CUMBERLAND - Some small businesses and organizations may have received a shock in the last few days when they opened their electric bill.

Due to a change in the classification of Allegheny Power's smaller commercial customers, the bills are increasing about 49 percent from last quarter.

"The (Public Service Commission) has changed that," said Allegheny Power spokesman Todd Meyers. "Small customers who, before, were staying with Allegheny Power are now getting moved from Type 1 to Type 2. For them, this is the first time that shopping for electricity could be beneficial."

The increase will only be a 25 percent difference from an increase put into place this time last year, as summer rates are generally higher than the rest of the year due to energy usage and fuel costs, Meyers said.

This change could affect more than 5,000 businesses in the company's Maryland coverage area, with sizes ranging from as small as dry cleaners or mom-and-pop stores to those as large as a convenience store. Meyers said that others like churches, fire departments and veterans organizations will find themselves in this new category.

Meyers said that he felt this change is part of the process the PSC has been working on to get more energy customers to shop for electricity through different suppliers and increase competition in the market. The new category is not only applying to Allegheny Power customers, but also businesses across the state.

Already, he said 80 percent of the company's industrial category businesses shop for other suppliers, as do more than 50 percent in Type 2 commercial.

Many of these businesses began shopping for their electricity when the rate caps came off in 2005 and electricity to businesses became deregulated.

Some areas, to ease the shopping process and get the best deal possible, do cooperative shopping, as the Garrett County and Allegany County chambers of commerce have done.

"The bottom line is, a business association is a cooperative organization that can buy electricity on the marketplace as a collective rather than as individuals or be completely at the behest of whatever company dominates an area," Charlie Ross, CEO and president of the Garrett chamber, said.

Barb Buehl, president of the Allegany chamber, said the chamber would look into the possibility of once again having an energy co-op.

"Those that joined got a considerable savings," Buehl said. "It's something we may look at again. It will be open for enrollment next year, but some may not want to wait that long. We'll work with (the businesses) to get them some relief. We'll work to see what we can do."

She said that at this point, the complaints have been minimal, but that the effect the new rate will have on them is just hitting many businesses.

For Allegheny Power, Meyers said this will mean that they would not lose customers, as they would continue to distribute the power to the same businesses as before. It would mean that the company would not be purchasing the power and then transferring that cost down to its customers.

He said with increases in businesses shopping for electric providers, Allegheny Power would no longer have the electricity operations "from the top down," and would do the distribution of the power purchased by another company.

Meyers added that when residential electricity becomes deregulated in 2009, the company expects shopping at that level to begin as it already has at the commercial and industrial level. He said that until Jan. 1, the company has been purposely overcharging customers to allow for a gradual buildup to the eventual rate both before and after the first of the new year, rather than an unexpected jump all at once.

Contact Sarah Moses at smoses@times-news.com.

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