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ESCOs Seek Remediation Period Before Any Penalties Levied Under Proposed New Pay-As-You-Go ZEC Program In New York

October 23, 2018

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

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The New York Retail Choice Coalition (the Coalition), a group of small and medium sized energy service companies, filed comments with the New York PSC proposing that the PSC adopt a remediation period prior to the imposition of any penalties that are proposed to be part of the new "pay as you go" mechanism for LSE (ESCO) compliance with the zero emissions credit (ZEC) program

Under the proposed "pay as you go" mechanism proposed by Department of Public Staff and NYSERDA Staff, LSEs will have the option to use their total forecasted load as submitted to the NYISO or Version 1 of the total LSE load data, as settled by the NYISO each month, as a basis for their monthly payment to NYSERDA. The LSE will then multiply this load, plus load served by generation from a load modifier, if applicable, by the LSE ZEC Rate to determine their ZEC obligation payment to NYSERDA for that month.

As previously reported by EnergyChoiceMatters.com, the Staffs' implementation plan proposes that LSEs be required to pay a penalty if their aggregated estimated load for any quarter is less than 85% of their actual load for that quarter. This penalty would be equal to 15% of the difference between the payment amount for aggregated estimated load for the quarter and the payment amount for the actual load for the quarter, with the minimum penalty being no less than $1,000. Penalty payment amounts would not count towards an LSE’s obligation

As first reported by EnergyChoiceMatters.com, the City of New York has opposed these forecast penalty provisions, arguing that, among other things, the PSC lacks authority to impose such penalties.

In its comments, New York Retail Choice Coalition proposed a modification to the penalty provision.

"Within the Penalty provisions, the Coalition would like to see a remediation period of 60 days to correct any payment shortfall before a penalty can be assessed. This would allow flexibility to cure any shortfall due to valid cause or clerical error before penalties are assessed," the Coalition proposed

"Regarding the amount of penalty, any penalty assessed should provide a payment schedule, if needed, to allow for the equal payment of the penalty over the duration of the compliance period. This would help alleviate any cash flow issues that a substantial penalty could impose," the Coalition proposed

The Coalition said that it generally favors the proposed "pay as you go" mechanism, noting that the mechanism will alleviate overpayments associated with the current program, which relies on historic load, in cases where an LSE has seen a material decrease in load.

Case 15-E-0302

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