ARM Files Reply Comments Regarding Rule Changes Proposed In Light Of Elimination Of System Benefit Fund
October 11, 2017 Email This Story Copyright 2010-17 EnergyChoiceMatters.com
Reporting by Paul Ring • email@example.com
The Alliance for Retail Markets filed reply comments in Texas PUC Project 47343: Rulemaking To Amend Chapter 25 Substantive Rules Relating To The Elimination Of The System Benefit Fund
The members of ARM participating in this proceeding are: Ambit Energy, L.P. d/b/a Ambit Energy; Champion Energy Services, LLC; Constellation NewEnergy, Inc.; Direct Energy, LP; NRG Retail Companies; and TXU Energy Retail Company, LLC.
ARM's reply comments are reproduced below:
REPLY COMMENTS OF THE ALLIANCE FOR RETAIL MARKETS ADDRESSING STAFF STRAWMAN PROPOSAL
The Alliance for Retail Markets (ARM) timely files these Reply Comments filed in response to comments filed on September 25, 2017 addressing the Staff Strawman Proposal (Strawman). The absence of a response to a proposal or position offered by another party in comments should not be interpreted as ARM's agreement to the proposal or position.
I. Statutory Authority for Proposed Rule Amendments
Texas Ratepayers Organization to Save Energy (Texas ROSE) and Texas Legal Services Center (TLSC) (collectively, Texas ROSE/TLSC) contend the scope of the proposed rule amendments in the Strawman exceeds the legislative intent of House Bill 1101 (H.B. 1101), which the Legislature enacted in 2015. Under the express directives of H.B. 1101, the System Benefit Fund (SBF), the associated low-income electric discount, and the low-income electric customer identification authorization in PURA §§ 39.903 and 39.9039 all expired on September 1, 2017, necessitating the repeal of the Commission's electric substantive rules in Chapter 25, Subchapter Q (System Benefit Fund) and the revision of other Chapter 25 rules referencing those expired mechanisms. While Texas ROSE/TLSC appear to not dispute those categories of Chapter 25 modifications proposed by the Strawman, they oppose the elimination of certain unfunded low-income mandates that primarily appear in those electric substantive rules, asserting those proposed amendments lack any basis in the statute. ARM disagrees with that assertion.
A critical factor that Texas ROSE/TLSC fail to acknowledge is the impact of recently enacted Senate Bill 1976 (S.B. 1976) on the Commission's electric substantive rules. Codified in amendments to PURA § 17.007 enacted during the last regular legislative session, the bill took effect on the same date upon which the SBF, the associated low-income electric discount, and the low-income electric customer identification provisions in PURA expired, i.e., September 1, 2017. Indeed, S.B. 1976 was enacted to address the pending expiration of those statutory provisions. New PURA § 17.007(a) authorizes the Commission to continue the development of an automatic process for identifying low-income electric customers in conjunction with the Health and Human Services Commission (HHSC) following the expiration of the SBF and associated low-income electric customer identification provisions, in order to enable REPs to voluntarily offer their own customer service, discounts, bill payment assistance, or other methods of assistance to those customers in a cost-effective and objective manner. Furthermore, new PURA § 17.007(c) states the Commission may not require a REP to offer customer service, discounts, bill payment assistance, targeted bill messaging, and other benefits for which the REP is not reimbursed.
ARM reads the plain text of the latter statutory provision to now prohibit the Commission from ordering unreimbursed low-income program and benefit mandates, given its inclusion in a bill (i.e., S.B. 1976) addressing the continuation of a process for the purpose of identifying low-income customers eligible for a REP's voluntary low-income programs and benefits. Given the limitation on the Commission's authority to order REPs to implement unreimbursed low-income programs and benefits in new PURA § 17.007(c), the Strawman properly proposes to eliminate the unfunded low-income mandates in the Commission's rules that Texas ROSE/TLSC argue should be retained in violation of current statute.
ARM also notes the differences of opinion reflected in the parties responses to Question Nos. 1 and 2 as to whether the Commission can (as a legal matter) and/or should (as a policy matter) require a REP to submit annual reports relating to its voluntary low-income programs and benefits. In this regard, ARM reiterates the position stated in its Comments requesting the Commission to carefully consider first whether any such reporting is necessary, and if so, advising it to be mindful of the incentives and disincentives created by any such reporting requirements.
Finally, contrary to the Office of Public Utility Counsel's (OPUC) and Texas ROSE/TLSC's affirmative responses to Question No. 3, new PURA § 17.007(c) expressly prohibits the Commission from ordering REPs to implement any new unreimbursed bill messaging targeted at low-income electric customers per the statutory provision's unequivocal language. Consequently, ARM does not agree with the comments respectively filed by OPUC and Texas ROSE/TLSC implicitly interpreting the statutory provision in a contrary fashion.
II. Option to Independently Identify Low-Income Customers
Both OPUC and Texas ROSE/TLSC envision the possibility that a REP not opting into receiving and funding the list of low-income electric customers developed by the Low-income Designation Administrator (LIDA) may nevertheless provide its own voluntary low-income programs and benefits based an independent identification of those customers. ARM agrees that nothing in PURA, including PURA § 17.007, expressly prohibits a REP from today relying upon an independent qualification process identifying low-income electric customers in the absence of (or supplemental to) access to the standardized list.
That said, ARM posits there are solid policy reasons to support a REP's use of the LIDA list in the administration of its voluntary low-income programs and benefits: (1) the list identifies a "low-income electric customer" according to the objective definition of the term in 16 T.A.C. § 25.5(65); (2) the list facilitates a REP's ability to administer its voluntary low-income benefits and programs in a cost-efficient manner, particularly when a significant number of REPs (such as in the current fiscal year) agree to fund the development and maintenance of the list for the 12-month period; and (3) the list achieves conformity across REPs in terms of the low-income electric customers eligible for their voluntary benefits and programs. If a REP chooses to determine the eligibility of low-income electric customers without accessing the LIDA list, it does so at the risk of Commission inquiry and investigation with respect to the legitimacy of the methodology and criteria it employs to identify customers eligible for its voluntary low-income programs and benefits. Such a risk does not exist, however, when the REP employs the LIDA list to identify low-income electric customers for its voluntary offerings.