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Broker/Aggregator Says PUC Staff Has Said That Broker/Aggregator Is Subject To Financial Security Requirements For Licensure (Novel Position From Staff?), Applicant Seeks Contrary Finding, Or Waiver
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PowerOptions, Inc., which as previously reported is seeking a Maine electric aggregator/broker license, has said in a Maine PUC filing that Maine PUC Staff has indicated that PowerOptions, which has amended its application to include aggregation service to residential customers, will be subject to the financial security requirements of Section 2(B)(3) of Chapter 305 of the Commission’s Rules.
PowerOptions sought a ruling from the PUC that such financial security requirements are not applicable to aggregators and brokers, or alternatively, that the PUC should grant a good cause exception from the security requirements
PowerOptions' representation of Staff's position is notable, because, based on ECM's review of several broker/aggregator applications over the past two years, it does not appear that the PUC has been requiring broker/aggregator applicants to provide the financial security under Section 2(B)(3) of Chapter 305. It is unclear if Staff's position, as represented by PowerOptions, is new, or reflects a unique application due to PowerOptions' specific proposed services, or potentially reflects a misunderstanding of PowerOptions' proposed services
ECM's review included brokers/aggregators which had sought to specifically serve residential customers, as well as small non-residential customers. Although certain filings may be confidential, ECM's review of such broker/aggregator applications generally showed that such mass market broker/aggregator applicants left the relevant section of the application related to financial security blank, checked a box for "no security required", or wrote "not applicable". The subsequent PUC orders which granted the applications made no specific mention of whether security had been provided or was required
Indeed, the section of the application requiring applicants to list the type of security that the applicant will provide states that the section is, "required from all competitive electricity providers to offer supplier service" [emphasis added]. As noted below, the term supplier service is used the same as "generation service", with, as noted below, mass market generation service being the trigger for the security requirement
Notably, the PUC's application for a, "license as a competitive electricity provider" includes three categories of such providers: (1) "Aggregator/Broker (Includes Marketers)", (2) "Standard Offer Provider", or (3) "Competitive Electricity Provider (Generation/Supplier Service)". The Competitive Electricity Provider (Generation/Supplier Service) category is the designation for load-serving retail suppliers
As shown above, the Aggregator/Broker (& Marketer) category does not distinguish between brokers and aggregators, and there is no separate aggregator license
As such, PowerOptions' specific proposed service, which is generally aggregating customers for buying pools, should not be distinct with respect to financial security requirements versus other recent Aggregator/Broker applicants
However, in addition to the standard category question, applicants must also provide, "A generic list of products and
services that Applicant will
market or offer in Maine."
It is unclear if PowerOptions' specific response to such question prompted Staff's purported position that financial security is required
PowerOptions' narrative concerning its proposed services does reference that PowerOptions will be negotiating with suppliers on behalf of customers, and conducting solicitations
However, certain language used by PowerOptions, when read in haste or a vacuum, could be read as PowerOptions providing actual supply products to customers, rather than procuring supply service.
Specifically, PowerOptions had said that it, "plans to offer the following electricity supply products to customers in
the State of Maine," with PowerOptions then listing:
Fixed Price Electricity Service – PowerOptions would provide a single price with all
electricity supply components locked-in for the duration of the agreement.
Indexed Pricing – PowerOptions would allow customers to fix or pass through any
combination of indexed or non-indexed variable rates or charges. This would allow
customers to customize their electricity product to manage costs such as capacity
or energy costs through hedging or building management strategies.
Renewable Energy Credits (RECs) – Customers can purchase either load-following
RECs or standalone RECs alongside their electricity supply. PowerOptions’
electricity supplier will provide documentation certifying that the RECs meet Greene or Maine RPS standards with all GIS registration information as require
While it is clear from PowerOptions' entire application that PowerOptions' offering of such products would be as an aggregator sourcing these products from a retail supplier, it could be that Staff is reading such language as PowerOptions itself providing "electricity supply products".
Otherwise, based on past precedent, ECM does not understand the genesis of Staff's position that PowerOptions is required to provide financial security, aside from the position being novel. Staff has not filed any public positions concerning PowerOptions' application, and Staff's position is solely gleaned through PowerOptions' representation of such
PowerOptions argues that the PUC's rules do not require Aggregators/Brokers to provide security.
Specifically, Section 2(B)(3) of Chapter 305 provides that, "The financial security requirements of this paragraph apply only to
Applicants that seek a license to provide Generation Service to
residential and small non-residential customers."
The rule provides for a minimum security amount of $100,000 initially, but the rule provides that the required security amount
will change each year and must equal 10 percent of the licensee’s annual
revenues from sales of generation services to Residential and Small Non-
residential Customers in Maine over the prior calendar year, or
$1,000,000, whichever is lesser. The rule allows the PUC to change the security amount commensurate with the nature and
scope of the business that the licensee anticipates conducting in Maine
As noted above, the rule applies the security requirement to licensees that provide, "Generation Service".
PowerOptions noted that Chapter 305
defines generation service as, "the provision of electric power to a retail customer through a
transmission and distribution utility but does not encompass any activity related to the
transmission or distribution of that power."
PowerOptions said that Chapter 305 recognizes in multiple instances that broker or aggregator services are distinct from generation service
"Accordingly, Section 2(B)(3) of Chapter 305 does not require PowerOptions to
provide financial security because PowerOptions will not provide generation service to
residential and small non-residential customers," PowerOptions said
PowerOptions argued that such position is supported by the history of the rule
PowerOptions said that, when initially promulgated,
Chapter 305 expressly excluded aggregators and brokers
from the requirement to provide financial security.
While the specific language excluding brokers/aggregators was omitted in a rule update initiated in 2005, PowerOptions said that, in adopting the revised rules, the PUC specifically stated
that the revised rule, "maintains the requirement in the current rule that applicants that will
provide generation service to residential and small non-residential customers must post financial
security in the amount of $100,000."
PowerOptions said, "The Commission went on to state, with respect to the
financial security requirement, that it only intended to change the acceptable form of security to
reflect current industry practice. The rulemaking did not discuss expanding the requirement to
brokers and aggregators. The Commission did not intend for the modification from expressly
excluding brokers and aggregators to the current rule to substantively change the applicability of
the financial security requirement. Rather, as the Commission held in Docket No. 2005-00608,
the change effectuated the removal of unnecessary language that was in the rule at the time."
PowerOptions noted that small non-residential and
residential retail customers who use PowerOptions will, "have entered directly into electricity supply
contracts with a generation service provider and, on a going forward basis, will continue to enter
into electricity supply contracts directly with generation service providers selected by
PowerOptions during the competitive procurement process."
PowerOptions in its request also disclosed that PowerOptions intends to assume the services and obligations of
the Maine PowerOptions (MPO) aggregation program, a currently unaffiliated program run by the Maine Health and Higher Educational
Facilities Authority (MHHEFA) and Maine Municipal Bond Bank (MMBB)
MHHEFA and MMBB are seeking to wind down their aggregation program, PowerOptions said
Docket 2025-00283
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October 14, 2025
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Copyright 2025 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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