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Updated: Court Grants Temporary Restraining Order Against NY PSC Moratorium On ESCO Service To Low-Income Customers
Update: The PSC has issued a statement.
"We are disappointed but undeterred by the court's decision to temporarily slow the much-needed protections we are seeking from energy service companies for low-income customers. Our mission is straightforward - do not harm consumers and do not squander the millions of ratepayer and taxpayer dollars used to help our neediest families pay their energy bills. We will take all appropriate actions necessary to protect low-income customers from preying, unscrupulous ESCOs. We will vigorously oppose continuation of the temporary injunction at the November hearing."
See the full statement below
Earlier
An Albany County Supreme Court judge has granted a temporary restraining order against implementation of the New York PSC's July 15 order which adopted a moratorium on the ability of ESCOs to serve assistance program participant (APP) customers
The Retail Energy Supply Association (RESA) and National Energy Marketers Association (NEM) had sought relief from the court with respect to the moratorium
In the PSC's July 15 order (click here for details), the PSC prohibited ESCOs from enrolling new APP customers onto competitive supply, and had ordered that ESCOs shall cease serving their existing APP customers at the expiration of the customer's existing agreement with the ESCO, and had said that, "With respect to customers on variable rate, month-to-month contracts, the expiration of the agreement is at the end of the current billing period."
The PSC earlier this month clarified certain aspects of implementation of the moratorium (click here)
The TRO granted by the judge applies to all aspects of the July moratorium order and September order on rehearing and clarification
The judge ordered the PSC to show cause at a November 18 hearing why the court should not stay the moratorium orders and enjoin the PSC from enforcing the orders. The court further directed the PSC to show cause why the court should not find that the moratorium orders were issued in violation of the State Administrative Procedure Act (SAPA) and why the court should not find that the orders were arbitrary and capricious.
The TRO essentially precludes enforcement and implementation of the moratorium orders until at least such November 18 hearing date (and from experience with the ESCO "reset" order from February, the hearing date may well be deferred).
RESA welcomed the TRO as it seeks to prevent the PSC from disenfranchising APP customers from choice.
"The Retail Energy Supply Association (RESA) has obtained a temporary restraining order from an Albany County Supreme Court judge in response to concerns regarding the New York Public Service Commission’s Order ending customer choice in energy for customers in utility assistance programs in New York," RESA said in a statement
"The purpose of RESA’s legal action is to preserve the right of customers to have a competitive choice in energy supply options. RESA seeks to keep the competitive markets for electricity and natural gas open to all consumers," RESA said
"RESA’s legal challenge centers on concerns with the administrative process the commission used to reverse 20 years of policy promoting competitive choice in energy for New Yorkers. The Commission’s order essentially disenfranchises a population that could really benefit from competitive alternatives to utility service," RESA said
Statement from NY PSC:
We are disappointed but undeterred by the court's decision to temporarily slow the much-needed protections we are seeking from energy service companies for low-income customers. Our mission is straightforward - do not harm consumers and do not squander the millions of ratepayer and taxpayer dollars used to help our neediest families pay their energy bills. We will take all appropriate actions necessary to protect low-income customers from preying, unscrupulous ESCOs. We will vigorously oppose continuation of the temporary injunction at the November hearing.
Background:
Since 2014, we have been working with ESCOs, utilities and consumer groups to develop mechanisms that will ensure that low-income consumers that receive millions of dollars in taxpayer and ratepayer-funded discounts do not end up paying extra to their ESCOs.
There are numerous examples of low-income customers paying more than was needed.
In Central Hudson’s service territory, residential ESCO customers paid on average $38.62 per month more than they would have if they had stayed with the utility for the period 1/2014 – 2016. The variance has increased during 2016 when Central Hudson customers paid on average $51 more per month than they would have if they had stayed with their utility.
National Grid data shows that on average low income customers paid $33.61 more in the month of January than if they had been served by the utility.
These are customers that make less than $52,000 per year (family of 4) and receive ratepayer and taxpayer funded discounts up to $1000/year. These customers are preyed on by deceptive marketers – in September the Commission issued three orders to show cause against marketers with serious allegations.
NEMA states that low-income customers are being denied loyalty points and gift cards. That may or may not be true, nonetheless, due to the higher priced unaffordable energy costs, low income customers are more likely to have their energy services terminated. As consumer advocates, we need to protect customers retain vital services.
Regarding their claims of denying customers the ability to enter into fixed rate contracts – there is no evidence that fixed rate contracts benefit customers.
Further, during the 2014 polar vortex when customers could have benefitted from the fixed rate contracts they locked into, several ESCOs reneged on those agreements.
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September 28, 2016
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Copyright 2010-16 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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