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New York DPS Staff Straw Proposal Would Allow Municipal Aggregations To Enroll ESCO Customers Into CCA Community Solar On Opt-out Basis

March 30, 2022

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Copyright 2010-21
Reporting by Paul Ring •

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New York Department of Public Service Staff have filed a straw proposal that would establish terms for allowing municipal aggregations (CCAs) to provide community distributed generation (CDG) to customers on an opt-out basis

Notably, the straw proposal would allow municipal aggregations to enroll current ESCO customers into the CCA's CDG aggregation on an opt-out basis

Specifically, Staff's straw proposal recommends that, in addition to those customers currently permitted to be enrolled into a municipal aggregation for energy supply on an opt-out basis, the following additional customers shall also be eligible to be enrolled into a CCA's community distributed generation program on an opt-out basis:

• Customers who are being served by an ESCO.

• Customers with energy service company (ESCO) blocks on their utility accounts; and

• Time-of-use or time varying rate customers;

• Assistance Program Participant (APP) customers;

As noted, these types of customers listed above may not be enrolled in a CCA's energy supply program on an opt-out basis

"Staff recommends that the following mass-market customer types, who would be excluded from the eligible list for a CCA supply program according to the current CCA Rules, be eligible for participation in an opt-out CDG program. The CCA Framework Order specifically prohibited CCA supply program enrollment of the below customer types because there wasn’t a comparable product offering, enrolling them would interfere with a choice the customer has already made, or, in the instance of APP customers, serving ESCOs were unable to meet the necessary requirements to receive approval for a guaranteed savings supply product as required by the Commission. These customer type exclusions are specific to ESCO supply products and should not be applied to eligibility rules for a CDG product offering. Thus, Staff recommends that the following customers, who are ineligible to be opt-out enrolled in CCA supply, be eligible for opt-out enrollment in CDG," the straw proposal states

Under the straw proposal, the following customers will continue to be ineligible to receive CDG memberships on an opt-out basis.

• Customers with net meter on-site projects;

• Customers who are already participating in CDG;

• Customers with less than 1000 kWh of annual usage;

• Customers allocated by the utility to a CDG project with a near term commercial operation date; and

• DER blocked customers.

Staff recommends that APP customers be prioritized for enrollment and first subscribed within a municipality’s opt-out CDG program

For CCA opt-out CDG programs, Staff recommends that the 5% minimum discount for non-APP customers be maintained, and a minimum discount of 10% be established for APP customers

Concerning CCA administrator fees, Staff noted that the existing Commission defined rules for Administrator Fees applicable to CCA supply programs would not be applicable as there is no ESCO or supply product offering to build the fee into or to perform the necessary collection and remittance roles.

Staff therefore recommends that:

• CCA Administrator fees for opt-out CDG be paid exclusively by the CDG project owner(s) serving the CCA. Administrators, and their subcontractors or partners, should be barred from collecting fees or any other payment from municipalities, customers, or other parties for the purpose of administering an opt-out CDG program.

• CCA Administrators may collect fees on either an upfront (prior to project operation) basis, and ongoing (monthly, annually, or some other period) basis, or some combination thereof.

• Fees can be calculated on % basis, a per Watt/per kWh basis, a per customer basis, or on some other reasonable basis.

• CCA Administrators must clearly present their proposed fee structure in proposals to municipalities, and in Municipal Implementation Plans. This must include the method by which fees will be calculated (e.g., % basis, per Watt basis) for upfront and/or ongoing fees, and an estimate of the monetary ($) equivalent of those fees, made using the Value Stack Calculator if fees will be calculated on a % basis. For example, if a CCA Administrator estimates that they will procure 50 direct current megawatts (MWdc) of CDG for a CCA and proposes to charge fees of $.02/Watt DC upfront and $.001/Watt DC annually, they must indicate that upfront fees will total an estimated $1,000,000 and ongoing fees will be an estimated $50,000 per year.

• CCA Administrators must clearly present the intended milestone for payment of upfront fees, such as at contract signing by CDG owner(s) or upon allocation of customers to CDG projects. All procurement and contracting documents between parties must hold harmless municipalities in the event of nonperformance by either party to ensure that municipalities are not liable for the recovery of any upfront fees.

• Administrator reporting must include fees collected during that period and cumulatively.

Case 14-M-0224 et al.

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