy Energy’s process is different than Colonial’s, it’s a model that could well save customers money.
“They’ve certainly carved out a large challenge for themselves,” he said. “But based on what I’ve seen on their web site they are doing things the way they should.”
Campbell said she’s confident that Easy Energy will be able to keep its prices lower than National Grid’s.
Since the company buys electricity from the same producers as National Grid, she said it can save money in just two ways.
First, it keeps overhead costs low, with bare-bones expenditures like the home office and a web site she designed herself. Second, it buys electricity on a daily basis rather than through long-term contracts.
Murphy said that’s something that National Grid, as a company that delivers power as well as supplying it, is banned from doing.
By law, he said, the distribution companies need to buy six-month contracts ahead of time.
The as-needed purchasing model makes prices uncertain from day to day, but over time it tends to add up to less, Campbell said.
“On a real hot day we will get a spike in price, and we’ll have to pay a higher price for that day,” she said. “But when you take that price and average it out over all that we’ve purchased over the month, then you get a lower price.”
For customers, Easy Energy’s prices are set on a monthly basis.
Campbell said more than 100 residents and small businesses have signed up for the company’s service so far, and it hasn’t even started advertising yet.
By the end of 2009, she said, she hopes to have 2,000 customers on board.
For now, Campbell said, the company is focused solely on National Grid territory, though it may eventually consider competing against other Massachusetts companies. She said Easy Energy will probably not expand beyond the state, and certainly not outside New England.
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