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Updated: Ambit Receives NY Waiver Allowing It To Serve APP Customers; PSC Denies Requests From Two Other ESCOs

(Earlier): Draft New York PSC Order Would Approve Waiver Sought By One ESCO To Continue Service To Low-Income Customers

Drafts Would Deny Waivers Sought By Three ESCOs


September 14, 2017

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

Updated: 9/14/17, 1:35 pm

APP Service Waiver Requests

The PSC at its 9/14/17 meeting approved a waiver allowing Ambit Energy to serve low-income customers with a guaranteed savings product, in the manner described in our story below on the draft order

The PSC denied waivers to serve APP customers sought by Drift Marketplace Inc. and M&R Energy Resources Corp., for the reasons discussed in the draft orders noted below

The PSC removed from its agenda consideration of the waiver sought by Just Energy New York Corporation, and deferred action on such request. As previously reported, a draft would have denied the waiver sought by Just Energy, and the draft would have concluded that Just Energy did not definitively establish that its proposed guaranteed savings product could provide guaranteed savings to APP customers. Just Energy today filed a letter with the PSC in response to the draft, stating that, contrary to a statement in the draft, Just Energy provided supplemental information concerning its waiver request in response to Staff inquiries

Earlier:

The New York PSC is scheduled to consider at its meeting today the waivers sought by four ESCOs to continue serving assistance program participant (APP) customers.

As previously reported, the PSC has adopted an order generally prohibiting ESCOs from serving APP customers, but such order allows ESCOs to seek a waiver to serve APP customers under a guaranteed savings product (GSP).

Draft discussion documents were posted in advance of the PSC's meeting, which would address the disposition of waivers sought by four ESCOs. About a dozen ESCOs had initially sought waivers; it appears only four of the petitions may be addressed at today's meeting

Specifically, the draft documents would address the waivers sought by: Just Energy New York Corporation; Ambit New York, LLC; Drift Marketplace Inc.; and M&R Energy Resources Corp.

A draft discussion order would find that Ambit's proposed guaranteed savings product complies with the PSC's order concerning such products, and would grant Ambit a waiver to serve APP customers with its GSP product

Ambit's GSP product for APP customers provides that the customer will save at least 1% annually versus the price the customer would have paid if the customer had been a full-service customer of the utility for the same period. The draft notes that, "Ambit provided details, including the actual calculations it currently uses, to demonstrate how it calculates its monthly rate based on the current utility rate, how it intends to ensure customers are paying less than the utility rate, and proposals for monitoring and reporting customer savings to the Commission to verify compliance."

The draft would impose a sunset provision on the waiver granted to Ambit.

"[T]he Commission believes it appropriate to place a time limit on such waivers. Thus, this waiver will expire 24 months from the date of this Order. During that time period, Staff will review Ambit’s compliance with the December Order and Ambit will have the opportunity to petition for an extension of its waiver. The Commission believes it is appropriate to include such a 'sunset' provision as part of granting such a waiver given the nascent nature of the prohibition," the draft states

The draft discussion orders would deny the waivers sought by Just Energy, Drift, and M&R Energy. In general, the drafts would find that each of these three ESCOs did not definitively establish that their proposed GSP products could provide guaranteed savings to APP customers.

The drafts cite a lack of explanations concerning these three ESCOs' GSP plans in the ESCOs' filings with the PSC, such as how savings would be measured and how the ESCOs would demonstrate compliance, and the drafts would find the GSP proposals from these three ESCOs to be deficient

With respect to Drift, in particular, a draft document expresses concern about the GSP product's reliance on technology, under Drift's subscription-based, wholesale-club like model, which heavily relies on interaction with customers via internet or mobile device.

"Drift’s July 31, 2017 response clarifies that its Guaranteed Savings Plan requires their APP customers to have internet access, a device to connect to the internet and monitor their account as well as pay subscription fees, the amount of which was not disclosed in their response. Drift also explained that it invoices weekly, which is not standard and has the potential to cause customer confusion. Drift has also not provided calculations in relation to how they will ensure a lower price than the utility with their subscription fees accounted for as well," the draft states

"The Commission finds that while Drift’s business model proposes a new way of supplying energy related information directly to customers, it runs the risk of creating customer confusion and possible added costs for this service to the segment of the population that needs to be most protected," the draft states

The drafts would direct Just Energy, Drift, and M&R Energy to return APP customers to utility service (to the extent they serve such customers) within 30 days of receiving a list of such customers from the utilities, subject to the PSC's prior orders which set forth that ESCOs may continue serving APP customers until the end of a contract term. ESCOs seeking waivers had not been required to comply with the otherwise implemented de-enrollment timeline pending disposition of their waiver petitions

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