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Utility-Owned Generation Would Not Be Used for Default Service Pricing Under One PSNH Proposal

December 9, 2014

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Copyright 2010-14 EnergyChoiceMatters.com
Reporting by Karen Abbott • kabbott@energychoicematters.com

Public Service Company of New Hampshire has floated the idea that it retain its generating assets, but that the assets not be used to serve default service customers, with costs or benefits of the units instead applied to all customers via nonbypassable charge.

In a brief addressing certain threshold issues in an investigation of PSNH's continued ownership of generation, PSNH said that, should the PUC determine that retaining PSNH's generation portfolio is in the best interests of PSNH customers, "provisions should be made to address the manner in which default service is provided."

"One potential resolution could be to establish a nonbypassable charge or credit that would be equal to the net difference between the revenues derived from the sale of the portfolio outputs, including those in the PPAs, into the wholesale spot markets netted against the costs of PSNH's generation portfolio. By such a mechanism, all customers would benefit equally from the decision to retain the generating assets. Separately, PSNH could then procure its default service requirements in a manner similar to other utilities," PSNH said.

"By such a method, PSNH's generation would not influence the competitive market and all utilities would operate similarly. At the same time, all customers of PSNH would share equally in the benefits of PSNH's generation, which would continue to act as a hedge against volatile gas prices, and which would ensure the retention of all capacity to protect reliability," PSNH said.

Docket No. DE 14-238

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