Daze of My Life: Stabilized, For Now
Daze of My Life
Stabilized, For Now
It's official, effective June 1, 2007, I'm now a paying part of the BG&E Rate Stabilization plan. One call is all it took. As a result, if I understand correctly, and there's an excellent chance that I don't, my electric bill/rates will only increase by 18 percent this year instead of the 50 percent market conditions and fossil fuel prices dictate that they should. The deficit, the amount of electricity that I will be using but not currently paying for, does not disappear, however. Oh no. It registers on my bill - and in my account balance, it just doesn't need to be paid, in 2007. It accumulates, interest-free, until April of 2009, at which time the piper will officially need to be paid.
There are some adverse consequences to me if I'm not the payer of record when the bill ultimately comes due but, 18 months and two air-conditioning seasons/cycles later, is a bit too far in the future for me to worry about in the present. Heck, for all I know, the price of oil and by refining association, the price of gasoline, could be higher in '09 than it is in '07 - and thus my overall energy/utility bills could actually be higher than they are now, but I'll take a definite over a maybe, especially when financially, I could definitely use the relief now and maybe I won't need it in 2009.
Deferral is a wonderful thing, though. Department stores, retailers, mortgage bankers, etc., do it all the time. In fact, as consumers, we're fairly - or unfairly - accustomed to the idea: why pay today when you can pay tomorrow? Let your future cash flow deal with the effects of your present lifestyle. You only live once, so far as we know - or remember - so why spend your time worrying about money today when you can spend the money instead? Sure, the chickens will eventually come home to roost, but who doesn't want - or who couldn't use - an interest-free loan?
As a former financial planner, if there's one thing I remember, other than the need - and responsibility - to pay yourself first, it's the benefit of using other people's money to help grow your own portfolio: leverage is the industry word most commonly associated with this admonition. And with respect to the subject being discussed here, deferral of utility payments to the Utility Company, since they have a bit more money than I do, they can probably afford the blip in their cash-flow-collections better than I can tolerate it in my payables. It's not exactly leverage but I will be using their money, for awhile, anyway.
So damn the torpedoes and full speed ahead, and let the chips - and the cliches - fall where they may. I'm not paying the going rate for my electric bill for two years and there's nothing anybody can do about it. Besides, given the rising cost of everything as a consequence of $65-plus for a barrel of oil, what exactly is the electric company going to do to me that isn't already being done every day, try to get blood from a stone? It's not happening, it never happens. Moreover, I have to be honest, if I'm between a rock and hard place and an easier way out presents itself, I'm in; not just for a dime but for all the dollars I can defer. I may live to regret my decision to defer, but for now, at least I can live, and for that I'm grateful, and maybe even a little bit greedy.
Kenneth B. Lourie is a regionally syndicated columnist who resides in Burtonsville, MD.