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Vistra ESCOs Seek New York PSC Approval To Offer Home Warranty And Maintenance Product Under Retail Market Reset Order

December 14, 2020

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Copyright 2010-20 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

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Vistra Corp. petitioned the New York PSC for a declaratory ruling from the Commission recognizing Vistra’s home warranty and maintenance product ("the Warranty Product") as a permissible energy-related value-added products and services ("ERVAS") under the PSC's Second Retail Market Reset Order, or, in the alternative, providing Vistra a limited waiver to sell and provide the Warranty Product to current and prospective customers during the pendency of the Commission’s review of ERVAS during Track II of the retail market review proceedings, which has yet to commence.

As previously reported, ESCOs under the reset order are limited to providing mass market customers with certain discrete products, such as a guaranteed savings (versus the utility) plan, or a fixed rate product that is limited in price to a 12-month trailing average utility supply rate plus a 5% premium. The PSC ruled that Agway Energy Services may continue to offer a type of home warranty and maintenance product, as an ERVAS not subject to the product limits listed above, pending Track II of the proceeding. To date, Agway is the only ESCO for which the PSC has found that an ERVAS not subject to the pricing limits described above may be offered.

In its petition, Vistra stated, "The Second Reset Order ... states that only Agway has the option to provide this type of product to customers and requires all other ESCOs to petition the Commission for approval of their ERVAS products. Vistra offers warranty protection services similar to Agway in other markets. Unlike the numerous other examples of potential qualifying ERVAS cited in the Second Reset Order, which have not previously been reviewed by the Commission, there is no meaningful distinction between Agway’s product and the Warranty Product."

"Since the Commission has previously ruled that such products are compliant ERVAS, a petition for declaratory ruling is warranted here to clarify that Vistra may provide customers with the Warranty Product once the product restrictions in the Second Reset Order take effect. In addition, as noted below, it is also in the public interest for the Commission to issue a declaratory ruling recognizing the Warranty Product as a compliant ERVAS," Vistra said

Specifically, Vistra said of its product that, "The Warranty Product is a home services product that provides customers with security by covering certain repairs and replacement of customers’ home heating and cooling equipment in the event of mechanical failures. With the Warranty Product, customers are able to call at any time, 24 hours a day/seven days a week, to report a problem. The customer is then matched with local service professionals who will respond to the service request within a reasonable amount of time, depending on the severity of the issue."

"Vistra’s Warranty Product will be offered through two home warranty specialist companies who Vistra has maintained a partnership with for more than eight years. These companies have extensive experience providing warranty services across the states Vistra serves. Vistra has the capability in other competitive markets to bill customers as a line item on their commodity bill for the warranty service, or bundle warranty products into a customer’s commodity product. The latter offering is similar to Agway’s EnergyGuard product that includes a warranty product bundled with retail electricity or retail natural gas commodity service. Under Vistra’s warranty products, customers do not pay for covered parts and labor expenses," Vistra said

"The Warranty Product plan covers customers’ heating, ventilation, and air conditioning ('HVAC') units, including unknown pre-existing conditions. The maximum amount of annual coverage allowable under the Warranty Product is $6,000; $1,000 for electrical line repair and $5,000 for HVAC repair and replacement. While electric line protection claims do not have a deductible, HVAC claims have a deductible of $60 and a per visit cap of $500. In addition to warranty protection for repairs, Vistra will provide customers with access to seasonal tune-ups of their HVAC system for preventative maintenance," Vistra said

"Similar to Agway’s EnergyGuard product, the Warranty Product provides customers with peace of mind and security that should their home heating and cooling equipment fail, someone will be available 24/7 to assist the customer. Further, the Warranty Product provides access to prescreened and licensed professionals to assist with needed home repairs and replacements of heating and cooling systems so customers do not need to worry about finding a reputable repair company to quickly respond to any issues. Finally, the value provided to customers is measurable in that customer repairs and/or replacement of equipment is covered up to $5,000 on an annual basis, with an additional $1,000 for electric line repairs. While there is a $60 deductible for each HVAC claim, the overall benefit is well above that offered by Agway’s EnergyGuard product," Vistra said

"Importantly, the Commission has already expressly recognized the Warranty Product structure as a compliant ERVAS, thus no additional in-depth review or determination is required here. In approving Agway’s EnergyGuard product, the Commission specifically noted the energy-related added-value that such warranty-type products provide to customers. Vistra is not proposing a new or different ERVAS structure. As such, a declaratory ruling is entirely appropriate to clarify that Vistra may provide customers with the Warranty Product once the product restrictions in the Second Reset Order take effect," Vistra said

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