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Update: NY PSC, ESCOs Provide Statements On Temporary Restraining Order Against ESCO Low-Income Prohibition

September 30, 2016

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

The New York PSC and ESCOs have issued statements concerning an Albany County Supreme Court judge's order granting a temporary restraining order against implementation of the New York PSC's July 15 order and September order on clarification which adopted a moratorium on the ability of ESCOs to serve assistance program participant (APP) customers

The New York PSC issued the following 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.

"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."

ESCOs also provided reactions

Natara Feller, Managing Partner at Feller Law Group, PLLC, said, "Once again, a judge determined that the PSC violated procedural rules in their ongoing ‘Reset’ of the retail market. These procedural rules in place protect the public from swift and potentially unjust agency action. It is likely that many customers on government assistance signed up with ESCOs in order to receive the benefit of value added services that only ESCOs (and not the utilities) can offer. Like all other mass market customers, these customers deserve the benefit of continuing with the ESCO of their choosing without interruption from the PSC."

Feller Law Group serves as counsel to the Impacted ESCO Coalition

"With the TRO in effect against the Low-Income Moratorium, affected parties will finally have their rightful opportunity to receive proper notice of the drastic changes the PSC is seeking to make, submit comments, and take a meaningful part in shaping how the market will treat low-income customers," Feller said

The Retail Energy Supply Association (RESA), one of the petitioners which had sought relief from the court (along with the National Energy Marketers Association), had also issued a statement earlier in the week.

"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

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