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Regulator Directs Retail Supplier to Justify Legal Basis for Pass-Through Charges

April 3, 2015

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Copyright 2010-15 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

The Connecticut PURA has directed Liberty Power Holdings, LLC to answer several questions regarding, including its legal justification for, Liberty Power's potential imposition of a pass-through charge on certain Connecticut customers.

As explained by Liberty Power in a statement to EnergyChoiceMatters.com (full statement provided below), Liberty proactively reached out to PURA staff to inform them of a pass-through charge that certain commercial customers would be seeing related to ISO-NE's Winter Reliability Program (WRP). Specifically, the pass-through charge relates to contracts executed prior to the creation of the Winter Reliability Program

That notice prompted PURA to issue a series of questions to Liberty. Notably, some of the questions intimate that PURA may consider the pass-through to constitute "back-billing" under the statute, and directs Liberty to justify why the pass-through does not constitute back-billing and is otherwise authorized under statute.

Questions posted by PURA include:

• Are the pass-through costs already included in each customer’s generation rate? If so, explain how.

• Are any pass-through charges proposed to apply retroactively? If so, how is the proposal not back-billing, and how does it comport with Section 16-259a of the Connecticut General Statutes? Separately, provide any other statutory reference(s) Liberty believes authorize its proposed approach to pass-through billing Connecticut customers.

• Explain how retroactive billing/pass-through charges are memorialized in current Connecticut customer contracts.

• Explain how many customers are proposed to be billed the pass-through charge, and whether the pass-through charge is proposed to be applied to customers with variable rate plans, fixed rate plans, or both. How does the Company propose to determine which of its customers are subject to the pass-through charge, and which customers are not subject to the charge.

• How can current customers who may be subject to the proposed pass-through charge avoid it? Does Liberty propose to re-bill the pass-through charge to customers who are no longer customers of record?

• Provide the calculation(s) used to determine the pass-through charge amount Liberty proposes to assess each of the subject re-billed customers. Separately, explain how the charges are proposed to be depicted on the bill.

• Explain in full how and when affected Connecticut customers are to be notified of the proposed pass-through charge

• Does Liberty propose to assess and recover the pass-through charge on the local electric distribution company bill? Provide any pass-through charge information (e.g., talking points) Liberty has provided to Eversource and United Illuminating to prepare the electric distribution company customer service staff for phone inquiries they may field

• What regulatory approvals are necessary from PURA in order for Liberty to impose the pass-through charges

Liberty Power provided the following statement to EnergyChoiceMatters.com:

"As part of our commitment to transparency in communications to regulators, customers and stakeholders, we proactively reached out to CT PURA staff to inform them of a pass-through charge that customers would be seeing related to ISO-NE’s Winter Reliability Program (WRP). This charge impacts a limited number of commercial accounts in Connecticut. The WRP is a relatively new program that FERC approved in September 2013. As a result, the pass-through only impacts commercial customers that contracted with Liberty Power prior to October 2013, when the program was first established. It is our understanding that PURA issued a letter in a formal docket in response to our request to meet with PURA Staff to discuss the pass-through. We look forward to working with PURA to answer any questions they may have which may also help them better respond to any customers who may call them regarding this issue."

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