Massachusetts Sets Technical Conference on Lingering Purchase of Receivables Implementation Issues

The Massachusetts Department of Public Utilities has scheduled a technical conference regarding the still pending Purchase of Receivables compliance filings made by the electric distribution companies.

The technical conference is scheduled for December 17, 2012.

The DPU directed that, in advance of the conference, parties shall submit a report (jointly, if possible) by December 10, 2012, delineating the unresolved issues that remain in implementing the purchase of receivables programs.

Retail suppliers had requested a technical conference to assist in ongoing negotiations which have been "slow" and have thus far failed to reach a consensus resolution.

In a status reported filed in early November, TransCanada Power Marketing Ltd. and the Retail Energy Supply Association said that they were, "disappointed with the length of time that has passed since the Distribution Companies made their July 15, 2011 compliance filings with revised Terms and Conditions for Competitive Suppliers and a purchase of receivables ('POR') implementation plan."

TransCanada, RESA and Dominion Retail, Inc. collectively sent settlement offers to the Fitchburg Gas & Electric Light Company, d/b/a Unitil; Massachusetts Electric Company and Nantucket Electric Company, each d/b/a National Grid; NSTAR Electric Company and Western Massachusetts Electric Company on April 2, 2012 and again on or about August 1, 2012. "Although the parties made some progress on information requests over the course of the summer, negotiations on the competitive supplier agreements have been slow," TransCanada and RESA said.

TransCanada and RESA asked that the Department become involved, specifically through a technical conference, to help facilitate the negotiations regarding the competitive supplier agreements and settlement of certain other terms, including the timing of POR implementation.

The DPU in July had offered to "facilitate" settlement negotiations, in the interest of ensuring implementation of purchase of receivables "as soon as practicable."

"RESA suggests that, along with other issues, the technical session include the methodology to calculate a discount rate for existing receivables for NSTAR and WMECO. If the party-to-party negotiations are successful, then the technical session can be cancelled," the suppliers said.

TransCanada and RESA also suggested that the Department, at the end of the technical session (if it becomes necessary), set a procedural schedule to ensure that the negotiation process is completed as promptly as possible. "TransCanada and RESA submits that the procedural schedule should include a milestone that allows for a final order by the Department in this docket no later than December 31, 2012."

In addition, TransCanada and RESA suggested that the Department continue its involvement during the implementation phase of POR to ensure that the distribution companies and competitive suppliers are regularly communicating with respect to status updates and discussing any issues that are impeding progress. For example, the competitive suppliers may need to make technical changes to their systems in order to accommodate the changes that the distribution companies will be making to their systems. The department could play an important role to ensure that all parties are communicating and working at a reasonable speed to resolve issues and adhere to the deadlines set by the department, the suppliers said.