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ConEd Ordered to File Proposal to Lower Hourly Pricing Threshold
A final New York PSC order in Consolidated Edison's electric rate case requires the utility to file a proposal to expand mandatory hourly pricing (MHP) to customers with demands over 300 kW.
The requirement for an hourly pricing expansion proposal was one of several retail market provisions contained in a joint proposal approved by the PSC.
Specifically, ConEd is required to file a proposal to expand its MHP program to include customers with demands over 300 kW within 12 months after the completion of reactive power meter installation. The reactive metering project is scheduled to be completed by the end of 2014
The current hourly pricing cutoff at ConEd is 500 kW.
Any proposal for MHP expansion still requires approval from the New York PSC.
"Such proposal will include an evaluation of the existing MHP program and may propose a phase-in or other staged approach of any MHP expansion," the adopted joint proposal said.
New York's steady implementation of lower hourly pricing thresholds had been called into question by a consultant's study submitted in 2012 which had said that mandatory hourly pricing expansion had little impact on customer usage and therefore costs of continued expansion outweighed the benefits
Additionally, the adopted joint proposal provides that ConEd will take steps to change its method of calculating capacity charges for Mandatory Hourly Pricing customers from a calculation based on each customer's peak demand to a calculation based on each customer's installed capacity (ICAP) Tags.
"Because of significant system modifications needed to implement such a change, the Company will begin training efforts to provide information on the new method to affected customers in the spring of 2015, for implementation in the spring of 2016," the JP provides.
In other retail market directives under the rate case order, Consolidated Edison will become the latest New York utility to offer a comparison of historic ESCO prices and default service rates.
Specifically, under the order, ConEd will develop, in consultation with New York PSC Staff and interested parties, an online historic bill calculator that will allow electric and gas retail access customers to perform a historical comparison of their prior year's ESCO bill compared to what they would have paid that year as a full service Con Edison customer.
The joint proposal requires ConEd to develop and implement the calculator, "as soon as practicable but no later than December 31, 2014."
Additionally, the adopted joint proposal provides that ConEd will begin working with energy service companies on enhancing ESCO service portability for residential customers within 60 days of a Commission order adopting the joint proposal.
"The Company will implement enhanced ESCO service portability for residential customers no later than December 31, 2014," the joint proposal states.
The joint proposal also addresses New York ISO settlement, and as part of its NYISO reconciliation system upgrade, ConEd will modify its reconciliation method to be based on time-differentiated usage for non-interval metered customers taking service under a time of use rate. ConEd expects that this upgrade will be complete by December 31, 2015.
The joint proposal also requires ConEd to offer a new voluntary time of use (VTOU) generation rate in which the off-peak period will be midnight (12 a.m.) to 8 a.m. A VTOU delivery-only rate option, which allows customers to remain with their ESCO, will be offered as well.
Customers that elect the VTOU rate as retail access customers and then switch to full service must remain on the VTOU rate as full service customers for one year from the date of the switch. Customers that elect the VTOU rate as full-service customers must remain on the VTOU rate as full-service customers for one year from the date of the switch.
The rate will include a "price" guarantee for full-service or retail access customers registering a Plug-in Electric Vehicle (PEV) with ConEd. The guarantee will apply for a period of one year commencing with the first full billing cycle after the customer registers the PEV with ConEd.
Under the price guarantee, the customer will not pay more over the course of the one-year period than it would have paid under the SC1 Rate I rates. This comparison will be made on a total bill basis for full service customers and on a delivery-only basis for retail access customers. The delivery-related component of customer credits provided under the price guarantee will be recovered through the revenue decoupling mechanism (from SC1 customers). The commodity-related component of such customer credits will be recovered through the MAC.
Retail suppliers had protested the offering of a TOU generation rate, noting the utility billing barriers to the offering of such a service by ESCOs. The PSC rejected these protests.
"While we recognize the ESCOs' arguments that obstacles exist to ESCO participation in the retail VTOU market, we are not persuaded that these rate proceedings are the appropriate forum for their ultimate resolution or that they warrant delaying the implementation of the new VTOU program. Con Edison already has a VTOU rate in place and the issues identified by the ESCOs are neither new, nor necessarily specific to Con Edison customers. In our view, these issues should be grappled with in a generic proceeding where we might consider a cost/benefit analysis of implementing changes to facilitate retail VTOU competition on a state-wide basis," the PSC said.
"In so deciding, however, we nevertheless adopt the proposal to require Con Edison to make the necessary changes to enable it to report an ESCO customer's non-interval metered on-peak and off-peak usage to the NYISO by the end of 2015. Given that Con Edison is in the process of updating its entire reconciliation system, efficiencies support the decision that Con Edison make the necessary changes during that process rather than await a determination in a generic proceeding. Accordingly, the VTOU program is adopted as set forth in the Joint Proposal," the PSC said.
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February 24, 2014
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Reporting by Karen Abbott • kabbott@energychoicematters.com
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