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NY PSC Staff: ESCOs' Disclosure of Customer-Specific Info, As Required Under ALJs' Discovery Ruling, May Cause ESCOs To Violate UBPs

June 13, 2017

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

Constellation Energy Gas Choice, LLC and Direct Energy Services, LLC (appellants) filed a motion for interlocutory appeal of a recent discovery ruling from the presiding ALJs in the retail energy markets evidentiary proceeding, as Department of Public Service Staff separately said that disclosures required by the ALJs' ruling may cause ESCOs to violate the Uniform Business Practices due to the directed disclosure of personal customer information.

As first reported by EnergyChoiceMatters.com, the presiding ALJs recently granted a motion to compel filed by Public Utility Law Project of New York, Inc., in which the ALJs ordered ESCOs to respond to PULP's data requests, which include requests for certain customer personally identifiable information (PII).

Constellation Energy Gas Choice, LLC and Direct Energy Services, LLC sought interlocutory appeal of the ALJs' order on several grounds, repeating arguments raised in their original objections to the discovery.

In particular, the appellants note that the ALJs' ruling requires the appellants to produce customer-specific information, including customer name and address, the customer's distribution company and distribution company account numbers, and audio recordings of sales and verification of enrollment calls in their responses to discovery requests

"In doing so, the Ruling does not engage in any reasoned decision-making or even address the Respondents’ or other parties’ arguments that production of this information would violate the clear requirements of the Commission-approved UBP, Commission precedent, and existing customer contracts," the appellants said

"The Ruling fails to recognize that the Commission has already determined that, even in the absence of direct evidence of improper use of such information, protection of customer PII is particularly critical in the retail access markets and explicitly protected from disclosure to third parties," the appellants said

"Specifically, the UBP prohibits a distribution company from disclosing customer information unless the customer agrees to switch providers and, even in that circumstance, may only share such information with the providing ESCO whom the customer has entered into an agreement for electric or gas service," the appellants said

"The ESCO itself is strictly prohibited from 'selling, disclosing or providing any customer information obtained from a distribution utility . . . to others . . . unless such sale, disclosure or provision is required to facilitate or maintain service to the customer or is specifically authorized by the customer or required by legal authority,'" the appellants said

"[A]s recognized by DPS Staff, none of the exceptions that would permit ESCO production of PII is satisfied here. Therefore, any disclosure of PII on the part of an ESCO would violate the UBP, subjecting the ESCO to possible enforcement action by the Commission," the appellants said

"Under the circumstances, only the Commission itself may waive the prohibition against the production of PII to third parties. The circumstances giving rise to the need for the Commission to include such stringent customer privacy protections are no less relevant (and perhaps more prevalent) in these proceedings. Any disclosure of the PII in response to discovery requests would violate the clear provisions of the UBP. Therefore, the Commission must overturn the Ruling on the ground that PII is protected from disclosure to third parties," the appellants said

A broad variety of stakeholders agreed that the ALJs' order erred in requiring the disclosure of PII.

For example, while DPS Staff opposed a stay of the ALJs' discovery ruling, DPS Staff said in a filing that the ruling should be modified to exclude the release of PII, and said that disclosing this customer information may cause the ESCOs to violate the UBP

"Customer privacy concerns, on the other hand, do present an exceptional circumstance that your honors should address," DPS Staff said "The Public Service Commission has a policy of protecting PII, which includes customer name, address, and distribution utility account number, from disclosure to third parties. In most instances, this information is held by the customer’s distribution utility and only disclosed to third parties with the consent of the customer. Pursuant to the rules established in the Uniform Business Practices (UBP), a customer that signs up with an ESCO consents to having their information shared with the ESCO for the purposes of enrollment, but the ESCO is not entitled to further share that information with third parties. The UBP permits an ESCO to disclose customer information only when disclosure 'is required to facilitate or maintain service to the customer or is specifically authorized by the customer or required by legal authority.'"

"In this instance, none of these exceptions apply," DPS Staff said. "Therefore, Staff believes that disclosing this customer information may cause the ESCOs to violate the UBP. Further, in the interest of protecting customer privacy, the ESCOs in this proceeding should not be required to provide the customer PII in response to the interrogatories propounded by PULP on ESCOs in these proceedings."

The joint utilities similarly said, "Regardless of whether PULP has executed the Protective Agreement in this proceeding, requiring the ESCOs, or the Joint Utilities, to provide customer specific information, including but not limited to, customer name, address, and account numbers, to a third party without the consent of the customer would be inconsistent with this longstanding policy and with ordinary customer expectations for data privacy."

The City of New York likewise said, "The City has been a long-time proponent of customer privacy. Your Honors’ Ruling permits the names, addresses, distribution utility and account number of energy service company ('ESCO') customers, as well as audio recordings and verification transcripts of customer conversations, to be provided to one or more third parties without customer consent. This customer information is highly confidential, and disclosure of such information to third parties that were never intended to be the recipients of such information without customer consent not only violates a customer’s reasonable expectation of privacy, but is contrary to the Department of Public Service’s ('Department') rules of procedure, the Public Service Commission’s ('Commission') Uniform Business Practices ('UBP'), as well as general Commission precedent governing customer privacy."

Consumer Power Advocates said in a filing that it, "wishes to express its extreme concern and opposition to the release of its members’ (or anyone else’s) customer-specific information, including name, address, and utility account numbers."

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