Distribution Utility's Sought Offering Of Renewable Energy To Default Service Customers Called "Roll Back" Of Deregulation
July 29, 2020 Email This Story Copyright 2010-20 EnergyChoiceMatters.com
Reporting by Paul Ring • email@example.com
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The Retail Energy Supply Association filled comments at the Maryland PSC in opposition to a proposal from the Southern Maryland Electric Cooperative, Inc. to offer RECs to default service customers under a new rider (Standard Offer Service – Green, SOS-G), as RESA said that, "SMECO is asking the Commission to roll
back deregulation and impermissibly expand SMECO’s role beyond the defined scope specified
by the General Assembly to authorize a regulated non-electricity REC product."
As proposed, the rider would charge the members the additional cost for meeting that 100% green requirement above the regular SOS rate in effect. Members who choose the Rider will continue to pay the base SOS rate and the PPCA rate for their power supply and will be billed the Rider SOS-G rate as well.
"The Choice Act
requires that SMECO’s proposal be rejected," RESA said
"Allowing monopoly utilities or cooperatives to sell regulated REC customers would be
anticompetitive because, absent a full unbundling, competitive suppliers would have to compete
against a utility REC offering that is partially subsidized by distribution rate payers. SMECO
states that the proposed rate includes 'administrative costs it incurs in implementing and
maintaining the program, but no administrative or REC cost inputs were provided in the filing.
Moreover, SMECO’s proposal would be a pass-through REC product with 'no return charged in
the rider.' By contrast, competitive suppliers must recover all of their costs and their margin
within the prices they charge. SMECO’s proposed product would further tilt the playing field in
favor of the utility with a partially subsidized renewable energy offering that does not include a
return component," RESA said
"SMECO’s proposal to call a REC product 'Standard Offer Service' may be confusing to
SMECO’s members because REC products are not SOS as defined in the PUA. SMECO
proposes that members remaining on SOS would opt in to pay an additional charge for SMECO
to purchase RECs to match the customer’s electricity usage. Accordingly, SMECO would not be
selling any energy under Rider SOS-G, just RECs," RESA said
RESA said that SMECO’s green rider is not necessary because competitive renewable energy
options are already available for SMECO members.
As of July 28, 2020, there are at least
a dozen renewable energy offerings on the Maryland PSC's electric choice rate board from which SMECO members may choose, RESA said
RESA encouraged SMECO to educate customers about their renewable choices and the PSC's electric choice shopping site