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Utility Proposes Changes to Choice Program, Including Mandatory Rate Board and PSC Staff Review of Supplier Pricing
DTE Gas Company (MichCon) has filed with the Michigan PSC changes to its voluntarily offered natural gas customer choice program, including the creation of a mandatory supplier rate board, and PSC Staff review of pricing
DTE Gas is proposing to make the following voluntary changes to its gas customer choice program:
• Implementation of a centralized comparison website developed, maintained and paid for by DTE Gas where all suppliers who are actively soliciting and enrolling new customers into the program will be required to post current pricing and other related terms and conditions of their residential and small commercial offerings
• Implementation of a single aggregated delivery for each supplier where each supplier will only be required to nominate one monthly aggregated amount
• Modification of the Supplier Equalization Charge so that it applies to all customers and is determined on an aggregate basis
• Requiring suppliers to include information informing their customers of DTE Gas's current $10 switching fee that applies beginning with the second supplier switch, and each subsequent supplier switch, within a 12 month period
• Inclusion of supplier price offerings in the current PSC Staff review of supplier marketing materials to assure clarity of marketing materials, improve the understanding of potential choice customers with regard to a supplier's gas supply contract pricing, and assure consistency between the prices offered in the marketing materials and the information provided on the centralized website.
On the last point, DTE said that the change will clarify the tariff to state that the PSC Staff may review all supplier price offerings, "by taking into account current market conditions and alternative competitive offerings."
Regarding the mandatory rate board, suppliers will be required to post and update "all" of their current rate offering(s), listing the type of rate, fixed or variable.
If variable, the supplier must include an explanation of how the rate is derived, "along with an example of the highest variable rate that could be charged."
The supplier must also list the term of the offering and any applicable early termination fee.
"Suppliers will be required to update the website to add new offerings or omit outdated offerings at the time changes occur. The specific mechanics related to data uploads and other technical details have not yet been finalized," DTE said.
Suppliers would also be required to promote the website to customers. DTE's tariff revisions provide that, "[t]he web site address must be included in all marketing materials issued by suppliers with the following statement: 'All pricing available to you in this program, including this offering and DTE's current gas rate (GCR Rate) can be found at A similar provision would be required to be included in the supplier's contract with the customer.
If it is determined that a supplier is not maintaining accurate and timely information on the rate website, DTE will cease processing new enrollments for the longer of: a) the remainder of the calendar month in which the deficiency has been identified, or b) the time at which the Company is satisfied that the supplier has taken corrective action.
The mandatory rate board, plus Staff review of supplier price offerings when Staff conducts its review of marketing materials, "will benefit customers who are or are considering participating in the choice program by insuring consistency between price information in the Suppliers marketing materials and the centralized website, improve the understanding of potential choice customers with regard to an Supplier's [sic] gas supply contract pricing, and provide transparency with respect to all of the applicable fees associated with choice participation," DTE said.
"DTE Gas is responding to its customers' stated position that they want greater price transparency in the GCC program," DTE said of the changes.
Based on a customer survey, "[o]ver 90% of GCC customers and over 85% of GCR customers want a centralized location to compare rates between the utility and alternative gas suppliers for ease of comparison," DTE said.
Over 60% of all customers indicated that they wanted an oversight agency to review suppliers' commodity price offerings, DTE said.
In supporting testimony, in response to the question that, "Do other states with GCC programs require Suppliers to participate in this type of centralized website," (emphasis added) a DTE witness stated, "Yes. Ohio, Pennsylvania, Illinois, Georgia, and New York have such requirements."
It was not immediately clear if participation on all such rate boards (particularly Pennsylvania) was mandatory.
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October 16, 2013
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Reporting by Paul Ring • ring@energychoicematters.com
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