OPC Says Low-Income Customer Participation In Retail Choice Outpaces Overall Market

Says Data Voluntarily Provided By One Utility Shows Low-Income Customers Paying More Than SOS

Renews Call For PSC To Require All Utilities To Report On Costs Paid By Retail Choice Customers Versus Default Service

June 21, 2019

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Reporting by Paul Ring • ring@energychoicematters.com

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In comments on an FY 2020 plan concerning the electric universal service program (EUSP) in Maryland, the Office of People’s Counsel said that low-income customers on competitive retail electric supply at the Southern Maryland Electric Cooperative (SMECO) have incurred, "massive net losses" versus SOS pricing

OPC said that only SMECO agreed to provide an aggregate comparison of costs for EUSP and Maryland Energy Assistance Program (MEAP) retail electric customers on competitive supply versus SOS. OPC said that the Exelon utilities did not provide the data on the grounds that costs to compile and provide the data may not be recoverable in rates since the PSC has not directed the utilities to provide the data.

OPC said, "SMECO’s aggregate billing data reveals massive net losses for each of the four reported months ... an overall net loss of $78,764.8 -- representing just four of the past twelve months from the utility with the smallest customer base among the five reporting utilities."

Specifically, OPC reported that the aggregate loss for EUSP/MEAP customers on competitive supply, versus SOS, was as follows for the billing periods:

Billing Period      (Loss)
June 2018        ($14,759.78)
September 2018   ($16,179.92)
December 2018    ($24,895.90)
March 2019       ($22,929.25)

During these billing period, the percent of EUSP/MEAP customers at SMECO on competitive retail supply varied from 11% to 30%.

OPC said, "Note that because these numbers are aggregated, it is not possible to tell how many of these EUSP/MEAP customers paid more than if they had remained on SMECO’s SOS rate. In fact, in September 2018, four customers of a supplier collectively saved $13.13. Three other customers collectively saved 11 cents in December, 2018. Finally, a group of 23 customers also collectively saved $92.47 in March 2019. Despite these modest collective gains enjoyed by a dozen-and-a-half, hundreds of other customers spent much more for the same number of kilowatt hours that could have been acquired for tens-of-thousands of dollars less over that period. Moreover, collectively these customers consumed much more of the limited EUSP/MEAP credits than if the entire group had paid SMECO’s SOS rate rather than whatever price the suppliers had charged them individually."

"The additional data provided by SMECO shows that low-income customers served by retail suppliers paid higher prices in the aggregate for all the reported periods. In light of this data, OPC urges the Commission to direct the rest of the electric companies to provide aggregate billing data," OPC said

For the past three years, OPC has requested that the Commission direct the utilities to provide the aggregated billing data needed to determine if EUSP participants purchasing electricity from retail suppliers are using more of the limited funds intended to provide adequate benefits than would be the case if those customers were instead charged the Standard Offer Service rate by their local utilities.

Last year, the PSC only directed the EDCs to report the number of EUSP (and MEAP) customers that receive electric or gas supply from a retail supplier, but not aggregate cost comparisons

OPC said that such data shows that in each reported quarter, energy assistance customers (i.e. those receiving EUSP and/or MEAP) are more likely to be served by a competitive retail supplier than residential customers as a whole.

For example, for June, 2018, 24.1% of residential customers in BGE’s service territory were served by electric suppliers, OPC said. The EUSP/MEAP customer data BGE provided for that period shows that 28.8% of energy assistance customers were served by retail suppliers, OPC said

For March 2019, OPC reported the percent of EUSP/MEAP customers on competitive supply, versus the overall number of residential customers on competitive supply, as follows:

Residential Electric Choice Participation
              EUSP/MEAP     Overall
              Customers     Customers
BGE             24.27%       23.90%
Pepco           23.70%       19.50%
Delmarva        17.4%        13%
Potomac Edison  13.20%       11.10%
SMECO           11.64%       2.60%

OPC requests that the Commission direct the utilities to report (for the past 24 months and then on an ongoing basis):

(a) how many EUSP or MEAP customers receive electric or gas supply from a retail supplier for each billing period in the past 24 months;

(b) the total aggregate amount those customers paid in retail supply charges for each billing period in the past 24 months;

(c) the total aggregate usage (in kWh or Therms) appearing on those customers’ bills for each billing period in the past 24 months; and

(d) the total aggregate amount those customers would have paid for default (e.g. SOS or SS) service from the utility based on the usage for each billing period in the past 24 months.

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