|
|
|
|
Direct Energy Petitions New York PSC For Approval Of Green Gas Programs
The following story is brought free of charge to readers by EC Infosystems, the exclusive EDI provider of EnergyChoiceMatters.com
Direct Energy Services, LLC, on behalf of itself and its affiliate Gateway Energy Services
Corporation (collectively, 'Direct Energy') petitioned the New York PSC to issue an
"expedited" declaratory ruling, finding and declaring that each of Direct Energy’s Green Gas Programs for mass market customers described in the
petition constitutes an Energy-Related Value Added ('ERVA') service that may be offered to
mass-market customers without an additional requirement of being paired with a compliant
guaranteed savings or fixed-rate product as required by the Commission’s Order Adopting
Changes to the Retail Access Energy Market and Establishing Further Process issued on December 12, 2019 (the 'Order').
"Alternatively, Direct Energy respectfully requests that the Commission grant Direct
Energy an expedited waiver from the requirements of the Order to provide each of these Green
Gas programs to mass-market customers without the requirement of being paired with a complaint
guaranteed savings or fixed-rate product. As a further alternative, Direct Energy encourages the
Commission, in its pending Order on Rehearing and Clarification, to adopt one or both of the
Green Gas products described herein as ERVAs or otherwise compliant products of general
availability such that any ESCO could offer them for sale under the terms described in this Petition," Direct Energy said in its petition
Direct Energy proposes two Green Gas Products in the petition, as described below:
A. Direct Energy’s RGGI Gas Program
Direct Energy’s first Green Gas Product is known as RGGI Gas.
The RGGI Gas product calculates a customer-specific CO2 footprint from natural gas usage and then
helps offset that usage by acquiring allowances ('RGGI or CO2 Allowances') in the auction
mechanism operated by the Regional Greenhouse Gas Initiative ('RGGI').
Direct Energy said in its petition that RGGI Gas would be identical to the Commission’s Green Power product, in that the product will
help offset 50% of the CO2 produced in the use of natural gas in the home.
Direct Energy proposes to 'gross up' the actual natural gas consumed by its customers to
include a Production and Transmission Factor. "The Production and Transmission Factor
recognizes that greenhouse gases are also produced throughout the natural gas value chain from
wellhead, through processing and gathering, and with the delivery of the natural gas to the home," Direct Energy said in the petition
"Direct Energy’s analysis shows that a reasonable Transmission Factor is 2.85%.
And a reasonable Production Factor is a further 35.00% of consumption and transmission," Direct Energy said in the petition
The RGGI Allowances Direct Energy would need to buy would be determined under the
following formula:
Allowances = Total Usage in Dth * CO2 Conversion Factor * Production Factor *
Transmission Factor * Renewable Content Factor * Pounds to Short Tons
Conversion.
Where
'Total Usage in Dth' is total gas supplied to that customer in a given period.
'CO2 Conversion Factor' is 117 pounds per mmbtu.
'Transmission Factor' is 1.0285.
'Production Factor' is 1.3500.
'Renewable Content Factor' is set at 50%.
'Pounds to Short Tons Conversion' is 1/2000.
"Applying this to the average New York natural gas user of 82.17 Dth per year, RGGI Gas would
be required to procure and bank 3.34 Allowances each year: 3.34 Allowances = 82.17 Dth *117 *
1.0285 * 1.3500 *.500 / 2000," Direct Energy said in its petition
B. Direct Energy’s "Cleaner Heat" Product
Direct Energy also proposes to offer New York residential customers a second Green Gas
Product called Cleaner Heat.
Direct Energy has designed
Cleaner Heat to enable consumers to 'virtually' electrify one-half of the home heating portion of
a typical New Yorker’s home (as if the customers were using electric heat rather than gas).
Direct Energy plans to fulfill these obligations through the purchase
and retirement of Renewable Energy Certificates ('RECs') or making the Alternative Compliance
Payment ('ACP') to NYSERDA under terms equivalent to the Green Power product authorized
by the Order.
The RECs Direct Energy would anticipate acquiring would be determined under the
following formula:
REC = Total Usage in Dth * Home Heating Factor * Electrification Factor *
Renewable Content
Where:
'Total Usage in Dth' is total gas supplied to that customer in a given period.
'Home Heating Factor' is .693, which is the average percentage used in home heating
per the Energy Information Administration for homes in New York.
'Electrification Factor' is .293, a commonly used energy equivalency in which one
dekatherm of natural gas has energy content equal to .293 MWh of electricity. This 'Electrification Factor' is used to approximate the amount of electricity it would take to
produce an amount of energy equal to the energy content of the natural gas consumed for
home heating purposes.
'Renewable Content' represents how much of the customer’s usage will be deemed
green, which is set at 50% for this product, in keeping with the 50% requirement in the
Order’s Green Power product.
"Applying this to the average New York natural gas user of 82.17 Dth per year, Cleaner Heat would
oblige Direct Energy to procure and bank 8.35 megawatt-hours of RECs deliverable into New
York each year: 8.35 RECs = 82.17 Dth *.693 * .293 Mwh/Dth * .500," Direct Energy said
"Cleaner Heat is consistent with the Green Power product set forth in the Order in that this
product will deliver 50% renewable for the electricity equivalent requirement. The green content
percentage of Direct Energy’s Cleaner Heat product will, of course, increase as the Commission
increases any obligations on the Green Power product or new obligations are placed on natural gas
by other government actions," Direct Energy said
"Because Direct Energy’s Green Gas Programs will ... provide mass-market customers with
a unique benefit that the Commission has recognized in the Order as a basis for allowing ESCOs
to market certain renewable electricity products without being subject to the pricing restraints
adopted in the Order, the Commission can and should issue a ruling finding and declaring that
Direct Energy’s Green Gas Programs qualify for similar treatment," Direct Energy said
As exclusively first reported by EnergyChoiceMatters.com, Family Energy, Inc. has also petitioned the PSC for a partial waiver of the Commission's retail energy reset order to allow Family Energy to offer two "green gas" product offerings, while NRG has said that it will submit a petition for PSC approval of a natural gas carbon offset product
Cases 15-M-0127, 12-M-0476, 98-M-1343
ADVERTISEMENT Copyright 2010-20 Energy Choice Matters. If you wish to share this story, please
email or post the website link; unauthorized copying, retransmission, or republication
prohibited.
Seeks Finding That Plans Meet Energy-Related Value Added Standard, Do Not Need To Meet Pricing Conditions Of Retail Market Reset Order
March 2, 2020
Email This Story
Copyright 2010-20 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
NEW Jobs on RetailEnergyJobs.com:
• NEW! -- Senior Retail Energy Markets Pricing Analyst
• NEW! -- Energy Market Analyst -- DFW
• NEW! -- Senior Consultant - Competitive Energy Markets -- Houston
• Channel Relations Manger -- Retail Supplier
• Customer Service Representative -- Retail Supplier
• Renewables and Energy Trader -- Retail Supplier
|
|
|