Retail Regulator's Staff Propose That Default Service Rate Be Included On Retail Supplier's Contract Summary

Proposal To Define Small C&I Customer

Addresses Proposal For Regulator's Near Real-Time Access To Telemarketing Recordings, TPVs

Regulator Seeks Comment On Changes To Current Limit On Door-to-Door Marketing Notice Of Five Municipalities

November 20, 2020

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Reporting by Paul Ring • ring@energychoicematters.com

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A Massachusetts DPU hearing officer has sought comment on several DPU Staff and stakeholder proposals regarding the DPU's ongoing investigation into retail energy marketing issues (Docket 19-07)

Default Service Rate On Retail Supplier Contract Summary

DPU Staff have presented a proposal in which Contract Summary Forms for electric and gas products would identify the current basic service/gas supply rate, and the month through which the rate will be in effect; identify the upcoming basic service/gas supply rate (if known at time of enrollment), and the effective date and term of the new rate

This information would be provided in the bottom box of the Contract Summary Form, directly preceding the Department’s statement regarding Energy Switch/Gas Division website.

As noted by the hearing officer, "Department staff concludes that the information on the Contract Summary Form should be limited to the identification of existing and upcoming basic service/gas supply rates, consistent with the presentation of basic service rates on the Website. While staff recognizes the value of providing consumers with information regarding the cyclical nature of basic service/gas supply rates, we conclude that the difficulty of conveying such information on the Contract Summary Form in a concise and useful manner outweighs the benefits that such information would provide to consumers. Staff concludes that consumers are better served by being directed to the Department’s website to better understand this dynamic - the Website for basic service prices and the Gas Adjustment Factor webpage for gas supply rates. To clarify to consumers that competitive suppliers are providing this information as a regulatory requirement of the Department, the language would be preceded by 'A Message from the Massachusetts Department of Public Utilities.'"

Consistent with the above, Staff proposes the following language for Contract Summary Forms for electric supply products:

"A Message from the Massachusetts Department of Public Utilities - Your electric utility offers you a basic service supply product at a price of [xx] cents per kWh through [month/year]. For the period [month/year] through [month/year], the basic service price will be [xx] cents per kWh. The Department recommends that consumers visit the Energy Switch website to view the broad range of available electric supply products, including your electric utility’s basic service. You can visit the website at http://energyswitchma.gov."

OR

"A Message from the Massachusetts Department of Public Utilities - Your electric utility offers you a basic service supply product at a price of [xx] cents per kWh through [month/year]. A new basic service price will be in effect for the six-month period beginning [month/year]. The Department recommends that consumers visit the Energy Switch website to view the broad range of available electric supply products, including your electric utility’s basic service. You can visit the website at http://energyswitchma.gov."

Similar language is proposed for natural gas contract summaries

Under the proposal, the Department would provide information on its Website regarding, for each distribution company: (1) the existing basic service/gas supply rates, (2) the date on which Competitive Entities must include upcoming basic service/gas supply rates on their Contract Summary Forms, and the rates to be so included; and (3) when upcoming rates are not known, the month that the upcoming rates will go into effect. Competitive Entities would be responsible for accessing this information and presenting it accurately on their Contract Summary Forms. Staff seeks comments on the proposal.

Definition Of Small C&I Customers

The DPU previously identified the following new initiatives, adopted in May 2020 (see story here), as being applicable to the marketing and provision of competitive supply services to both residential and small C&I consumers: (1) identification of third-party marketing vendors; (2) disclosure of product information; (3) marketing scripts; (4) recording of telemarketing calls; (5) review of direct mail marketing materials; and (6) automatic renewal notification. However, small C&I customers were not specifically defined.

Department Staff proposes to define an electric small C&I consumer as a non-residential consumer whose annual electric usage does not exceed 15,000 kilowatt-hours

Department Staff proposes to define a gas small C&I consumer as a non-residential consumer whose annual gas usage does not exceed 7,000 therms, consistent with the definition set forth in 220 CMR 14.00.

Department staff proposes that, for a gas or electric C&I consumer that has multiple distribution company accounts (e.g., a fast food chain with multiple locations), Competitive Entities may aggregate the usage of each individual account to determine whether the consumer should be treated as a small C&I consumer for the purpose of complying with the applicable initiatives.

Staff seeks comment on the proposal in general, and specifically on the treatment that should be provided to new gas or electric distribution customers, for whom historical annual usage is not available.

Notice Of Assignment Of Gas Contracts

Previously, in D.P.U. 14-140-D, the Department established rules for the assignment of customers between electric competitive suppliers.

Department Staff proposes to extend these rules established in D.P.U. 14-140-D to gas suppliers. This proposal requires gas suppliers to notify the Department, the distribution companies, and affected customers when customers are assigned to a new competitive supplier, pursuant to the directions specified by the Department. D.P.U. 14-140-D at 23.

Limit On Municipalities Included in Door-to-Door Marketing Notices

Retail suppliers must file door-to-door marketing notices with the DPU, and the DPU previously limited each door-to-door marketing notification to identifying a maximum of five municipalities in each notification

In D.P.U. 19-07-A at 23, the Department previously stated that it sees merit in commenters’ recommendations that the Department impose the five-municipality limit on a regional or vendor basis (rather than statewide), but concluded that more discussion is required to better understand the pros and cons of these approaches.

Retail suppliers have proposed that the Department impose the five-municipality limit on a distribution company service territory basis, rather than on a statewide basis. Under such an approach, electric Competitive Entities could identify, in each of their door-to-door marketing notifications, five municipalities that are located in each of the service territories of Massachusetts Electric Company and Nantucket Electric Company, each d/b/a National Grid ('National Grid'); Western Massachusetts Electric Company ('Eversource West') and NSTAR Electric Company ('Eversource East'), each d/b/a Eversource Energy ('Eversource'); and four municipalities in the Fitchburg Gas and Electric Light Company d/b/a Unitil ('Unitil') service territory, for a total of 19 municipalities statewide.

Similarly, gas Competitive Entities could identify up to five municipalities in each of the gas company distribution company service territories in the Commonwealth: The Berkshire Gas Company; Blackstone Gas Company; Eversource Gas Company of Massachusetts10 and NSTAR Gas Company, each d/b/a Eversource Energy; Liberty Utilities (New England Natural Gas Company) Corp. d/b/a Liberty Utilities; Boston Gas Company and the former Colonial Gas Company, each d/b/a National Grid; and Unitil, for a total of 32 municipalities statewide.

Department Staff seeks comments from stakeholders on the proposed approach summarized above. As part of these comments, Staff seeks input from stakeholders on whether the Department should defer consideration of such an approach until such time that the DPU gains more information and experience on the application of existing the five-municipality limit on a statewide basis.

Staff also seeks input on whether the Department should condition the five municipality per service territory approach on a Competitive Entity agreeing to use global positioning system/geotracking technology to track the location of its employees and vendor agents that are door-to-door marketing on the Competitive Entity’s behalf.

Finally, Staff seeks input from stakeholders on the appropriateness of applying the five municipality per service territory approach to the gas competitive market, given the larger number of gas service territories in the Commonwealth.

Also with regard to the five municipalities limit for door-to-door marketing notices, the DPU previously ruled that suppliers shall provide notices for specific neighborhoods in Boston, and that each individual neighborhood will count towards the five municipality limit

The DPU seeks comment on extending the neighborhood notice requirement, including counting each neighborhood as part of the five municipalities limit, to Worcester and Springfield.

The hearing officer's request for comments includes the specific proposed neighborhoods (maps) proposed for Worcester and Springfield. Click here for the notice with maps

The hearing officer noted that, for the period September 14, 2020 through October 31, 2020 significantly more Competitive Entities identified Springfield in their daily door-to-door marketing notifications than in any other municipality (or, in the case of Boston, neighborhood) in the Commonwealth. In recent weeks, Worcester is among the top municipalities identified by Competitive Entities in their daily door-to-door marketing notifications

Notice Of Door-to-Door Marketing To Local Officials

Staff has presented a proposal for the process by which Competitive Entities would notify municipal officials of upcoming door-to-door marketing activities.

Under Staff’s proposal, municipalities that seek to be so notified would be required to provide to the Department contact information (i.e., name, email address) for a designated municipal official(s). The Department would make such information readily available on its website. For municipalities that provide contact information for a designated official(s), a Competitive Entity would be required to send an email to the designated official(s) of each municipality that the entity intends to door-to-door market, as indicated in its notification to the Department. Such email would include (1) contact information for the Competitive Entity and its third-party marketing vendor(s) (i.e., name, position, email address, and phone number), and (2) the date(s) of expected door-to-door marketing in the applicable municipality, as indicated in its notification to the Department.

Competitive Entities would be required to notify municipal officials two business days in advance of the door-to-door marketing date, consistent with the notification provided to the Department. The requirement to notify a municipality would be contingent upon the Competitive Entity and municipality arranging for the transfer of confidential information.

Real-Time Access To Telemarketing Recording/TPVs

Staff has presented a proposal in which Competitive Entities would be required to provide the Department with access to telemarketing (and accompanying TPV) recordings, ideally on a real-time basis (in order to allow for a proactive review of such recordings), but at a minimum, within three business days of a Department request. Stakeholder comment is sought on the proposal. As a final matter, Staff notes that the Department will address the issue of real-time access to recordings as a Tier Two initiative in the proceeding

Renewable Product Info On Contract Summaries, Energy Switch Website

Staff has presented a proposal that would require Competitive Entities to state on their Contract Summary Forms whether a product’s voluntary renewable energy resources: (1) are located outside or within the New England region, and (2) have been designated by the Commonwealth as RPS Class I resources

Staff proposes specific language for three types of voluntary renewable energy products. Consistent with the Department’s approach in D.P.U. 19-07-A, Staff’s proposed language takes into account only those clean energy resources required under the Clean Energy Standard (inclusive of RPS Class I), the RPS Class II, and the RPS Class II Waste-to-Energy requirement – it does not include either the Alternative Energy Portfolio Standard requirement nor the Clean Peak Energy Portfolio Standards.

Staff proposes as follows:

1. For voluntary renewable energy products that include renewable resources that are located outside the New England region, the Contract Summary From would state:

The Commonwealth of Massachusetts requires that all electric supply products include, in [2020], a minimum of [27]% clean energy resources that are located within the New England region, including at least [16]% of which the Commonwealth has designated as 'premium' renewable resources. This product includes [100]% renewable energy resources. The resources that exceed the minimum requirement may be located outside of the New England region and have not been designated as 'premium' resources by the Commonwealth.

2. For voluntary renewable energy products for which all of the voluntary renewable resources are located within the New England region but are not RPS Class I resources, the Contract Summary Form would state:

The Commonwealth of Massachusetts requires that all electric supply products include, in [2020], a minimum of [27]% clean energy resources that are located within the New England region, including at least [16]% of which the Commonwealth has designated as 'premium' renewable resources. This product includes [100]% renewable energy resources and all of the resources that exceed the minimum requirement are located within the New England region, but have not been designated as 'premium' resources by the Commonwealth.

3. For voluntary renewable energy products for which all of the voluntary renewable resources are located within the New England region and are RPS Class I resources, the Contract Summary Form would state:

The Commonwealth of Massachusetts requires that all electric supply products include, in [2020], a minimum of [27]% clean energy resources that are located within the New England region, including at least [16]% of which the Commonwealth has designated as 'premium' renewable resources. This product includes [100]% renewable energy resources, all of which are located within the New England region and have been designated as 'premium' resources by the Commonwealth.

For voluntary renewable products that do not fit into one of these definitions, Competitive Entities would need to submit the Contract Summary Form for Department review. Competitive Entities that seek to use alternative language would also need to submit the Contract Summary Form for Department review.

With regards to the Energy Switch MA website, Department Staff presented a proposal that would eliminate the minimum renewable energy content requirement for Non-RPS Class I products. As such, the Website would display information related to the voluntary renewable energy content of all products that exceed the content required by the Commonwealth, irrespective of whether the product is composed entirely of RPS Class I resources. Staff seeks comment on this proposal.

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