New York Utilities Balk At Purchasing Receivables (POR) Of ESCO Value-Added Products, Want Issue Considered Under Track II Retail Market Review Other Issues For Track II Set At Kick-off Meeting

August 20, 2021

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Reporting by Paul Ring • ring@energychoicematters.com

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During a Department of Public Service stakeholder meeting, a representative of several New York utilities balked at purchasing the receivables of ESCOs for non-supply, energy-related value-added products and services (ERVAS), and said that the issue of POR for ERVAS should be considered in Track II of the PSC's retail market review

The stakeholder meeting initiated Track II of the PSC's retail market review to assess whether new ESCO rules and products can be developed that would provide sufficient real value to mass-market customers such that new products could be provided to those customers by ESCOs in the future and in a manner that would ensure just and reasonable rates.

The representative from several utilities said that the utilities would only expect to pay POR on the supply itself

ESCO representatives raised concern with the stance, especially with respect to energy-related value-added products and services for which the PSC has already given approval. ESCOs noted that the PSC could have expressly limited (and did not) POR related to energy-related value-added products and services in the prior orders authorizing ESCOs, on a generic basis (subject to DPS Staff review of terms and conditions), to offer certain ERVAS products (such as home warranty products). An ESCO representative also felt consideration of the POR issue was expanding the scope of the collaborative

A representative from DPS Staff agreed that the issue is something that should be considered and said that it has recently come up in context of the existing ERVAS products.

Somewhat related is the PSC's direction that Track II shall address the PSC's directive that pricing for ERVAS products shall be transparent, including the ability to identify the portion of the total ESCO bill that is attributable to commodity and the portion that is attributable to the energy-related, value-added product or service.

The PSC has previously ordered that this directive requires an, "on-bill price comparison and unbundled bill structure."

Whether current utility billing systems can accommodate this transparency requirement, and any potential modifications needed, will be an issue in Track II, including whether this directive is implemented as a line-item break-down on bills.

A representative for small consumers said that ESCOs should pay for any necessary billing upgrades

A representative from DPS Staff noted that while the PSC has issued a directive for transparency, there has been no prior directive from the PSC that ESCOs should pay for utility costs related to this issue

Other issues that will be addressed in the collaborative, as set in the initial meeting, are issues related to:

• Green natural gas, including verification

• Definition of small non-residential customers, including using a rate class definition versus a volumetric definition, and the issue of incidental residential accounts

• Issues related to the state's Integrated Energy Data Resource (IEDR) as applicable to ESCOs and ESCO service

An ESCO representative raised concerns that it appears, to some ESCOs, that there may be disparate treatment at the DPS of ESCOs. The comment was made in terms of approving ESCOs' ERVAS products (those already approved on a generic basis but subject to T&Cs review by DPS Staff). An issue was also raised concerning the "shuffling" of a type of product receiving approval, but then later the approval was rescinded.

A DPS Staff representative stressed that Staff's goal is to always be consistent with all companies. A DPS Staff representative said that Staff is working through issues stemming from the PSC's order, with the attendant growing pains, the same way that ESCOs are

A DPS Staff representative said that Staff is always appreciative of feedback if there is an apparent mistake or similar issue, so that the issue can be addressed. A DPS Staff representative said that Staff aims to be available and responsive

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