Overview
New York State has one of the most robust retail electric markets in the United States. The movement to restructure the market was chiefly driven by the desire for more competitive pricing, flexible terms of service, increased innovation and more choices for customers.With the opportunity to select their provider of electric commodity service, residential and commercial customers in New York State have exercised their right to choose and have increasingly realized the benefits of competition.

History and Future of Retail Competition in New York
Unlike most other states, New York has implemented retail electric restructuring through a series of administrative decisions by the New York Public Service Commission (PSC). There is no statewide statutory mandate for retail electric restructuring. Since 1997, the PSC has issued orders and approved restructuring settlements that have phased in retail electric competition for all customer segments. However, the design and implementation of electric restructuring has varied among the different electric utilities.Rate structures and actual tariff rates vary by customer service classification and energy usage.

A key driver of market development in New York State has been the market responsive pricing structure and additional savings and tax incentives for customers that enroll with a competitive supplier or energy services company (ESCO). In certain utility service territories, customers that choose to switch to an ESCO may also be eligible for certain credits that offer additional savings benefit.

Consistent with its competitive market outlook, the PSC has approved a regulatory order for mandatory hourly pricing in the state.All large commercial and industrial customers, generally >1000 kW, with the exception of NGrid (>500 kW), will fully transition to hourly pricing by January 1, 2007.This new market development initiative will continue the expansion and progress of retail electric competition in the State.

According to the New York Public Service Commission (PSC), the amount of electricity load that ESCOs are providing in New York State is quite significant and represents a positive market trend.Currently, 74% of the large commercial and industrial, 49% of the small commercial, and 11% of the residential customer electric load is being served by ESCOs.In aggregate, competitive energy services companies are supplying 42% of all electricity used in the State.

Strategic Energy is a registered ESCO in New York State that offers a full array of innovative pricing products to benefit its customers. Strategic Energy actively serving all non-residential customers in the following utility service territories:

• Consolidated Edison Company of New York (ConEd)
• NGrid, formerly Niagara Mohawk Power Corporation (NIMO)
• New York State Electric & Gas Corporation (NYSEG)
• Orange & Rockland Utilities, Inc.
• Central Hudson Gas & Electric Corporation
• Rochester Gas & Electric Corporation

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