Tel: 804.864.1100

Tel: 804.864.1100

Author Archive: grilok

Hope You Enjoyed Our Open House!

It was simply fantastic to see so many friends, colleagues and clients at last week’s Open House. We had wonderful food from Amy Beth Lehman and her team, and we were able to give everyone the “Cook’s Tour” of our new space, which is roomy and comfortable. A few of our folks left with door prizes, too: shirts, pens or dinners out.

If you did not have a chance to drop in, please come by when you can. Just let us know when you’d like to visit and get the lay of the land and we’ll be delighted to show you around and chat. The pictures below are from last Thursday.

November’s Solar Focus Gets Our Attention

The MDV SEIA’s 8th annual Solar Focus conference, the East Coast’s premier solar conference, is slated for November 17 and 18 in Washington, D.C., and we will be there, all in. We will be one of the sponsoring organizations for this outstanding industry conference. In addition, I will be moderating a panel during the meeting covering consumer protection issues in the region.

Energy professionals across the East Coast will be watching this conference for developing issues and industry trends. Organizers expect more than 300 solar industry leaders from the private, public, and nonprofit sectors will gather together to ensure spirited debate and meaningful dialogue, according the Dana Sleeper, executive director.

The Consumer Protection panel I will moderate on the morning of November 18 includes William Reisinger of the Virginia Attorney General’s Office, Elizabeth Stern from the Maryland Attorney General’s Office and Steven Eisenberg from SRECTrade, a Solar Renewable Energy Certificate (SREC) transaction and management firm. We will be discussing actions of state Attorney General offices in pursuing bad actors in the solar market and consumer rights, such as challenges presented by neighbors (especially shade), HOAs, pop ups, and others that infringe upon consumer systems and their ability to become energy-independent.

We look forward to seeing clients and friends at the Hyatt Regency Capitol Hill during the many social functions and educational events. Let us know if you are planning to attend so that we can be sure to keep an eye out for you.

Maryland PSC Lowers Retail Natural Gas Suppliers’ WGL Winter Collateral

Decision Relieves Retail Suppliers from Paying Excessive Collateral to WGL 

 

The Maryland Public Service Commission has granted a request by Washington Gas Light and two retail suppliers to lower the collateral for suppliers operating on WGL’s system for the winter season.  Click here for WGL’s initial filing and here for the supplemental filing that proposed an amendment to the WGL tariff.  This is a significant reduction that will help retail suppliers continue to bring competitive natural gas products and services to WGL’s Maryland customers.

A little background:  retail suppliers must post collateral twice per year (winter and summer) to operate on WGL’s system.  The purpose of the collateral is to protect WGL in the event a supplier defaults and does not deliver gas to WGL, and WGL is forced to buy gas on the wholesale market. WGL calculates each supplier’s collateral based on a formula in the tariff.  If a supplier does not post by October 15, it cannot continue to enroll new customers. If a supplier does not post by October 31, it will be booted out of the WGL choice program.

Without getting into a whole lot of boring detail here about the formula used to calculate collateral, I will just say that one of the biggest factors in the formula is the use of Transco Zone 6 Non-New York prices from the past three years.  The problem with employing the formula for this winter season was that last year’s extremely and unusually cold weather caused the Transco Z6 NNY prices to increase dramatically on certain days during the year.  Strict adherence to the tariff formula would have resulted in WGL collecting about $54 million in collateral this year as compared to about $4 million last year.  WGL recognized that $54 million in collateral is excessive.

The “new and improved” formula, which is in effect for this winter season only, reduces the Transco Z6 NNY price by eliminating every day during the past year when the price exceeded $20.00 per Dth.  That eliminated 13 days. Whereas the price last year was around $8.00 per Dth, it would have jumped to $25.21 this year.  Eliminating the 13 days brings the price back down into that $8.00 neighborhood.

How big of a deal is this?  Suppliers who posted $300,000 in collateral for last year’s winter season would have seen their collateral jump to between $2 million and $2.5 million, with no significant increase in customers or throughput. The only suppliers who would not have felt this pain would have been those who attained a certain credit rating from a ratings agency – something that most smaller suppliers have not attained.

Suppliers should be hearing from WGL in the next few days about their reduced collateral requirement.  Since most suppliers have already posted the larger amount, we suspect that they will be afforded a chance to amend their bonds or reduce their letters of credit, etc., to meet the new, lesser amount.

Finally, WGL and Maryland Commission Staff will monitor this year’s Transco Z6 NNY prices to see if last year really was an anomaly.  The Transco Z6 NNY price is actually an average of the past three years, so WGL would need to make a filing next year if last year’s prices continue to skew the formula and result in excessive collateral requirements.  Yes, that is right – the $25.21 is an average of the past three years’ prices, so you can imagine how high the 13 days were thatthrew the entire formula off-kilter.

GreeneHurlocker’s lawyers represented the Retail Energy Supply Association at the Maryland Public Service Commission with respect to this issue.

 

Eric Hurlocker Elected VP of SEIA MDV

That’s a lot of letters just to tell you that Eric is now vice president of the Board of the Maryland – District of Columbia – Virginia Solar Energy Industries Association, as reported by association exec Dana Sleeper last week.

Eric joined the MDV-SEIA Board of Directors last year and serves as general counsel to the association. His work includes identifying and tracking legislation in the Virginia General Assembly that may affect solar and other renewable power development.

He said, “I am looking forward to expanding my role on the MDV-SEIA board and within the regional solar community. This is a particularly exciting time to be working the solar industry, as there is much change on the national level, the regional level, and particularly in Virginia, where my firm is located.”

MDV-SEIA members design, sell, integrate, install, maintain and finance solar energy equipment for residential, commercial, and institutional customers throughout the region and the membership includes accountants, attorneys, builders, architects, electricians, plumbers, and consultants that support solar industries, according to the group. Solar has made tremendous strides in the Mid-Atlantic over the last few years and MDV-SEIA has led the policy changes that have created this market, reports its website.