New Rules Requiring Retail Suppliers To Maintain Additional Security To Cover RPS Obligations Receive Final Approval, Take Effect -- EnergyChoiceMatters.com

New Rules Requiring Retail Suppliers To Maintain Additional Security To Cover RPS Obligations Receive Final Approval, Take Effect

December 27, 2022

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Copyright 2010-21 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

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The Connecticut PURA issued a notice stating that revised RPS rules, which include a new requirement that retail electric suppliers must maintain separate security specific to their RPS obligations, have completed the administrative process.

The new RPS rules are effective December 27, 2022

As exclusively reported in EnergyChoiceMatters.com, PURA had adopted language for the new rules this summer, and the rules then worked their way through the non-PURA administrative review process.

The final adopted rule provides, "Renewable Energy Portfolio Standards Security. (1) In addition to the security required by section 16-245-4 of the Regulations of Connecticut State Agencies, each electric supplier shall maintain a renewable energy portfolio standards security with the Authority equal to the full alternative compliance payment that the electric supplier would be required to pay to the Authority pursuant to section 16-245(k) of the Connecticut General Statutes based on the forecast year load."

Under the final rule, "The forecast year load shall be the amount of the full load served by the electric supplier during the previous calendar year, as adjusted to account for changes in the type and quantity of customers to be served in the forecast year."

Under the final rule, "security" means, "a bond, letter of credit, guarantee, or other appropriate financial instruments approved by the Authority from a creditworthy financial institution."

The final rule provides that a new supplier that was granted a license by the Authority pursuant to section 16-245 of the Connecticut General Statutes during the previous calendar year shall maintain a renewable energy portfolio standards security in the amount of twenty five thousand dollars ($25,000) or in an amount equal to the full alternative compliance payment for such electric supplier’s projected load for its first year of operations, whichever is greater.

The final rule requires that, annually, an electric supplier shall review the amount of its RPS security.

Under such annual review, if the amount of the electric supplier’s RPS security is insufficient to pay at least ninety per cent of the full alternative compliance payment that the electric supplier would be required to pay to the Authority pursuant to section 16-245(k) of the Connecticut General Statutes based on the forecast year load, the electric supplier shall increase the RPS security to an amount sufficient to pay the full alternative compliance payment obligation due for the forecast year load

The above-described requirements to maintain an RPS security do not apply to wholesale suppliers providing generation supply to electric distribution companies for standard service load

The final rule also alters the RPS banking language

The final rule states, "An electric distribution company or electric supplier may bank renewable energy certificates in one year to comply with the renewable energy portfolio standards in either of the following two years, provided the electric distribution company or electric supplier, as applicable, has complied with the renewable energy portfolio standards in the year in which the electric distribution company or electric supplier wants to bank the renewable energy certificates."

The existing banking percentage limits remain

With respect to other new provisions, the final rule provides that an electric supplier shall be responsible for independently managing its NEPOOL GIS renewable energy certificate accounts throughout the year. "The Authority shall not accept or review a request from an electric supplier to reallocate renewable energy certificates into or out of the electric supplier’s NEPOOL GIS accounts or subaccounts, or both," the final rule states

The final rule provides that, "Electric distribution companies shall make available to an electric supplier the electric supplier’s monthly load settlement data. Each electric distribution company shall submit to the Authority and each electric supplier, on or before the date published by the Authority in its annual notice of the renewable energy portfolio compliance docket, a report on a form prescribed by the Authority that summarizes the electric supplier’s monthly and total load settlement data for the previous calendar year."

Consistent with recent statutory changes, the final rule eliminates the provisions that had allowed electric distribution companies and electric suppliers to make up a deficiency in an annual renewable portfolio standard (RPS) obligation in the first three months of the following calendar year

Docket No. 19-10-26

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