Retail Suppliers Say Consultant's Petition Seeking Prohibition On Pass-Through Of New York ZEC Costs "Misrepresent[s]" PSC's Order

June 15, 2020

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Reporting by Paul Ring • ring@energychoicematters.com

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In comments on a petition from UtiliSave, L.L.C. ('UtiliSave'), which is seeking a New York PSC declaratory ruling that ESCOs may not pass-through ZEC costs to customers on fixed rate contracts unless certain conditions were met, the NRG retail suppliers alleged that, "UtiliSave has misrepresented the Commission’s directives with respect to the ZEC[.]"

As exclusively first reported by EnergyChoiceMatters.com, UtiliSave, L.L.C. submitted a petition for a declaratory ruling to the New York PSC seeking affirmation that ESCOs may not pass-through ZEC costs to customers on fixed rate contracts unless, among other things, the customer disclosure statement indicated the potential of an exercise of a change-in-law clause that would result in a revised rate

See more details on UtiliSave's petition here

In comments on the UtiliSave petition, the NRG retail suppliers alleged, "UtiliSave has misrepresented the Commission’s directives with respect to the ZEC, and ignores key provisions in the CES [Clean Energy Standard] Order in its Petition."

Quoting the CES order, the NRG suppliers said that the PSC specifically directed that, "LSEs will make ZEC purchases by contract with NYSERDA and will recover costs from ratepayers through commodity charges on customer bills."

The NRG suppliers said, "The Commission’s language is not a polite suggestion. LSEs are obligated to purchase ZECs, and then 'will' recover the ZEC costs through the commodity charge on customer bills. In other words, ESCOs are required to purchase ZECs and are allowed to pass through the ZEC charges to their customers. There is no limitation on the applicability of the ZEC to the type of customer contract – fixed, variable, or otherwise. Since all ratepayers benefit from the CES mandates, all customers contribute to the costs of the CES through the commodity charges on their electric bills."

The NRG suppliers said, "The premise underlying UtiliSave’s Petition -- that ESCOs are not obligated to pass through ZEC costs to customers on fixed price contracts -- is a clear misstatement of the directives of the CES Order. Of course ESCOs (and other LSEs) are expected to pass through the costs of compliance with the ZEC mandate and the other renewables requirements outlined in the Order. The alternative would drive many LSEs into financial ruin, which would be nonsensical."

In separately filed comments, Direct Energy said that the Commission does not have statutory authority to resolve price and billing disputes between ESCOs and their non-residential customers, citing prior PSC rulings.

The NRG suppliers also said that UtiliSave’s petition is procedurally improper, citing several reasons

Direct Energy said that the Commission must dismiss the UtiliSave petition on the grounds that the petition does not seek relief with respect to any specific, "person, property, or state of facts," as required by Rule 8.1 of the Commission’s Rules of Procedure

Case 20-E-0243

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