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PPL: Provision Contained in NRG's Supplier Consolidated Billing Proposal Could "Trap" Customers On "Substantially" Higher Retail Supplier Rates

January 24, 2017

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Copyright 2010-17 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

A provision proposed by NRG Energy as part of its request to institute supplier consolidated billing for electricity in Pennsylvania could "trap" customers on higher retail supplier rates, PPL Electric said in comments to the PUC

As exclusively reported by EnergyChoiceMatters.com (see story here), NRG in its petition said that, under SCB, a mechanism is needed to prevent customers with a "past due" SCB balance from switching a supplier or dropping to default service.

Though NRG did not outline specific provisions, NRG had said that, "Under SCB, an EGS needs a means of assuring that a customer on a payment arrangement cannot use their ability to switch EGSs to avoid paying all of their charges, including charges for supply and delivery. A tool is needed to permit EGSs to apply a block on a customer's account to prevent a customer from switching to another EGS or the EDC until that customer has paid his or her past due bill in full."

The text of NRG's petition was unclear as to whether NRG was proposing this measure only for a subset of customers with a formal "payment arrangement" to pay off past due amounts (such as Texas), or more broadly for any customer with a past due balance

In any case, PPL said in comments to the PUC that, "Under NRG's proposal, customers could be trapped in substantially higher rates, because they cannot switch to another EGS or back to default service before fully paying their past due bill to the participating EGS."

"NRG's proposal to prevent customers from switching to another EGS or back to default service before paying their account balance in full to the participating EGS would be highly inequitable," PPL said. "A participating EGS could effectively trap customers, including low-income customers, into remaining enrolled with the EGS, even if its rate is substantially higher than another EGS's offerings or the EDC's Price to Compare ('PTC')," PPL said

"This issue should be of great concern to the Commission, considering its experience during the Polar Vortex in 2014," PPL said. "Many residential and small commercial customers quickly saw their variable rates spike and ended up owing hundreds, sometimes thousands, of dollars to certain EGSs. The inability of these customers to quickly switch to another EGS or back to default service was the impetus for the Commission's accelerated switching regulations. However, under NRG's proposal, a customer would be prevented from switching until his or her entire balance is paid in full, resulting in an exorbitant amount of money owed to the participating EGS in such a situation," PPL said

"If another extreme event like the Polar Vortex happens and NRG's or any participating EGSs' variable rates spike, the Commission's measures to help insulate customers from being locked in to high rates will be of no help. All of those customers will be unable to switch to default service or another EGS while their rates skyrocket. Therefore, NRG's proposal should be rejected because it could trap customers in substantially higher rates," PPL said

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