ESCO: New York PSC's Retail Energy Reset Order Did Not Exceed PSC's Authority

ESCO Says That If Other Retail Suppliers Can't Offer A Compliant Value-Added Product, It's Due To Such Suppliers', "Own Shortcomings"

January 22, 2020

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Reporting by Paul Ring • ring@energychoicematters.com

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Agway Energy Services, LLC filed comments with the New York PSC in response to various petitions for rehearing, clarification, and stay of the PSC's December retail energy market reset order, stating that any open issues arising from the order should be addressed in the collaborative process, rather than through, "motion practice"

As previously reported by EnergyChoiceMatters.com, under the reset order, Agway was specifically allowed a limited opportunity to continue to offer its EnergyGuard service during an interim period while the Track II process examines potential energy-related value-added services, which do not meet the product limits set forth in the order, that ESCOs may potentially be approved to offer, as the PSC said, "Agway provided detailed evidence demonstrating that EnergyGuard provides a unique benefit that may be reasonably comparable to its costs."

Quoting the order, Agway said that this privilege was afforded to Agway, "due to the specific credible evidence Agway submitted regarding the energy-related value of this product."

Agway said that, "the adoption of a new regime by the second reset order does not exceed the PSC’s authority."

"In their petitions/motions, certain ESCOs and trade groups take issue with this conclusion, continuing to argue that the PSC does not have the authority to implement the restrictions set forth in the Second Reset Order. This issue, however, has been definitely resolved by the Court of Appeals, and their continued protestations in this vein are contrary to what is now established and binding law in New York. Agway thus disagrees with this position as asserted by those entities and asserts that the PSC may regulate ESCOs based on price through the Second Reset Order," Agway said

Agway also said that, "the PSC’s prohibition on all alleged energy-related value-added products, with the exception of EnergyGuard during the pendency of track II was not arbitrary or unreasonable."

Agway said, "Agway submitted a wealth of confidential financial and business data to the PSC in response to the information requests because it stands by the value of its offering and has nothing to hide. Agway took the opportunity to prove the value of EnergyGuard to the PSC by detailing the innerworkings of the product and Agway’s business. Agway reiterates now, as it stated in the earlier proceedings, that the evidence it submitted demonstrates the unique value of EnergyGuard. The PSC properly considered that evidence during the course of three years of proceedings and determined that Agway’s product offering provides a tangible benefit to consumers beyond the mere provision of a commodity product."

"While Agway took the opportunity to fully participate in the proceedings, other ESCOs expressly declined, even going so far as to withdraw from the proceedings once information requests were served. To the extent other ESCOs did submit evidence to the PSC during the three year process, Agway does not have firsthand knowledge of what was submitted because all such submissions were filed under seal and kept confidential. To Agway’s knowledge, however, no other party provided supporting evidence in response to the information requests to demonstrate the value of its offering. Indeed, the PSC expressly stated as much when it concluded that no other ESCO provided any meaningful evidence to demonstrate that its product or service provides a benefit to customers comparable to its costs," Agway said

"All interested parties had the same opportunity to participate in the proceedings and to provide support for their offering and pricing. Their failure to do so, when viewed in contrast to Agway’s active participation and full disclosure, only demonstrates that the Second Reset Order, to the extent it allowed Agway to continue to offer its EnergyGuard and prohibited others from doing so, was not arbitrary or unreasonable," Agway said

Agway further said, "The Second Reset Order allows the ESCO market to continue on certain conditions and encourages the development of innovative value-added products such as EnergyGuard. It commendably prohibits unacceptable business models that do not serve the purposes of deregulations. That other ESCOs have adopted such business models or have not added value to their product offering is not the fault of the PSC or Agway. Similarly, if an ESCO is unable to develop a compliant value-added product, as Agway was able to, it is due to that ESCO’s own shortcomings."

Agway further said that, "any open issues should be resolved during track II and not by motion practice."

"The other ESCOs and trade groups argue that the Second Reset Order should be clarified or stayed because ambiguities, unresolved questions, or other open matters exist that require resolution before all parties can move forward. Agway does not disagree that there are certain open issues that exist. It does disagree with the approach taken by the other ESCOs and trade groups. Rather than challenging the entire Second Reset Order through motion practice, the interested parties should address any open administrative-type issues and establish specific procedures, including questions of timing, during Track II. This way, all interested parties can be heard and engage in a dialogue in a collaborative setting, rather than through adversarial proceedings," Agway said

Case 15-M-0127 et al.

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