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PSC Rejects Instant Connects, Seamless Moves

PSC Directs Stakeholders To Further Explore Requiring Retail Suppliers To Notify Customers Of Rate Change Via Email

PSC Directs Workgroup To Consider Additional Consumer Protections For Non-Residential Customers

PSC Discusses Enroll-By-Wallet Proposal

PSC Skeptical It Has Authority Over Energy "Consultants"

PSC Chair: "Embarrassing" That Large Number Of Consumers Aren't Aware They Can Shop For Electric Supplier 20 Years After Choice Introduced

August 27, 2018

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Copyright 2010-17
Reporting by Paul Ring •

The following story is brought free of charge to readers by EC Infosystems, the exclusive EDI provider of

During a rulemaking session last week (RM 62), the Maryland PSC declined to publish regulations which would have required implementation of instant connects (switch-at-connect, day one switching) for electricity and seamless moves for electricity and gas.

Three Commissioners generally felt that the costs of implementation outweighed any minimal benefits from instant connects and seamless moves, citing a low use of the mechanisms in Pennsylvania. From a policy perspective, Commissioners generally favored instant connects and seamless moves and would have published the regulations implementing such policies had there not been a "substantial" cost associated with implementation, Maryland PSC Chairman Jason Stanek said.

Commissioners Anthony O'Donnell and Mindy Herman expressed similar concerns about costs exceeding the benefits of implementation. The three Commissioners were open to consideration of the policies in the future if costs changed (or retail suppliers were willing to assume responsibility for the costs) or if greater benefits could be shown (such as customer demand and/or greater utilization)

Stanek did say that, "I do believe, though, that there must be plenty of other ideas that we could further to encourage customers to choose retail service providers. I think first and foremost is education. I think there is a lack of education out there for most residential customers."

"In terms of speaking with your friends and neighbors, 20 years after the fact, it's frankly embarrassing that a large number of people, consumers, ratepayers, do not know that they can select a retail choice provider," Stanek said

Commissioners expressed concerns with using significant positive POR reconciliation balances (POR collections that have exceeded POR costs) to fund instant connects and seamless moves, noting most of the positive balances result from non-residential classes

Commissioner Michael Richard favored adoption of instant connects and seamless moves, citing the legislature's directive to create a retail market, and disputing the characterization of the costs as substantial. Richard said that the choice legislation did not envision SOS being granted status as supplier of first resort, and it was only an administrative decision which enshrined this distinction. Commissioner Odogwu Obi Linton generally agreed with Richard's position.

Turning to other matters under consideration, the PSC directed that PC44 / RM62 working group further explore requiring retail suppliers, for customers for whom the supplier has an email address, to actively notify customers via email of an impending change in variable rates

Stanek was generally supportive of such proposed email notice requirement, while also recognizing arguments that the market should dictate customer communication frequency and mechanisms.

Richard argued that the issue of email rate change notices was fully considered in RM54, where the PSC rejected such proactive notice in favor of requiring the supplier to make variable rates available in advance of billing via various methods (online, phone, etc.), but in which the customer must actively look up the new rate.

Herman argued that the issue sought to be resolved via the proposed email rate change notice regulation was one of education, and was skeptical that such issue is appropriately addressed via regulation

Linton said that the email rate change notice requirement was worthy of discussion. O'Donnell said that framing of the issue would be very different if the rulemaking was occurring in the immediate aftermath of the polar vortex, and that a rule requiring emailed rate change notices could serve as a "backstop" against political shock should a similar situation arise where a large number of customers are seeing excessive rate increases

Also sent to the workgroup for further discussion were proposed additional consumer protection measures for non-residential customers, though the scope of such protections was said to be limited

Specifically, Staff said that it envisions such non-residential customer protections to be limited to clarifying that service to such customers must be governed by a "written" contract (the term written is not currently in COMAR for such C&I service). Other changes originally envisioned by Staff under this item were subsumed by other clarifications adopted by the PSC during the rulemaking (such as related to the enrollment timeline and rescission period, the latter is noted below)

The PSC also directed that the workgroup further discuss proposals from retail suppliers for an enroll-by-wallet mechanism.

Unlike the instant connect proposal, which Stanek said that Commission would have adopted but for the implementation costs, Stanek did have some concerns with the enroll-by-wallet proposal, saying that the PSC needs to weigh making the shopping experience convenient and easy versus consumer protection

Stanek did say he was intrigued by statements from RESA that the current requirement to use lengthy utility choice ID numbers or service numbers for enrollment is the "biggest barrier" to enrollment of customers

The workgroup was specifically tasked with identifying why existing utility account look-up tools are insufficient, and with calculating implementation costs for enroll by wallet

The PSC also returned to the workgroup issues related to non-LSE, third party access to customer AMI data.

The proposed rule would have created a new category under COMAR, an "energy consultant", and set forth proposed regulations governing such consultants' access to AMI data. Consultants would have been required to register with the PSC (see details here)

Echoing concerns raised by a majority of the Commissioners, Stanek said of the approach under which non-LSE energy consultants would be regulated by the PSC, "Looking at our statute and our regs, I see no basis for us to create this new entity, this third party, to exert regulation and jurisdiction over them, create a registry, and enforce some standards upon this new jurisdictional entity."

"I do not believe that this Commission should be in the business of regulating, at all, these third part[ies]," Stanek said. "We don't have the authority by statute or otherwise," Stanek said

Herman suggested that the working group return with a solution under which customers could share Green Button data from the utility with third parties without implicating PSC jurisdiction

Also sent back to the work group was the issue of budget billing for customers on competitive supply. The proposed regulations would not have required suppliers to offer budget billing, but would have required that, if a supplier did choose to offer budget billing, such program would have to follow the method prescribed in the rules. Herman again raised jurisdictional concerns, arguing that regulating how suppliers must perform budget billing appears to inappropriately dictate suppliers' charges. Concerns were also raised regarding implementation and the responsibility of calculating the budget bill amounts for retail supply charges.

The PSC did vote to publish in the state register for comment several rules.

The PSC voted to publish a proposed rule concerning electric and gas suppliers' offers on the PSC website, providing that, in the event of a discrepancy between a supplier's open offer posted on the Commission's website and the supplier's corresponding open offer displayed on the supplier's website, the supplier shall honor the terms that are more favorable for the customer

The PSC will also look at improving its choice website.

The PSC voted to publish a proposed rule clarifying the non-residential rescission period, stating that, for both electricity and gas, a supplier is not required to offer non-residential customers a contract rescission period, "except where required by law," with the text in quotes newly added to the existing rule

The PSC voted to publish a proposed rule modifying the current agent rules, in which the supplier is responsible for the actions of its agent, and which set forth training requirements, etc., so that the agent rules now explicitly only apply to residential service, for both electric and gas.

As part of the revised agent rules, the PSC voted to publish a modification to require background checks of sales agents, providing an alternative means of compliance as an alternative to the existing use of the Maryland Criminal Justice Information System and the Federal Bureau of Investigation. Under the published rule, a supplier may alternatively conduct a background check via all of the following: A criminal history records check conducted by the supplier or a third party that includes, at a minimum, the following: (a) An All-County search through the Maryland Administrative Office of the Courts, and from all other states in which the person resided within at least the last 12 months; (b) A nationwide federal criminal court search, such as the Federal Public Access to Court Electronic Records (PACER) System; (c) A national multi-State Multi-Jurisdictional criminal database search with validation conducted by a member of the National Association of Professional Background Screeners; and (d) The U.S. Department of Justice National Sex Offender Public Registry.

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