Maryland Staff Suggest that Universal Service Program Customers Be Informed of Competitive Supply Options

Maryland's Office of Home Energy Programs of the Department of Human Resources (OHEP) should inform Electric Universal Service Program (EUSP) participants about their opportunities to take service from competitive suppliers, Maryland PSC Staff recommended in comments on OHEP's FY 2013 EUSP plan, with Staff also recommending continued monitoring so that EUSP payments are properly applied to competitive supply receivables.

"It has been Staff's long-standing concern that, as implemented, EUSP participants have been unable to benefit fully from competitive commodity rates that may be offered by retail suppliers. Staff believes that low-income customers should not be foreclosed from electing to receive commodity service from competitive suppliers and that OHEP participants should be allowed to benefit from the lower rates offered by these suppliers," Staff said.

Staff noted that OHEP has tried to clarify OHEP's position regarding retail supply in the FY 2013 Proposed EUSP Plan.

Specifically, OHEP's plan states: "Customers who have elected to purchase electricity from a supplier other than their electric utility shall be eligible to receive Bill Payment Assistance and Arrearage Retirement benefits as long as they meet the eligibility requirements. There should be no adverse effect upon the customer's bill by participating with a licensed energy supplier. With electric utilities purchasing the receivables of electric suppliers, the outstanding balance belongs to the utility."

Staff agrees with OHEP that this policy should work not only for bill assistance but also for arrearage retirement. Staff noted that this matter continues to be discussed within the Electricity Supplier Coordination Tariff Working Group because there are various technical billing details specific to each utility (discussed further below).

Staff noted that electricity commodity rates are continuing to decline, and some electricity suppliers are able to offer customers a material discount from standard offer service (SOS) rates.

"Staff suggests that OHEP should be directed to inform EUSP participants about their opportunities to take service from competitive suppliers."

Accordingly, Staff recommended that the PSC direct OHEP to monitor the process by which supplier receivables purchased by utilities are applied to the customer's full bill as it pertains to EUSP benefits, and "consider requiring OHEP to inform EUSP participants about their opportunities to take service from competitive suppliers."

Regarding the above-noted billing issues, Washington Gas Energy Services described several issues in separately filed comments:

"Maryland's investor-owned electric utilities generally do not apply energy assistance grants to supplier charges unless persuaded to on a customer-by-customer basis; however, not all of the utility companies will agree to do so. Additionally, the utilities that agree to apply energy assistance funds to supplier charges seem to have technical difficulties that lead to monthly billing problems. For example, in the past WGES has worked to persuade BG&E that energy assistance funds should be applied to supplier charges, and that company has done so for individual customers on whose behalf WGES contacted the utility. Even in cases like this, however, BG&E's billing system usually will not automatically apply the energy assistance funds to supplier charges for the next month. As a result, WGES generally releases the customer to avoid continued billing problems. Pepco generally refuses to apply energy assistance funds to the customer's entire bill at all. Further, some customers receive inconsistent information from their electric company regarding whether they can choose a retail supplier and still receive energy assistance benefits. This causes customer confusion and alarm. As a result, WGES avoids serving customers who receive energy assistance benefits, even though WGES's rates may be lower than the utility's SOS rate," WGES said.

"WGES urges the Commission to clarify that customers receiving energy assistance benefits should have the ability to shop with retail energy suppliers. The utility companies should be able to make the necessary adjustments to their billing systems at no charge to suppliers."