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        <td><a href="http://www.nrel.gov/research/ceaa/emaa/mecotib/cover.jpg"><img SRC="../images/covertn.jpg" WIDTH="120" HEIGHT="173" vspace="40" ALIGN="Right"></a> <h1>Green
        Marketing in the Massachusetts Electric Retail Competition Pilot Program </h1>
        <h5>NREL/SP-260-23507<br>
        October 1997<br>
        </h5>
        <h3>Steven M. Rothstein, Environmental Futures, Inc.<br>
        Jeffrey M. Fang, National Renewable Energy Laboratory <br>
        <font face="Arial" size="2">(<em>originally published by PMA OnLine Magazine: 03/98</em>)</font></h3>
        <p><img SRC="../images/logo1.gif" BORDER="0" ALIGN="Left" WIDTH="235" HEIGHT="63"><br clear="all">
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        <table CELLPADDING="2">
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            <td width="125" align="top"><font size="-1"><b>Topical Issues Brief-</b></font></td>
            <td><font size="-1"><i>The Topical Issues Brief series is sponsored by DOE's Office of
            Energy Efficiency and Renewable Energy Office of Utility Technologies</i></font></td>
          </tr>
        </table>
        <p><font size="4">Notice </font></p>
        <p><font size="-1"><i>This report was prepared as an account of work sponsored by an
        agency of the United States government. Neither the United States government nor any
        agency thereof, nor any of their employees, makes any warranty, express or implied, or
        assumes any legal liability or responsibility for the accuracy, completeness, or
        usefulness of any information, apparatus, product, or process disclosed or represents that
        its use would not infringe privately owned rights. Reference herein to any specific
        commercial product, process, or service by trade name, trademark, manufacturer, or
        otherwise does not necessarily constitute or imply its endorsement, recommendation, or
        favoring by the United States government or any agency thereof. The views and opinions of
        authors expressed herein do not necessarily state or reflect those of the United States
        government or any agency thereof.</i></font> </p>
        <p><font size="-1"><i>Printed in the United States of America</i></font> </p>
        <p><font size="-1"><a name="order">Available to DOE and DOE contractors from:</a></font><br>
        </p>
        <blockquote>
          <font size="-1"><p>Office of Scientific and Technical Information (OSTI) <br>
          P.O. Box 62 <br>
          Oak Ridge, TN 37831<br>
          Prices are available by calling (423) 576-8401</font> <br>
          </p>
        </blockquote>
        <p><font size="-1">Available from: </font><br>
        </p>
        <blockquote>
          <font size="-1"><p>National Technical Information Service <br>
          U.S. Department of Commerce <br>
          5285 Port Royal Road <br>
          Springfield, VA 22161 <br>
          (703) 487-4650<br>
          </font></p>
        </blockquote>
        <p><font size="-1">Information pertaining to the pricing codes can be found in the current
        issue of the following publications which are generally available in most libraries:
        Government Reports Announcements and Index (GRA and I); Scientific and Technical Abstract
        Reports (STAR); and publication NTIS-PR-360 available from NTIS at the above address.<br>
        </font></p>
        <p><br>
        </p>
        <h3 class="H3"><a name="toc">Table of Contents</a> </h3>
        <p><a href="green-ma.htm#abstract">Abstract</a> </p>
        <p><a href="green-ma.htm#ack">Acknowledgments</a> </p>
        <p><a href="green-ma.htm#I">I. Introduction</a> </p>
        <p><a href="green-ma.htm#II">II. Green Options</a> </p>
        <blockquote>
          <a href="green-ma.htm#IIa"><p>Development of Green Options</a> <br>
          <a href="green-ma.htm#IIb">Evaluation of Green Option Proposals</a> <br>
          <a href="green-ma.htm#IIc">Prices of Green Options</a> <br>
          <a href="green-ma.htm#IId">Green Verification Process</a> </p>
        </blockquote>
        <p><a href="green-ma.htm#III">III. Green Marketing</a> </p>
        <blockquote>
          <a href="green-ma.htm#IIIa"><p>Working Assets Green Power, Inc.</a> <br>
          <a href="green-ma.htm#IIIb">AllEnergy</a> <br>
          <a href="green-ma.htm#IIIc">Enova Energy</a> <br>
          <a href="green-ma.htm#IIId">Northfield Mountain Energy</a> </p>
        </blockquote>
        <p><a href="green-ma.htm#IV">IV. Assessment</a> </p>
        <blockquote>
          <a href="green-ma.htm#IVa"><p>Generation Resource Mix</a> <br>
          <a href="green-ma.htm#IVb">Other Components of the Green Option</a> <br>
          <a href="green-ma.htm#IVc">Market Shares</a> <br>
          <a href="green-ma.htm#IVd">Green Standards</a> <br>
          <a href="green-ma.htm#IVe">Need for Consumer Education</a> <br>
          <a href="green-ma.htm#IVf">Disclosure and Verification</a> <br>
          <a href="green-ma.htm#IVg">Small-Business Customers</a> </p>
        </blockquote>
        <p><a href="green-ma.htm#V">V. Conclusions and Observations</a> </p>
        <p><a href="green-ma.htm#VI">VI. Notes</a> </p>
        <p><br>
        </p>
        <h4 class="H4">Tables </h4>
        <blockquote>
          <b><p>Table 1</b> - <a href="http://www.nrel.gov/research/ceaa/emaa/mecotib/t1.html">Green
          Options Menu in the MECo Pilot</a> <br>
          <b>Table 2</b> - <a href="green-ma.htm#t2">Market Shares of Supplier Options</a> </p>
        </blockquote>
        <p><br>
        </p>
        <h3 class="H3"><a name="abstract">Abstract</a> </h3>
        <p>With electric industry restructuring initiatives being introduced on the state and
        federal levels, retail access pilot programs serve an important function for examining
        competitive market issues, as well as marketing strategies and customer reactions to
        different power supply options. The experience gained through these pilots provides
        important insights into future power market operations, including the market for green
        power. </p>
        <p>The Massachusetts Electric Company's (MECo's) <i>Choice: New England</i> pilot for
        residential and small-business customers was a voluntary program developed primarily to
        test the billing and metering logistics that distribution companies will need in the
        competitive market. The pilot also offered a preview of program implementation and
        marketing under customer choice. It was the first retail competition pilot to explicitly
        include green power options in program design. </p>
        <p>The MECo pilot's energy suppliers were selected through the issuance of a request for
        proposals (RFP). Respondents were asked to submit bids in one or more of three energy
        supply categories &#151; <i>price, green,</i> and <i>other options</i>. These options were
        developed by the pilot administrator through internal meetings, discussions with state
        officials and other stakeholders, and a review of information from other similar pilots.
        For the green option, the pilot administrator did not establish a green standard. Instead,
        suppliers were allowed to submit offers that promoted environmental stewardship. </p>
        <p>Eligible customers were drawn from four pilot cities: Lawrence, Lynn, Northampton, and
        Worcester. MECo and the pilot program administrator conducted outreach to customers in all
        four cities through a broad range of marketing and consumer education strategies. In
        addition, suppliers conducted their own marketing efforts, including telemarketing,
        literature distribution, and issuance of enrollment ballots to customers. They
        differentiated themselves by offering varying energy prices, financial incentives, and
        assorted services. For example, most of the selected green options offered customers a
        degree of savings but were diverse in their generation profiles and other environmentally
        friendly actions. These included a portfolio of renewable sources, primarily conventional
        hydro; donations to Massachusetts environmental groups; rooftop photovoltaic system
        installation; retirement of air emissions credits; energy efficiency information,
        products, and services; and a raffle for an electric vehicle. </p>
        <p>Customer response to the different green options varied depending on consumer values,
        environmental benefits offered by suppliers, and supplier marketing strategies. Only 3% of
        participating small-business customers selected a green option, whereas 31% of residential
        participants selected a green option. Small-business customers seemed to rank cost savings
        as the most compelling reason to participate in the pilot, whereas residential customers
        were more willing to pursue options that conformed to their beliefs or preferences.
        Residential customers selected a high percentage of power supply portfolios with more
        renewable source content, including at least 20% renewables and no nuclear. Though it
        represents only a fraction of the total retail-customer base, the pilot clearly
        demonstrates that, in a competitive situation, there is interest in a variety of energy
        supply options, including green options. The pilot results also suggest that supplier
        marketing, pricing, customer education, and appropriate disclosure guidelines will be
        instrumental in determining the future standing of green power offerings.</p>
        <p><br>
        </p>
        <p>[ <a href="green-ma.htm#toc">Table of Contents</a> ] </p>
        <p><br>
        </p>
        <h3 class="H3"><a name="ack" class="H3">Acknowledgements</a> </h3>
        <p><i>Green Marketing in the Massachusetts Electric Company Retail Competition Pilot
        Program</i> was prepared by Steven M. Rothstein, Environmental Futures, Inc., and Jeffrey
        M. Fang, National Renewable Energy Laboratory (NREL). It was prepared for NREL, which
        managed the project with funding provided by the Office of Utility Technologies of the
        U.S. Department of Energy (DOE). The authors would like to acknowledge Joe Galdo, DOE, for
        the guidance and financial support he provided to this project. They also wish to thank
        Shana Pyun, Michael Benjamin, and Jonathan Abe of Environmental Futures for their support
        in preparing the document. They further acknowledge AllEnergy, Enova Energy, Northfield
        Mountain Energy, and Working Assets Green Power, Inc., for providing background materials.
        Finally, the authors thank the following reviewers for their comments and suggestions: Joe
        Galdo, DOE; Larry Goldstein, Kevin Porter, and Blair Swezey, NREL; Maureen Hall Gatti,
        Massachusetts Electric Company; and Edward Holt, Ed Holt &amp; Associates, Inc.</p>
        <p><br>
        </p>
        <p>[ <a href="green-ma.htm#toc">Table of Contents</a> ] </p>
        <p><br>
        </p>
        <h3 class="H3"><a name="I">I. Introduction</a> </h3>
        <p>The Massachusetts Electric Company's (MECo's) ongoing pilot program, <i>Choice: New
        England</i>, had two components, one for large high-technology companies, the other for
        residential and small-business customers. The program had several objectives: (1) to allow
        the utility to test logistical and administrative details of retail choice, including
        metering and billing protocols for transitioning smoothly to competition on a statewide
        level; (2)&nbsp;to offer cost savings to customers; and (3)&nbsp;to allow suppliers to
        test aggregation, the capability to deliver power to end-use customers from various
        suppliers, and the New England Power Pool (NEPOOL) settlement process. In other words, the
        pilot served as a learning experience for MECo, its customers, and other players in the
        competitive marketplace, and created a means for customers to have a voice in the
        restructuring process. </p>
        <p>The residential and small-business part of the MECo pilot was the only one of the first
        six retail competition pilot programs that explicitly included green options in its
        program design. It allowed customer choice for up to 10,000 residential and small-business
        customers, or up to 100 million kilowatt-hours (kWh) a year, split equally between
        residential customers and small-business customers. Customers in four cities were eligible
        to participate in the pilot program: Lawrence, Lynn, Northampton, and Worcester. The
        program period was from January through December 1997. </p>
        <p>Energy suppliers for the program were selected by an independent administrator,
        Environmental Futures, Inc. (contracted by MECo), which issued a request for proposals
        (RFP). Six suppliers were selected to participate in the pilot. They were AllEnergy, Enova
        Energy, Northeast Utilities Wholesale (NUW), Northfield Mountain Energy (NME), Wheeled
        Electric Power Company/ Cinergy (WEPCo/Cinergy), and Working Assets Green Power, Inc. Of
        the six, AllEnergy, Enova, NME, and Working Assets offered green options. </p>
        <p>This issues brief covers only the residential and small-business component of the pilot
        and focuses on green marketing. [ <a href="green-ma.htm#fn1">1</a> ]&nbsp; It describes the design and
        marketing of green options and addresses several aspects in the process such as generation
        resource mix, other components of green options, market shares, green standards, need for
        consumer education, need for information disclosure and verification, and targeting
        commercial and industrial customers. It also presents conclusions and observations.</p>
        <p><br>
        </p>
        <p>[ <a href="green-ma.htm#toc">Table of Contents</a> ] </p>
        <p><br>
        </p>
        <h3 class="H3"><a name="II">II. Green Options</a> </h3>
        <p>To offer consumers the broadest possible range of price and service choices, suppliers
        were requested to submit proposals that might include three service options for both
        residential and small-business customers: price, green, and other. The <i>price option</i>
        offered customers the lowest energy price. Suppliers were required to offer a base price
        and to indicate any additional charges or incentives affecting the price. The <i>green
        option</i> provided customers with environmentally beneficial energy choices. The <i>other
        option</i> offered value-added services, such as energy conservation services and
        donations to charitable organizations. The primary intent of the <i>other option</i> was
        to encourage innovation and broaden the spectrum of choices available to the customer.
        Variable-pricing proposals were included under this category. The following describes the
        development of the green options, evaluation of green option proposals, energy prices
        associated with green options, and verification of green option claims. </p>
        <h4 class="H4"><a name="IIa">Development of Green Options</a> </h4>
        <p>Attempts to define &quot;green&quot; energy raise a host of questions, including
        consideration of a green hierarchy, i.e., ranking of various energy sources and services
        from the most to the least &quot;green.&quot; Although renewable energy sources are
        clearly regarded as preferable to nonrenewables, many questions about the relative
        environmental benefits and market feasibility of different energy sources remain. For
        example, small- and large-scale hydro projects and pumped hydro facilities are generally
        not considered equal in terms of environmental impact. However, no uniform ranking system
        has been developed to characterize the greenness of different types of hydro power. The
        green energy concept is evolving rapidly as customers refine their opinions about green
        energy sources and suppliers position themselves to compete in a deregulated and
        environmentally aware market. </p>
        <p>In the absence of a standard national green energy definition, the pilot administrator
        chose not to define green energy for the purpose of the pilot. For the green option,
        suppliers were invited to offer renewable energy sources, energy efficiency and
        demand-side management (DSM) programs, emission reduction guarantees, and donations to
        environmental/community groups, or other services geared toward protection of the
        environment. This approach recognized the limited time frame of the pilot and encouraged
        the broadest possible range of environmentally sensitive proposals, which would be
        evaluated in terms of the merits of the generation profiles and services offered and
        analyses of the validity of environmental claims. This approach also provided pilot
        participants with the opportunity to evaluate the relative benefits of the profiles and
        services offered by selected green suppliers. Rather than creating a green standard, the
        pilot allowed suppliers, through their proposals, and consumers, through their choices, to
        help refine the evolving definition of green options. </p>
        <p>Suppliers proposing green options were required to indicate the generation profile,
        i.e., the percentage breakdown of fuel sources (coal, nuclear, hydro, and renewables) and
        the means for verifying these sources. The RFP also directed suppliers to describe how
        fuel portfolios might change under various scenarios (e.g., peak demand periods or when
        regular sources were undergoing maintenance) and what fuel sources would be used for
        backup power supply. Except for contractual information, all generation portfolio material
        and additional benefits information were to be made available to customers. </p>
        <h4 class="H4"><a name="IIb">Evaluation of Green Option Proposals</a> </h4>
        <p>Consistent with the conceptual descriptions of &quot;green&quot; presented in the RFP,
        criteria for evaluating proposals for the green options category included compliance with
        RFP requirements, validity of supplier information, environmental benefits, and prices. In
        evaluating the &quot;greenness&quot; of competing proposals, a two-tiered hierarchy was
        used. The generation portfolio was the first tier. Other environmentally friendly actions,
        including DSM, donations, and emission reductions were the second tier. Given the short
        time frame between issuance of the RFP and the beginning of the pilot (July
        1996&#150;January 1997), suppliers were unable to bring new renewable sources on line for
        the pilot. Suppliers were thus limited to offering access to existing renewable sources,
        either via direct, dedicated supply or through power purchase contracts. Proposals from
        power generators offering direct access to renewable sources were evaluated more favorably
        than proposals promising renewable power supply through contractual means. Power
        marketers' claims regarding renewable power supply were verified by examining the
        contractual terms. </p>
        <p>Many green option proposals included one&nbsp;or more of the following: energy
        efficiency and DSM initiatives, donations to environmental groups, and emission reduction
        programs. Three of the seven chosen green options included minimal renewable source
        content, but were selected on the strength of their other environmental services and
        benefits. </p>
        <p>There were eight proposals in the residential green category and four were selected.
        Similarly, there were eight proposals in the small-business green category and three were
        selected. Information on winning green suppliers is presented in <a href="http://www.nrel.gov/research/ceaa/emaa/mecotib/t1.html" name="t1"><b>Table 1</b></a>.
        </p>
        <p>Factors that distinguished the winning green proposals included competitive pricing;
        well-defined, comprehensive services; and valid generation profiles containing
        sufficiently high renewable-source content. Several proposals for the green option
        included a combination of these benefits, so the scope of services offered and
        substantiation of environmental benefits became particularly important evaluation
        criteria. </p>
        <p>The primary reasons for rejecting green option proposals were high energy prices,
        operational limitations, and questionable nature of environmental claims. Because of the
        relatively short span between RFP issuance and the beginning of the pilot, two bidders
        offering new sources of renewable power were unable to guarantee that power could be
        brought reliably on line to the NEPOOL system in time for the January start date. These
        proposals were rejected. </p>
        <h4 class="H4"><a name="IIc">Prices of Green Options</a></h4>
        <p>Not all proposed green options included prices that would allow customers to save money
        through participation in the pilot. Because creating customer cost savings was one of
        MECo's fundamental goals in this pilot, and because the bids submitted in other options
        are quite price-competitive, green proposals that did not provide the potential for cost
        savings in terms of their base-price offering were rejected. [ <a href="green-ma.htm#fn2">2</a>
        ]&nbsp; All of the selected options (price, green, and other) offered cost savings for the
        average customer when compared to existing MECo rates. </p>
        <p>Base prices for the generation portion of the bill offered by the selected suppliers in
        the residential-green and small-business-green categories ranged from $0.0250/kWh to
        $0.0341/kWh, or $0.0200/kWh to $0.0341/kWh on an all-costs comparative basis (see <a href="http://www.nrel.gov/research/ceaa/emaa/mecotib/t1.html">Table 1</a>). On average,
        base prices of green options presented to customers in the pilot program were $0.0301/kWh,
        as compared to $0.0280/kWh for other options and $0.0256/kWh for price options. </p>
        <p>Although green option prices generally promised less savings than<i> </i>bids for the
        price and other options, two winning suppliers offered prices under the green option that
        would have been competitive in the price option category, on either the base-price or the
        comparative-price basis. Based on the limited scope of the pilot and its underlying goals,
        suppliers clearly recognized that price was an important component in designing a
        successful proposal and in attracting pilot participants. For this and other reasons
        (e.g., lack of supplier financial information), it is unclear whether supplier costs for
        the two low-priced green options were comparable to the costs of price and other options,
        or if artificially low prices were offered for the purpose of this pilot. However, it is
        worth noting that NME relies exclusively (100%) on existing hydro resources, the cost of
        which is generally lower than other generation sources. </p>
        <h4 class="H4"><a name="IId">Green Verification Process</a></h4>
        <p>In developing a green verification process, the pilot program administrator was
        primarily interested in maintaining the integrity of the proposals submitted. Because of
        the use of an independent pilot administrator and an RFP screening process, the structure
        of the MECo pilot was better suited to holding marketers accountable for their green
        claims. </p>
        <p>Suppliers offering benefits and services under green options were required to confirm
        the status of their programs in writing on a quarterly basis to verify that all of the
        benefits/donations occurred as promised. As mentioned above, these benefits ranged from
        donations to environmental groups to DSM efforts, including a raffle for an electric
        vehicle and the installation of photovoltaic (PV) panels in pilot cities. In the absence
        of a national standard for green power, verification of renewable source content was to be
        provided with a written statement of dedicated capacity and backup capacity, including
        reference to unit entitlements and/or power purchase contract terms and conditions. </p>
        <p>The inclusion of hydro power as a renewable power source prompted investigation of
        specific information regarding the type of dedicated hydro sources, e.g., small-scale
        hydro, large hydro facilities, and pumped-storage hydro. NME claimed 100% hydro as the
        generation profile for their residential and small-business green options, using various
        hydroelectric plants within the Northeast Utilities System. A condition for accepting
        these green options into the pilot was NME's verification specifying that no
        pumped-storage hydro plants would be dedicated to NME customers in this pilot program.
        Through conversations with NME officials and through the verification updates, the pilot
        administrator was able to confirm that the hydro facilities used were not pumped-storage
        hydro facilities. </p>
        <p>Consistent with the pilot's intent to ensure that all green claims for the pilot were
        reviewed and verified, the pilot administrator reviewed contract language to verify the
        claim that &quot;no coal, nuclear, nor Hydro-Quebec&quot; generation would be used in
        providing power to pilot customers before accepting Working Assets' green power into the
        pilot as a green option.</p>
        <p><br>
        </p>
        <p>[ <a href="green-ma.htm#toc">Table of Contents</a> ] </p>
        <p><br>
        </p>
        <h3 class="H3"><a name="III">III. Green Marketing</a></h3>
        <p>The MECo pilot featured two distinct components in its marketing<b>/</b>outreach
        campaign. The first was a general promotional effort implemented by MECo and the pilot
        administrator. The second was the focused enrollment effort by the utility, the
        administrator, and the six participating power suppliers. The following discussion
        highlights the marketing of green options in the supplier marketing stage. [ <a href="green-ma.htm#fn3">3</a> ] </p>
        <p>The broad outline of &quot;green&quot; provided in the RFP resulted in a wide range of
        service offerings and marketing efforts by the four selected green option suppliers (see <a href="http://www.nrel.gov/research/ceaa/emaa/mecotib/t1.html">Table 1</a>). The selected
        green options were distinguished from the other options by their valid, environmentally
        sensitive generation profiles or distinctive services, including energy efficiency
        programs, retirement of emission credits, and donations to environmental groups and
        projects. The&nbsp;&quot;green&quot; price range, generation profiles, and services varied
        considerably among suppliers. Comparative residential and small-business prices offered by
        Enova Energy and NME were among the most competitive in the pilot. NUW and Working Assets
        highlighted their generation profiles. In contrast, Enova and AllEnergy stressed the
        environmental services of their offers such as retirement of emission credits,
        installation of PV panels in community buildings, and donations to environmental projects.
        </p>
        <h4 class="H4"><a name="IIIa">Working Assets Green Power, Inc.</a></h4>
        <p>With 33%&#150;55% of the power in its generation profile from renewables (35%&#150;50%
        natural gas, 0%&#150;5% oil) and a commitment to donating 1% of its revenues from the
        pilot to Massachusetts environmental groups, Working Assets offered a unique definition of
        green. Its base price and comparative prices of $0.0335 and $0.0298 were higher than most
        of the other competitive green option prices (see <a href="http://www.nrel.gov/research/ceaa/emaa/mecotib/t1.html">Table 1</a>), which created
        a need for aggressive marketing efforts. The lower comparative price was due to the
        inclusion of the $25 bonus gift certificate for energy efficiency products after six
        months. Working Assets offered only a residential green option, whereas other green option
        suppliers offered both residential and small-business green options. </p>
        <p>Through the MECo ballot, telemarketing, and direct-mail pieces, Working Assets marketed
        itself as a &quot;nuclear-free, coal-free, and Hydro-Quebec-free&quot; power source. This
        marketing theme aimed to capitalize on the public's concern regarding the potential
        environmental impacts of nuclear power and coal-fired generation, as well as the
        controversy surrounding the impacts of large-scale hydro development by Hydro-Quebec. It
        was also not inconsistent with the criteria adopted for this pilot. However, because no
        new renewable generation was involved and no net improvement to the environment in the
        short run was claimed, some had criticized Working Assets as marketing social
        responsibility without substance. [ <a href="green-ma.htm#fn4">4</a> ] </p>
        <p>Working Assets was the only pilot program supplier with an existing, albeit small,
        customer base, gained through its services as a long-distance phone service provider.
        Working Assets targeted its existing long-distance customers in marketing its green option
        and gave enrolled customers free ice cream or long-distance services. (Non-Working Assets
        long-distance customers were encouraged to sign up for this service as well.) [ <a href="green-ma.htm#fn5">5</a> ] </p>
        <p>Working Assets found success by concentrating telemarketing, direct mail, and other
        marketing efforts in the city of Northampton. This community is the most rural of the four
        pilot cities with a density of 850 people per square mile. It also has the largest
        percentage of registered voters (51%), the largest percentage of residents having a
        bachelor's degree or higher (28.8%), and the highest median annual household income, at
        $31,097. While the other pilot cities have developed primarily from urban manufacturing
        and commercial centers, the city of Northampton is known for its surrounding natural and
        educational resources, institutional base (three hospitals and Smith College), and local
        commercial sector. The city is also known for its strong municipal programs in education,
        public safety, recreation, and energy conservation. [ <a href="green-ma.htm#fn6">6</a> ] </p>
        <h4 class="H4"><a name="IIIb">AllEnergy</a></h4>
        <p>AllEnergy's green option used a three-tiered pricing approach, allowing residential and
        small-business customers to support different levels of environmental services according
        to the energy price paid. For a price premium of either $0.002 or $0.004 per kWh,
        AllEnergy offered a greater per-customer commitment to retiring sulfur dioxide emissions
        credits and installing PV panels in pilot cities. The incremental environmental benefits
        were larger for small-business customers because of the higher per-customer average energy
        usage. Relative to NME and Working Assets, which offered portfolios with substantial
        renewables content, AllEnergy's generation profile contained only 6% renewable sources.
        AllEnergy's lowest price also exceeded the most competitive residential green offer (NME's
        $0.0200 comparative price) by more than $0.010&nbsp;per kWh, or about 50%, and exceeded
        the most competitive small-business green prices by approximately 40%. In addition,
        although it appears that AllEnergy based its green option design on the recent trend in
        utility green pricing programs that allow various options to suit customers' preferences
        and ability to pay for different levels of&nbsp;green or renewable energy content, it is a
        relatively complex design compared with other green or price options. </p>
        <p>Based in Waltham, Massachusetts, AllEnergy emphasized its local roots and commitment to
        the local environment in promoting its green and other options. A detailed brochure mailed
        selectively to potential pilot participants described a &quot;Locally Committed ...
        Nationally Recognized ... Environmentally Responsible&quot; company. Like Working Assets,
        AllEnergy focused its green marketing efforts in Northampton. AllEnergy also marketed at
        mini-expos during the enrollment period. </p>
        <h4 class="H4"><a name="IIIc">Enova Energy</a></h4>
        <p>Like AllEnergy, Enova's generation profile for its green option included a low level of
        renewable-source content (approximately 8%). However, Enova's residential and
        small-business green prices were very competitive&#151;at a comparative level of $0.0221
        and $0.0230 per kWh, they were marginally higher than NME's comparative green prices, and
        among the most competitive prices in the pilot. </p>
        <p>Enova distinguished itself by providing additional services. It provided customers with
        an array of environmental literature, such as conservation tips, a home environmental
        survey, a &quot;Conserving Our World&quot; calendar; an &quot;Earth Saver&quot; kit
        containing a reusable grocery bag, light switch decals, a refrigerator thermometer, and
        other items; and a camera allowing customers to document their environmental initiatives
        and qualify for additional rewards and services. Small-business customers were offered
        promotional services, and received a &quot;A Clean Environment is My Business&quot; decal.
        Enova also offered to match donations to local environmental projects, as much as $12 per
        customer for the duration of the pilot with a maximum of $20,000. Finally, Enova enticed
        residential and small-business green option customers with a raffle for an electric
        vehicle. </p>
        <p>Enova used newspaper ads and direct mail to promote its green option. An ad displaying
        a smiling planet Earth and exhorting customers to &quot;Choose Green&quot; appeared in
        local papers. Based on authorized mailing information provided by MECo, Enova distributed
        an &quot;Energy Matters&quot; brochure to a limited group of potential customers. In
        addition to information about the MECo pilot, the brochure featured an announcement about
        Enova's recently opened local office and a directory of environmental information sources.
        Enova also mailed price/green options ballots, a brief question-and-answer document, and
        form letters to targeted potential residential and small-business customers. </p>
        <h4 class="H4"><a name="IIId">Northfield Mountain Energy</a></h4>
        <p>NME provided consumers with &quot;3 great reasons to choose&quot; their option:
        (1)&nbsp;Save Money, (2)&nbsp;Conserve Energy, and (3)&nbsp;Protect Your Environment.
        Because of its locally recognized brand name, NME's marketing approach stressed its local
        roots and offered a diversity of benefits with the option. The base price offered to
        residential customers was a competitive $0.0260/kWh, and its generation portfolio was 100%
        hydro power. NME's option included additional environmentally oriented benefits to
        residential customers such as a free home energy survey to help identify conservation
        measures; an&nbsp;energy efficiency home products catalog; and free&nbsp;energy-saving
        products, including a showerhead, faucet flip aerator, and a refrigerator vacuum brush.
        Including the value of the additional services provided, the comparative price for the
        average NME residential customer was $0.0200 per kWh, making it the lowest comparative
        price green option and second lowest comparative price offered to residential customers in
        the entire pilot. </p>
        <p>In addition to the lowest green option base prices offered to small-business customers
        with G1 and G2 rate schedules,&nbsp;[ <a href="green-ma.htm#fn7">7</a> ]&nbsp; $0.0275 and $0.0255 per
        kWh, respectively, the NME small-business green option offered possible additional savings
        of $0.0025 per kWh. The option included a free lighting audit and energy-saving guidebook,
        complemented by a lighting retrofit kit offering energy efficiency lighting at competitive
        prices. The&nbsp; small businesses were also offered community recognition in the form of
        free advertising and a plaque publicizing their environmentally conscious electricity
        selection. </p>
        <p>Rounding out the benefits offered under its green options, NME committed to donating a
        portion of its revenue to local environmental projects and to retiring sulfur dioxide (SO<sub>2</sub>)
        allowances on behalf of the American Lung Association for both residential and
        small-business customers. </p>
        <p>NME sent its marketing brochure to interested pilot customers, placed print
        advertisements in local newspapers presenting the three great reasons to choose NME, and
        marketed its green options at area trade shows.</p>
        <p><br>
        </p>
        <p>[ <a href="green-ma.htm#toc">Table of Contents</a> ] </p>
        <p><br>
        </p>
        <h3 class="H3"><a name="IV">IV. Assessment</a></h3>
        <p>Given the above descriptions, several aspects of green options and green marketing
        deserve further discussion. They involve generation resource mix, other components of
        green options, market shares, green standards, the need for consumer education and
        information disclosure and verification, and commercial and industrial customers. </p>
        <h4 class="H4"><a name="IVa">Generation Resource Mix</a></h4>
        <p>Because of the design of the pilot program, the generation resource mixes of the green
        option suppliers were shown clearly in the literature provided to the participants.
        However, resource mix information was not provided for the &quot;price&quot; and
        &quot;other&quot; options. As shown in <a href="http://www.nrel.gov/research/ceaa/emaa/mecotib/t1.html">Table 1</a>, the share of
        renewable energy ranged from as low as 8% to 100%. NME and Working Assets had higher
        renewable energy content at 100% and 35%&#150;55%, respectively. Renewable energy was
        primarily existing hydro resources. Except for potential installation of PV panels in
        community buildings from the AllEnergy green option, there was no addition of new
        renewable generation. To a large extent, this was due to the short timeframe between the
        RFP and the start of the pilot; there was simply not sufficient time to develop new
        renewable generation and bring it on line to supply customers who might sign up for the
        option. As mentioned above, two proposals involving new renewable generation were not
        accepted into the pilot for this reason. Fossil fuels such as coal, gas, and oil, and
        nuclear fuel, were also included in the resource portfolios. Nuclear energy accounted for
        57% for Enova Energy and 14% for AllEnergy. Enova, AllEnergy, and Working Assets had about
        one-third of their generation resources in fossil-fueled power plants. </p>
        <h4 class="H4"><a name="IVb">Other Components of the Green Option</a></h4>
        <p>In addition to renewable energy, the green options offered by suppliers in the
        generation resource mix included energy efficiency information, products, and services;
        retirement of SO<sub>2</sub> emission credits; installation of PV panels on community
        buildings; donations to environmental organizations, projects, and community groups; and
        other inducements such as a raffle for an electric vehicle. Although these components were
        environmentally friendly in some sense, except for the installation of PV panels at
        community buildings, there were no net additions to new renewables generation in the short
        term. Similarly, except for the installation of PV panels, there were no net improvements
        to the environment through the substitution of new renewable generation for existing power
        plants with high emission rates. Customers had mixed reactions to these other benefits or
        actions. Although attractive to some consumers, such benefits alone without the inclusion
        of a green portfolio may have resulted in some increased consumer skepticism regarding the
        actual environmental benefit of the specific option. </p>
        <h4 class="H4"><a name="IVc">Market Shares</a></h4>
        <p>Overall, 31% of residential participants selected green options, whereas only 3% of
        small-business participants chose green options. These results should be viewed with the
        following qualifications in mind. First, although the small-business portion of the pilot
        was fully subscribed, the residential customer portion was only 60% subscribed in terms of
        allocated loads. This latter result shows that the residential interest, trust, or
        awareness in the pilot may be limited and that those who did sign up may have been more
        motivated by green options. Second, because cost savings was the primary concern of
        businesses, a clear majority of small-business participants went with the most
        advantageous price options. In the residential sector, cost savings was still the most
        important consideration, but concern about the environment became more prominent. As shown
        in <a href="green-ma.htm#t2"><b>Table 2</b></a>, the largest three shares in the small-business sector
        are all price options: NUW&#151;price, 70%; WEPCO/Cinergy&#151;price, 17%;
        Enova&#151;price, 9%. The NME green option is fourth with approximately 3%. Similarly, in
        the residential sector, price options occupy the number 1 and 2 spots: Enova&#151;price,
        43%; NUW&#151;price, 21%. Working Assets green option and NME green option are&nbsp;number
        3 and number&nbsp;4 in market shares, at 16% and 10%, respectively. Third, as mentioned
        above, Working Assets successfully targeted the residential customers in Northampton.
        Because Working Assets did not offer a green option for small-business customers, the
        results would tend to bias toward the residential participation rate. Finally, a related
        aspect is that the green options for the small- business customers were not as intensively
        marketed as those for the residential customers. </p>
        <p>The relative popularity of the Working Assets green option, the one with the most
        expensive residential green offerings, is a notable exception to the customer preference
        for low price. It also suggests that consumers are willing to pay a price premium for
        power they believe to be environmentally friendly. The AllEnergy green option, with its
        high comparative price and its relatively complex three-tiered options, was able to
        achieve only a 1% market share, compared to Working Assets' 16%. </p>
        <h4 class="H4"><a name="IVd">Green Standards</a></h4>
        <p>As noted above, the design of the MECo pilot did not set a green standard. This is
        related to the definition of the term &quot;green,&quot; which is being debated in
        Massachusetts and across the United States. For example, recent legislation proposed by
        the Massachusetts Joint Special Committee on Electric Industry Restructuring offered a
        standard for green power. In Section 8. B. (I). the legislation states &quot;no generation
        company or supplier may advertise their power as &quot;green&quot; power, or any other
        term connoting an environmentally beneficial portfolio, unless such portfolio includes
        energy from renewable source in the amount of at least 20% and does not include nuclear
        power.&quot;&nbsp;&nbsp;[ <a href="green-ma.htm#fn8">8</a>&nbsp;]&nbsp; Based on such a standard, 87%
        of the customers in the MECo pilot selecting a green option selected an option that would
        qualify as green. It appears that Working Assets' marketing played a significant role in
        this outcome. One customer indicated that a primary reason for selecting the firm was its
        proven history of&nbsp;commitment to the environment (through Working Assets Long
        Distance) and its developing commitment to renewable power. In addition, although no
        renewable standard was set in the pilot, customer selections of service providers show a
        strong leaning toward firms with relatively high renewables content in their generation
        portfolios, such as NME (100% high hydro) and Working Assets (30%&#150;45% hydro and
        3%&#150;10% other renewables). </p>
        <p><br>
        </p>
        <div align="center"><center><table BORDER="1" CELLSPACING="2" BORDERCOLOR="#000000" CELLPADDING="8" WIDTH="100%">
          <caption><b><a name="t2">Table 2:</a> Market Shares of Supplier Options (%)</b></caption>
          <tr>
            <td WIDTH="36%" VALIGN="TOP"><p ALIGN="CENTER">Supplier Options</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">Residential Customers</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">Small Businesses</td>
          </tr>
          <tr>
            <td WIDTH="36%" VALIGN="TOP"><p ALIGN="CENTER">Enova - Price</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">43</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">9</td>
          </tr>
          <tr>
            <td WIDTH="36%" VALIGN="TOP"><p ALIGN="CENTER">NUW - Price</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">21</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">70</td>
          </tr>
          <tr>
            <td WIDTH="36%" VALIGN="TOP"><p ALIGN="CENTER">Working Assets - Green</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">16</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">(a)</td>
          </tr>
          <tr>
            <td WIDTH="36%" VALIGN="TOP"><p ALIGN="CENTER">NME - Green</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">10</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">3</td>
          </tr>
          <tr>
            <td WIDTH="36%" VALIGN="TOP"><p ALIGN="CENTER">WEPCO/Cinergy - Price</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">3</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">17</td>
          </tr>
          <tr>
            <td WIDTH="36%" VALIGN="TOP"><p ALIGN="CENTER">Enova - Green</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">3</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">0</td>
          </tr>
          <tr>
            <td WIDTH="36%" VALIGN="TOP"><p ALIGN="CENTER">AllEnergy - Other</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">3</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">0</td>
          </tr>
          <tr>
            <td WIDTH="36%" VALIGN="TOP"><p ALIGN="CENTER">AllEnergy - Green</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">1</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">0</td>
          </tr>
          <tr>
            <td WIDTH="36%" VALIGN="TOP"><p ALIGN="CENTER">WEPCO/Cinergy-Other</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">0</td>
            <td WIDTH="32%" VALIGN="TOP"><p ALIGN="CENTER">0</td>
          </tr>
        </table>
        </center></div><p align="center">(a) Working Assets did not offer a green option for small
        business customers. </p>
        <p><br>
        </p>
        <h4 class="H4"><a name="IVe">Need for Consumer Education</a></h4>
        <p>The concepts of competition in the electric industry and the unbundling of bills can
        cause initial confusion to customers who have been purchasing bundled electricity from a
        regulated utility. A substantial portion of customers had never considered the
        environmental impact associated with the generation of electricity until presented with
        the choice of their electricity supplier. Many of the customers who called the customer
        service line often asked the question: &quot;Why would anyone select anything but the
        lowest price?&quot; In addition, many callers did not understand the benefits offered by
        green options. They did not know the environmental consequences of electricity generation
        and had little familiarity with renewable energy. On the other hand, some customers asked
        more specific questions regarding the sources of generation or the companies'
        environmental records. The environmentally aware customers were concerned with the quality
        of the green options. They wanted to know how the green portfolio would be verified, and
        also wanted their provider of renewable energy to have a consistent and complementary
        environmental record. In short, many consumers were environmentally unaware regarding
        power supply options, whereas some were environmentally educated. Thus, there is a need
        for consumer education to inform those who are not familiar with the nature of electric
        industry deregulation and the environmental benefits of renewable energy. </p>
        <h4 class="H4"><a name="IVf">Disclosure and Verification </a></h4>
        <p>In the MECo pilot, a booklet containing comparative information concerning the various
        offers and a card for participants to mark their choice of suppliers (&quot;the
        ballot&quot;) were made available to eligible customers.&nbsp;[&nbsp;<a href="green-ma.htm#fn9">9</a>&nbsp;]&nbsp;
        The generation resource portfolios of suppliers offering green options were clearly shown,
        and the comparative prices of each option were computed by adding the values of all other
        incentives, bonuses, or penalties to the base prices. This made comparison easy. The
        ballot was extremely useful in satisfying the customers' need for information and
        providing answers to many of the often-asked questions. In other pilots and in full retail
        competition, it will be necessary to have similar tools for disclosing such relevant
        information to facilitate customer decision making. In addition, the information disclosed
        should be accurate and timely. Thus, there is also a need to somehow verify the accuracy
        of the information provided by the suppliers. </p>
        <h4 class="H4"><a name="IVg">Small-Business Customers</a></h4>
        <p>As noted above, most small-business customers participating in the pilot program went
        with the price option. Even those who went with green options selected NME, the utility
        with the least expensive green option and the option with the lowest comparative price for
        G2 customers. This suggests that, for small-business customers, the price factor will
        still play a role in customer selection of green options. Nevertheless, some of these
        customers felt strongly about selecting a green option. For example, Andrew Chambers,
        owner of the Pizza Factory in Northampton, selected NME. He described himself as &quot;an
        old nuclear protester&quot; and indicated that the pilot was a chance to get &quot;a
        little bit of choice about where my electricity is generated.&quot; Despite paying more
        than he would with some other options, Mr.&nbsp;Chambers said, &quot;You aren't talking
        about more than 20 dollars a month either way. For me it was a chance to make a
        statement.&quot;&nbsp;[&nbsp;<a href="green-ma.htm#fn10">10</a>&nbsp;]</p>
        <p><br>
        </p>
        <p>[ <a href="green-ma.htm#toc">Table of Contents</a> ] </p>
        <p><br>
        </p>
        <h3 class="H3"><a name="V">V. Conclusions and Observations</a></h3>
        <p>The MECo retail access pilot program demonstrated that the pending restructuring of the
        U.S. electric power industry will transform the electric market through a more dynamic
        interaction of consumer demands and supplier marketing. It has shown that, with foresight,
        customers can be provided with relevant information for making apples-to-apples
        comparisons among different service options offered by multiple providers. </p>
        <p>As the first retail competition pilot program to involve green marketing explicitly in
        its program design, the MECo pilot also proved that a significant segment of electric
        customers place a value on environmental stewardship and, when given an option, will sign
        up for and even pay comparatively more for energy services derived from environmentally
        friendly sources. </p>
        <p>Despite the limited scope and controlled structure of the pilot, some important
        insights were gained with respect to education, targeted marketing, information
        disclosure, verification of supplier claims, green power, and targeting of larger
        commercial and industrial customers.<ul>
          <li><i>Consumer education is necessary to enable customers to make informed choices.</i> </li>
        </ul>
        <p>Under retail competition, all customers will be able to choose their electricity
        suppliers. To enable customers to make educated choices and realize the benefits of
        electric deregulation, they need to be educated on the nature of deregulation; its
        implications for individual consumers; how cost savings will be realized; who the
        suppliers are and what they are offering; as well as many other details. The education
        effort should also provide all customers with information on environmental impacts
        associated with electricity. Further, because many consumers lack an understanding of
        renewable energy, information on renewables would also be useful. In short, a smooth
        transition to a competitive electric market depends greatly on consumer education. Without
        effective educational efforts, many consumers will not understand the benefits of
        deregulation and will be reluctant to exercise their choice of service providers.<ul>
          <li><i>Targeted marketing can increase customer participation.</i> </li>
        </ul>
        <p>Both MECo and the pilot program administrator conducted extensive marketing campaigns
        to promote general awareness of the pilot program. </p>
        <p>In addition, service providers conducted intensive marketing efforts. Although the
        small-business portion of the pilot reached full enrollment, the residential portion was
        not fully subscribed. This suggests that greater marketing and education efforts need to
        be targeted toward residential customers. In part, as a result of targeted marketing by
        Working Assets and other suppliers, there was a higher level of consumer participation,
        specifically in the green options, among residents of Northampton, the wealthiest and most
        educated of the four pilot communities. This suggests that targeting education and
        marketing efforts at particular demographic groups or communities can increase pilot
        program participation. It also supports the notion that green customers and customers
        willing to choose an alternate supplier will come from wealthier, well-educated
        communities. These results suggest that a broad consumer education initiative is likely
        required if customer participation is to reach significant levels.<ul>
          <li><i>Information disclosure will help customers make decisions.</i> </li>
        </ul>
        <p>Customer reaction to the pilot suggested that the MECo ballot, with its menu of
        options, was a useful consumer education and information disclosure tool. It provided
        basic, unbiased, and comparative information on each of the options. It allowed customers
        to make apples-to-apples comparisons among the various options offered by suppliers. As a
        result, customers in the MECo pilot had a good understanding of the choices they had to
        make. </p>
        <p>When full retail competition is implemented, however, it may not be possible to prepare
        such a ballot. For this reason, a standard disclosure mechanism should be developed. As
        suggested by participating customers, disclosed information should include not only the
        generation resource portfolios and base and comparative prices, but also other
        environmental information, such as emission levels of different types of power plants and
        detailed generation profiles for all options, as well as important contract terms. <ul>
          <li><i>Verification of the disclosed information should be ongoing to ensure that it is
            accurate and true.</i> </li>
        </ul>
        <p>Information disclosure is only valuable to the marketplace if it is accurate and
        verifiable. Questions from pilot customers indicated that some consumers are interested in
        how information provided by service providers can be tracked and verified. The limited
        nature of the pilot program allowed the pilot program administrator to verify the claims
        of service providers concerning generation portfolio and donations and to track them
        through contracts or receipts. However, in a larger retail market or under full retail
        competition, an approach that relies on paper trails may be inefficient and inaccurate.
        Whatever tracking methods are implemented, it is important to recognize that consumers are
        interested in this information and will want assurance that the verification procedures
        are accurate and credible. <ul>
          <li><i>The green power concept appeals to a diversity of customer interests.</i> </li>
        </ul>
        <p>The MECo pilot did not define green power per se, but instead allowed service providers
        flexibility in the design of green power options. One result of this open-definition
        approach is that, although many think of green power as having significant renewable
        energy content, suppliers offered a number of non-renewables-based alternatives in their
        green service options, such as energy efficiency programs, retirement of emission credits,
        and donations to environmental groups. For energy efficiency programs, a kWh conserved
        provides the same emissions reduction benefit as a kWh generated by renewables. Energy
        efficiency services and programs not only reduce the need for electricity produced by
        fossil fuels but also save end users money on their electric bills. Retirement of emission
        credits will also reduce the total amount of emissions from power plants, and donations to
        environmental groups can advance many different environmental causes. </p>
        <p>Nevertheless, questions arose concerning the open-definition approach to green power.
        Some questioned the substance of some of the green-marketing approaches and themes. Others
        stressed the fact that no new renewable generation resulted from the green-power
        offerings. Where green power is broadly defined to include options other than renewable
        energy, the potential benefits of green marketing for renewables will not be as great as
        would be expected with a renewables-only definition. However, the diversity of green
        options offered by a broader definition may attract and serve to educate a larger market
        segment inclusive of not only stereotypical green customers, but also customers who might
        be interested in other environmentally friendly actions such as energy efficiency
        measures. Consequently, the broader definition of green may better serve to heighten
        environmental awareness and increase the diversity of customers interested in the green
        options with significant renewable content and energy conservation programs. </p>
        <p>The MECO pilot demonstrated that the concept of green power appeals to a diversity of
        customer interests. Each green choice made in the pilot program contributed in some
        fashion to promoting environmental stewardship in either power generation or consumption. <ul>
          <li><i>Larger commercial and industrial customers should be targeted to increase the demand
            for green power.</i> </li>
        </ul>
        <p>Although some level of residential participation in the future green market appears
        ensured, individual residential customers consume a relatively small amount of
        electricity. Efforts to educate and market green power to residential customers need to be
        complemented by initiatives and options that attract larger commercial and industrial
        customers.</p>
        <p><br>
        </p>
        <p>[ <a href="green-ma.htm#toc">Table of Contents</a> ] </p>
        <p><br>
        </p>
        <h3 class="H3"><a name="VI">VI. Notes</a></h3>
        <p><a name="fn1">1.</a> For a detailed description of the residential and small-business
        pilot, see Environmental Futures, Inc.'s, <i>The Massachusetts Electric Company Choice,
        New England Pilot: A Focus on Green Marketing</i>, prepared for NREL, August 1997.
        Available at <a href="http://www.eren.doe.gov/greenpower/meco">http://www.eren.doe.gov/greenpower/</a>.
        For descriptions of the other part of the MECo pilot program involving large
        high-technology companies, see Edison Electric Institute's <i>Retail Pilot Programs: the
        First Six</i>, Washington, D.C. 1997, Chapter 5, pp. 61-75. This latter source also
        provides details of the residential and small-business pilot that are not focused on in
        this brief or the Environmental Futures, Inc.'s report noted above. </p>
        <p><a name="fn2">2.</a> Questions have been raised as to whether this criterion is in
        conflict with the common notion that consumers are willing to pay a price premium for
        renewable power, as exemplified by the many green-pricing programs being implemented by
        utilities. In other words, some customers may still be willing to pay the price premium
        even if it is higher than their existing rates if they can be sure that they are
        contributing to the development of new renewables generation. However, for the purpose of
        the MECo pilot, the utility wanted to ensure that there was potential customer cost
        savings involved. That was the reason for adopting the criterion. </p>
        <p><a name="fn3">3.</a> For a discussion of the general awareness campaign and supplier
        marketing, see the report by Environmental Futures, Inc., cited in <a href="green-ma.htm#fn1">Note 1</a>
        above. </p>
        <p><a name="fn4">4.</a> For a discussion on this point, as well as Working Assets' defense
        of its marketing approach, see Holt, E., and J.M. Fang<i>, <a href="http://www.nrel.gov/research/ceaa/emaa/nhtib">The New Hampshire Retail Competition
        Pilot Program and the Role of Green Marketing</a></i>, NREL/TP-460-23446, November 1997. </p>
        <p><a name="fn5">5.</a> The incentives of free ice cream or free long-distance services
        were added after the information ballot was prepared and, hence, were not included in the
        computation of the comparative price for Working Assets. </p>
        <p><a name="fn6">6.</a> Executive Office of Communities and Development. <i>Northampton:
        Hampshire County, A&nbsp;Community Profile</i>. William Francis Galvin, Secretary of the
        Commonwealth; 1995. For a comparison of the demographic information concerning population,
        population density, percentages of registered voters and with bachelor's degree or higher,
        and median annual household income for the four pilot cities, see Environmental Futures,
        Inc., <i>op. cit.</i> Table 4. </p>
        <p><a name="fn7">7.</a> The G1 rate schedule is for small commercial and industrial
        customers not exceeding 10,000 kWh per month or 200&nbsp;kW of demand. The G2 rate
        schedule is for small commercial and industrial customers exceeding 10,000 kWh but not
        exceeding 200 kW of demand. </p>
        <p><a name="fn8">8.</a> The Joint Committee on Electric Utility Restructuring of the
        Massachusetts Legislature. <i>An Act to Promote Competition in the Electric Utility
        Industry.</i> HR 1744, March 20, 1997. </p>
        <p><a name="fn9">9.</a> Massachusetts Electric Company, <i>Be Among the First! Choose Your
        Electricity Supplier with Massachusetts Electric's Choice: New England Pilot, and Have the
        Opportunity to Save Money</i>. Participation Information. October, 1996. </p>
        <p><a name="fn10">10.</a> Ackerman, Terry. &quot;Hints of Future for Utilities,&quot; <i>Boston
        Globe</i>, January 9, 1997. p. D1.</p>
        <p><br>
        </p>
        <p>[ <a href="green-ma.htm#toc">Table of Contents</a> ] </p>
        <p>&nbsp; </p>
        <p>&nbsp; </p>
        <h3 class="H3">Topical Issues Briefs Previously Published by the National Renewable Energy
        Laboratory*</h3>
        <p><i><a href="http://www.eren.doe.gov/greenpower/power/index.html">Power Marketing and
        Renewable Energy</a></i><br>
        September 1997<br>
        NREL/SP-460-22080</p>
        <p><i><a href="http://www.eren.doe.gov/greenpower/netmetering.html">Net Metering Programs</a></i><br>
        September 1996<br>
        NREL/SP-460-21651<br>
        </p>
        <p><i><a href="http://www.nrel.gov/research/ceaa/emaa/open_access/index.html">Open Access
        Transmission and Renewable Energy Technologies</a></i><br>
        September 1996<br>
        NREL/SP-460-21427 </p>
        <p><i><a href="http://www.nrel.gov/research/ceaa/emaa/natural_gas/index.html">Small
        Turbines in Distributed Utility Application: Natural Gas Pressure Supply Requirements</a></i><br>
        May 1996<br>
        NREL/SP-461-21073 </p>
        <p>*<a href="green-ma.htm#order">Click Here</a> for ordering information. </td>
      </tr>
    </table>
    </center></div><p align="center"><br>
    </p>
    <p align="center">[ <a href="green-ma.htm#toc">Table of Contents</a> ] </p>
    <p><br>
    </p>
    <p>[ <a href="green-ma.htm#toc">Table of Contents</a> ] </td>
  </tr>
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