Quote:
Originally Posted by eldondre
just so were clear, the debt free plan is afarce, simply shuffling money around. Second, the only way to pay down debt is to increase rates while the suburbs decrease them. That's a positive with an asterisk. The asterisk is we have to pay extra. It should pay no dividends to the city until rates are in line to peco. The city is the reason we have this problem to begin with. Pgw has improved but it still has an extremely high cost structure. That needs to be addressed. Knudsen is to be applauded and it's not hisfault it's such a disaster but something should be done to ensure we keep getting competent management.
|
Starting with a $1.2 billion debt and in five years having an $800 million debt is not shuffling money around. What on earth are you talking about.
I pay more in gas bills than any person I know, and it really bothers me (I just paid an electric bill yesterday on a building where I pay for both heat and air and I can assure you that I'd rather pay for air). The gas company should be buying me drinks all winter long, just to help me forget the checks I write to them. However, it bothers me more to have a gas company with a $1.2 billion debt and which is essentially insolvent. The thought that the gas company will cash flow away one third of its debt over the course of four years (the first year seems to be a tread water year) is immensely comforting to me. It means that the pain will recede as the gas company gains back its financial health. When I was a kid Philly had insanely high electric rates, due to PE's need to pay for its nuclear plants (keep in mind that I have been in this business since my childhood). Pennsylvania ingeniously allowed PE to recover its sunk costs in the power plants while allowing competition (and price-fixing) to cause PA's electric rates to drift lower and lower (I think mostly via inflation). 30 years ago Philly had the highest electric rates of any city in the USA. Now we have among the lowest (but not for much longer - our rates are scheduled to float soon). I see the model repeating itself with PGW, and I can't be happier.
The insane gas bills I paid last winter shouldn't go up by much over the next five years, as last winter was one of the fiercest on record. I am also hoping that I am already paying the emergency increase, as opposed to waiting for it to kick in (I am pretty sure I have already been paying it).