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retail supplier

What’s the Latest on Supplier Consolidated Billing?

transmission towers for electricityWe have blogged previously about a petition filed at the Maryland Public Service Commission by five electric and natural gas retail suppliers seeking implementation of supplier consolidated billing (SCB). We did a video about it when the petition was filed, and our last blog on this topic was in February 2018, just after the legislative-style hearing concluded in Baltimore.

In the blog, you’ll see that we summarized the events at the hearing and even provided a picture of the four supplier witnesses testifying before the Commission, along with Brian Greene of our firm, so that everyone could get a feel for what it’s like to appear before the Commission (from the view of the Commissioners, no less!).

So what happened in the case since then, you ask?

In May 2018, the Commission issued this Notice of Briefing Schedule, requesting comments primarily on the legal issue of whether Maryland statutes allow a supplier utilizing SCB to initiate the disconnect process if the customer does not pay. Parties, including the petitioners, submitted comments on June 14 and June 28. We are now awaiting a Commission order or further guidance.

There’s also an SCB proceeding pending at the Pennsylvania Commission. On June 14, 2018, the Commission held a legislative-style hearing that will continue on July 12, 2018. You can get more info on the Pennsylvania proceeding here.  Delaware is also moving towards an SCB proceeding, with a recent Hearing Examiner’s report in Docket No. 15-1693 recommending approval of a Stipulated Order that calls for a new docket to be opened now to address whether SCB is permitted in and should be adopted in Delaware.

If you have questions about SCB or electric or natural gas retail service in general, please contact one of GreeneHurlocker’s energy and regulatory lawyers.

DC Commission Instructs WGL to Implement a Purchase of Receivables Program

The District of Columbia Public Service Commission (PSC) has issued an Order directing Washington Gas Light Company (WGL) – the only natural gas distribution utility in the District – to implement a purchase of receivables (POR) program for competitive retail natural gas suppliers that sell natural gas supply in the District.  WGL must file an implementation plan by July 17, 2017, and stakeholders may comment on the plan within 15 days thereafter.

In the Order, the PSC adopted components of a POR program that will resemble WGL’s program already in effect in Maryland, and also Pepco’s program already in effect in the District. At the outset, the PSC made clear that POR programs promote customer choice, thereby increasing competition and reducing commodity prices. The PSC noted that the availability of POR programs has led to increased supplier participation in Maryland and in the District’s electric choice programs.

The PSC addressed the elements of the discount rates for suppliers serving residential and non-residential customers. Without going into every component, WGL’s POR will be non-recourse as to suppliers and the POR discount rates will include: (1) bad debt expense; (2) implementation costs; (3) incremental collection costs; (4) cash working capital costs; (5) risk factor; (6) reconciliation factor; and (7) late payment revenues. A few points here worth mentioning:

  • WGL must include in its implementation plan a detailed breakdown of implementation costs. WGL has previously stated that its the costs will range from $600,000 to $800,000, which the PSC noted is far more than the $150,000 it cost Pepco to implement a POR program in the District in 2012, and far less than the $3.3 million it cost WGL to implement a POR program in Maryland in 2012.
  • The risk factor will be set to zero.
  • WGL must include late payment revenues collected on purchased receivables in the discount rate.
  • Non-commodity charges, such as early termination fees, are not to be purchased.

The PSC initiated this case after the Retail Energy Supply Association (RESA) raised POR as an issue in a separate proceeding regarding WGL’s billing system. The PSC held, in that case, that consideration of a POR program was warranted, and initiated Formal Case 1140 to consider it. Stakeholders, including WGL, RESA, and the Office of People’s Counsel, filed comments in FC 1140 during the months leading up the Order.

If you would like more information about GreeneHurlocker’s work in the competitive retail energy space throughout the Mid-Atlantic region, or other related areas, please contact one of our energy lawyers.

Delaware Arguments Are Covered at EnergyChoiceMatters.com

We’re grateful for the coverage EnergyChoiceMatters.com put out yesterday about the staff-suggested changes to proposed Delaware rules that the Retail Energy Suppliers Association and the Division of Public Advocate (DPA) worked out earlier this year. We think are these changes in the proposed rules are market killers because of their supplier and consumer requirements. You can read their complete coverage here. The Delaware Commission posted pictures of the meeting here.

If you have any questions or concerns about the Delaware rules or any energy regulation matter in the mid-Atlantic, simply contact one of our energy lawyers.

Panelists Cover Rates and Users and Regulators Respond

Brian Greene co-managing member of the firm, spoke on the “response panel” at the Mid-Atlantic Distributed Resources Initiative Working Group Meeting. Brian’s panel responded to presentations made by an earlier panel involving rate design issues and retail price integration. Entitled “Retail Rate Design for Default Energy Service,” and held at the offices of District of Columbia Public Service Commission on March 22, 2016, the subject is a hot topic among utilities and utility commissions around the country because of the effect that various rate design elements (e.g., fixed charges, demand charges, energy charges, etc.) have on consumer bills and consumer decisions regarding distributed energy resources.

Brian’s comments were, in large part, focused on the various products and services available in today’s competitive retail electricity market in states where consumers have the right to choose their energy supplier. Brian also discussed the importance of allowing retail suppliers access to their own customers’ smart meter data on a next-day basis or sooner. Suppliers today have the ability to process enormous amounts of data relating to energy usage and present the data to their customers in a way that the customer can understand it. These products, combined with data access and today’s technology, empowers customers to better understand and take control over their energy usage.

Brian also spoke about the need for proper cost allocation among default energy service and distribution service. In many states, customers that their electricity from a retail supplier continue to pay the utility’s costs related to the provision of default service even though the customer is not taking default service. That is because many default service costs are embedded in regulated delivery service rates and have not been properly allocated to default service. As an example, a portion of a utility’s call center is used for default service related activity, but typically the utility recovers those costs in delivery service rates. This means that the default service rate does not include all of the utility’s costs to provide that service, which is important because a retail supplier must include these same types of costs in its prices that it charges to its customer and cannot rely on a guaranteed income stream.

After lunch, the initial panel and the response panel fielded questions from the audience.

If you would like to know more about retail rate design issues or anything related to the energy distribution industry, please contact Bran or any of the energy lawyers at our firm.

Maryland Commission Adopts New Consumer Protection Rules

On February 10, 2016, the Maryland Public Service Commission approved revised consumer protection regulations governing the retail sale of electricity and natural gas. The revised rules include several substantive changes relating to how retail suppliers operate in Maryland. The changes involve additional up-front pricing disclosures to customers, and additional notices throughout each customers’ contract term. One of the more significant operational changes is a new requirement that utilities process a customer’s request to switch electricity providers within three business days. The revised Rules also include entire new sections addressing retail suppliers’ relationships with their marketing and sales agents.

We have previously blogged here, here, and here at various stages of this two-year rulemaking. In sum, the Commission initiated this rulemaking in response to the extreme cold weather conditions in the beginning of 2014 that caused wholesale energy prices to spike dramatically. Generally speaking, customers who had signed up for monthly variable retail priced contracts, which are tied to wholesale prices, saw their retail rates increase considerably. The primary policy goals of the revised rules is to assist customers in better understanding the energy products they are considering, to require certain notices to customers during their contract term, and to afford customers the opportunity and flexibility to change their energy provider quickly to take advantage of pending offers.

The next step for implementation will be publication of the final rules in the Maryland Register. While the timing of the publication is uncertain, it is anticipated that the rules will become effective at some point in March 2016. Retail suppliers will need to review their contract language, third-party verification scripts, training materials, and other areas to ensure they are complying with the new rules. Retail suppliers that are unable to comply with any of the new requirements will need to seek a waiver from the Commission.

If you have any questions about Maryland’s new retail energy supplier rules or the process for seeking a waiver, please contact one of GreeneHurlocker’s energy lawyers for more information.

New Maryland Working Group May Give Retail Suppliers Better Access to Meter Data

canstockphoto17677884The Maryland Public Service Commission has established a new Working Group to develop statewide protocols that will allow retail electricity suppliers to access their customers’ smart meter interval data from the utility on a near real-time basis. In a recent Order, the Commission established the Working Group in response to concerns expressed by the Retail Energy Supply Association (RESA) and NRG Retail Affiliates (NRG Retail) that while Baltimore Gas and Electric Company (BGE) collects the customer interval data, the manner in which BGE makes the data available to suppliers via the BGE portal is so cumbersome and burdensome that it is impossible for suppliers to access their own customers’ data. RESA and NRG Retail contended that BGE lagged behind other utilities in Maryland such as Pepco and Delmarva Power, both of which allow retail suppliers to pull hourly usage batch data on a next-day basis. The Commission directed the Working Group must file a report by March 1, 2016.

Suppliers’ access to their customers’ smart meter interval data in near real-time is a major advantage of smart meter deployment and will allow retail suppliers to expand their product offerings. Efficient data access allows retail suppliers to quickly process the data and present the results in plain English to their customers. This information exchange enables customers to make a connection between what they are doing at a given time and their electricity usage at that time, and they can change their usage behavior and shift their energy consumption as quickly as possible. Older data is simply less valuable and useful to customers, and makes it harder for retail supplies to “engage” with customers.

Technology has dramatically altered consumer expectations and changed how we buy products. We are now living in “Amazon time” where we expect instant access to timely information, from the number of steps we take in a day, to watching basketball games online, to getting election results in real-time. We can buy Alaskan salmon and have it shipped across the country for dinner tomorrow night, and we can buy handmade cannoli from the famous Mike’s Pastry in Boston and have it shipped next-day delivery for a dinner party. (Yes, I did that; yes, it works; and yes, they are awesome.) The electricity usage data available from smart meters is another example of how technology has changed the electricity landscape, and is in line with the broader consumer expectations of wanting access to information and products quickly.

If you have an questions about smart metering or the Maryland working group’s progress, please contact on of our Maryland energy lawyers.

DC Changes Retail Supplier Reporting Requirements

D.C. Public Service Commission Changes Filing Requirements for Retail Electricity Supplier Semi-Annual Fuel Mix and Air Emissions Reports

Licensed retail electricity suppliers are generally required to report the fuel mix and air emissions of the energy they supply. Suppliers often have questions about the technical reporting requirements for fuel mix and emissions, including both (1) the information that must be provided and (2) the procedure for reporting that information. The lawyers of GreeneHurlocker have assisted clients with interpreting the regulatory requirements for emissions and fuel mix reports, as well as understanding how and where to file the reports, in Maryland, the District of Columbia, and Delaware. Recently, as suppliers have shifted to offering more green energy and renewable energy products, some suppliers have had difficulty interpreting the nuanced disclosure requirements regarding these renewable energy products.

The D.C. Public Service Commission has even issued orders to show cause against retail suppliers that failed to meet their fuel mix and emissions reporting obligations. Some of the suppliers subject to past show cause orders missed the filing deadline, and others were unaware of the appropriate PJM system mix to include in their reports. Licensed suppliers are obligated to fulfill the applicable reporting requirements in each jurisdiction in which they operate and, as we have learned from experience in D.C., it is important that all suppliers understand the applicable reporting requirements.

In an Order issued on December 17, 2015, the D.C. Commission revised its docketing system for fuel mix reports, providing a new docket where retail suppliers will be required to file future fuel mix and air emissions reports. As retail suppliers prepare for future fuel mix and emissions filings in D.C. and Maryland, and particularly for the upcoming D.C. semi-annual fuel mix report deadline in June of 2016 under the new docket, the energy attorneys at GreeneHurlocker welcome any questions regarding these compliance matters, or any other issues relating to the retail energy sector.

Delaware Hearing How to Improve Consumer Choice for Electricity

transmission towers for electricityIn October and November, 2015, the Delaware Commission (Commission) and the Division of Public Advocate (DPA) held two workshops for stakeholders to discuss ways to enhance the visibility of and improve participation in customer choice for electricity products and services.  The group also examined what, if any, options might be available to enhance customer choice that the Delaware Commission and stakeholders might not have been considered. The Commission accepted written comments on November 6, 2015.

GreeneHurlocker’s lawyers represented the Retail Energy Supply Association in the meetings and submitted these comments.  RESA identified market-enhancing programs and services such as a purchase of receivables program that would require the utility to purchase the receivables of retail suppliers; implementing “accelerated switching” to allow customers to more quickly take advantage of suppliers’ offers; requiring the utility to allow customers to keep their supplier if the customer moves within the service territory, which is not operationally possible now and can harm customers if they move residences; requiring the utility to allow suppliers to access prospective and current customer account information with customers consent; and revisiting the manner in which the utility currently purchases its power to serve the customers who do not choose a supplier. It will be interesting to see what the Commission and DPA do with the various comments received.     

 

Dominion Seeks Trio of Solar Farms

On Thursday, October 1, 2015, Dominion Virginia Power (“Dominion”), Virginia’s largest utility, announced its proposal to build three large-scale solar facilities with a combined capacity of 56 MW in three Virginia counties:  (i) 17 MW to be built on 165 acres in Powhatan County, (ii) 20 MW to be built on 250 acres in Louise County and (iii) 19 MW to be built on 200 acres in Isle of Wight County.  The trio of projects were the result of a competitive Request for Proposals (“RFP”) issued by Dominion in July.  

Dominion plans to purchase each of the facilities from the developers.  None of the announced projects will be owned by third party developers, but Dominion stated it is also pursuing power purchase agreements with other solar developers as a result of such RFP.

Dominion filed certificates of public convenience and necessity for the projects with the Virginia State Corporation Commission (“SCC”), seeking the SCC’s approval which would allow construction on the projects to begin next spring.  Dominion explained that the three solar projects are part of Dominion’s previously announced plan to develop 400 MW of large-scale solar projects in the state of Virginia by 2020.  The projects are estimated to cost approximately $129.5 million, excluding financing costs.  To recover such costs, Dominion has requested adding 7 cents to the average residential bill, known as a “rate adjustment clause” or “rider,” which would take effect December 1, 2016.

Dominion’s press release can be viewed here:  http://dom.mediaroom.com/2015-10-01-Dominion-Virginia-Power-seeks-to-build-56-megawatts-of-new-solar

Maryland’s New Consumer Protection Rules Hearing

The Maryland Public Service Commission has set a June 16-17 hearing date to consider the publication of new consumer protection rules for electricity and natural gas retail suppliers.  The new rules would impact several aspects of a supplier’s marketing and enrollment processes. In January 2015, the Commission Staff, the Office of People’s Counsel, and the Retail Energy Supply Association submitted extensive redlines of the proposed rules. The Commission held a hearing in February that was more of an educational hearing, and then new proposed rules were communicated to stakeholders last month.

One of the biggest issues involves the impact of the new rules on  a supplier’s ability to offer contracts where the price of the electricity or natural gas can change every month (“variable” contracts), and also contracts that automatically renew at the end of the initial term. The proposed rules would require advance notice of any price change and also customer approval, even if the customer had already consented to these terms when he or she initially enrolled. According to suppliers, the new rules would increase customer acquisition and retention costs and would discourage suppliers from doing business in Maryland.  Consumer advocates take the position that these rules are necessary to protect customers from price increases about which they might be unaware.

Another issue is the ability of a customer to quickly switch to another supplier or to his or her utility service. The new proposed rules would reduce that amount of time from 12 days before your next meter read to three business days from the date your switch request is submitted to the utility. The Commission, before setting the June 16-17 hearing date, indicated in a letter order that it wanted to see this “accelerated switching” go into effect.

For more information on Maryland energy consumer protection law or retail electrical markets, please contact the electrical power regulatory lawyers at GreeneHurlocker.