Central Hudson: Comparison of Prior ESCO Vs. Default Service Costs of "Limited Value"

Requiring distribution utilities to provide ESCO customers with a comparison of their costs under ESCO service versus shadow-billed default service costs would be of "limited value," Central Hudson Gas & Electric Corporation said in rebuttal testimony in a New York PSC proceeding reviewing its acquisition by Fortis Inc (12-M-0192).

As previously reported, PSC Staff had recommended that Central Hudson provide customers with the ESCO versus bundled service cost comparison on utility consolidated bills, through an online tool, and in response to certain customer calls and inquiries to Central Hudson.

In rebuttal testimony, Central Hudson said that, "The Company does believe that providing the historical comparison as recommended would provide ESCO customers with additional information with which to assess the results of their past decision to purchase energy supply from an ESCO. However, this historic comparison would be one dimensional in the sense that it would be a comparison against only one alternate supplier, Central Hudson. Additionally, the Company does not believe that such historic comparisons are necessarily indicative of future results and therefore not necessarily helpful to customers in making prospective energy supply decisions. As a result, the Company believes that such historic comparison would have very limited value in making the market for ESCO products more transparent and competitive."

Central Hudson noted that from approximately 1997 through 2004, an ESCO customer's bill did include the amount the customer would have paid for the current billing cycle had electricity and/or natural gas been purchased from Central Hudson. "This line item was removed in early 2004 in response to a request from Staff that the Company cease printing this comparison," Central Hudson noted.

Staff's recommendations, "focus on supplying information to assess a past decision to purchase supply from either the customer's current ESCO or Central Hudson, rather than supplying information across competitive options to assist in making informed prospective decisions," Central Hudson said.

With respect to the online ESCO versus default service bill comparison tool, Central Hudson already offers this tool, and has no immediate plans to alter the tool or modify its availability, the company said.

However, other recommendations from Staff, including listing the comparison on customer bills, would in the aggregate result in $15,950 in one-time expenses and an estimated $45,275 in annual on-going costs, based on current migration levels.

Central Hudson said that given that the PSC has opened a generic proceeding (12-M-0476) on retail market issues, including specifically ESCO versus utility cost comparisons, such proceeding is the proper venue for Staff's recommendations.