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Ohio Orders RFPs To Select Retail Suppliers To Serve Eligible Low-Income Customers

March 3, 2016

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Copyright 2010-16 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

The Public Utilities Commission of Ohio has ordered that the electric utilities shall conduct RFPs to select a retail electric supplier to serve the load of percentage of income payment plan program (PIPP) customers.

PUCO's order follows recent statutory revisions, in which R.C. 4928.54, as updated on September 29, 2015, provides that the state's director of development services shall aggregate percentage of income payment plan program (PIPP) customers for the purpose of establishing a competitive procurement process for the supply of competitive retail electric service for those customers. The process shall be an auction, and the PIPP price must be below the SSO rate

PUCO ruled that each electric utility shall implement a competitive RFP auction to serve PIPP load in the electric utility's service territory. PUCO said that the competitive RFP auction shall immediately be implemented to procure supply for the amount of PIPP load that would otherwise have been included in the utility's next SSO auction. The RFPs will be developed by the electric utilities, in consultation with Staff, and conducted in conjunction with their upcoming auctions

Only registered competitive retail electric service providers (CRES) in Ohio would be eligible to participate in the RFP process, with their participation subject to any credit requirements the utility may have that would be necessary to assure supplier performance.

The RFPs shall procure supply for PIPP load for a period of 12 months, and every registered CRES provider in the electric utility's service territory shall be provided the opportunity to participate, pursuant to R.C. 4929.54 and subject to any credit requirements the utility may have that would be necessary to ensure supplier performance, PUCO said

All offers in the RFP shall be made to serve the entire amount of the PIPP load that would otherwise have been included in the SSO auction, and the RFP issued by the electric utility should explain how it will determine who will serve the PIPP load, in whole or in part, if there are multiple winning bidders. Further, all RFP auction results and winning bids will be subject to Commission approval. The electric utilities may modify their existing Master Supply Agreements (MSA) or implement new PIPP auction MSAs, but shall work with the Commission's Staff if they determine such modifications are necessary, PUCO said

PUCO said that in the unlikely scenario that no CRES providers participate in the RFP auction, then the electric utility should consult with Staff to conduct a supplemental RFP auction. The supplemental RFP auction may request proposals to serve the PIPP load at the best available price, even if such price is above the blended SSO price. While this may occasionally result in the PIPP load being served at a price higher than the blended SSO price, the RFP auction has been established to reduce the cost of the PIPP program to the otherwise applicable SSO over the long-term, in compliance with R.C. 4928.542(B), PUCO said

In the unlikely scenario that both an initial and supplemental RFP auction fail to procure supply for the PIPP load, then the load should be procured from the market through bilateral transactions much the same way an SSO auction would if it did not result in all available tranches being filled, until such additional RFP auctions can be conducted, PUCO said

PUCO said that the RFP auction process should be implemented immediately. Accordingly, each electric utility shall notify SSO auction participants for its next SSO auction that the PIPP load will be removed from the auction product and will be procured pursuant to this competitive RFP auction process. By removing just that portion of the PIPP load that would have been included in the next auction, each year a greater portion of the PIPP load will be served by an RFP auction winner until all of the PIPP load has been removed from the SSO auctions.

Each electric utility may recover the costs of conducting the RFP auctions in the appropriate rider, and we will consider pursuant to an appropriate application whether additional costs such as billing changes, software upgrades, or programming should also be recovered, PUCO said

Case No. 16-247-EL-UNC

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