New York Retail Suppliers Raise Concern on Cost Recovery of Generation to Replace Indian Point

Retail suppliers have raised concerns with the proposed method of cost recovery for any generation procured to replace the loss of the Indian Point capacity, if the New York nuclear plant is retired.

In response to a PSC directive (see prior story), ConEd and NYPA proposed transmission enhancements, and an RFP for potential generation solutions, to address reliability concerns resulting from the potential loss of Indian Point's 2,000 MW.

ConEd and NYPA proposed that costs of the various Indian Point contingency plans be recovered from individual LSEs. This would make ESCOs, along with the utilities for full service customers, responsible for payment of the charges, and collection of such costs from customers.

Retail suppliers protested such proposal, and instead said that the costs should be recovered from all distribution customers through the distribution side of the utility bill or other non-bypassable mechanism whose collection is not the responsibility of retail suppliers.

"The Commission should not apply cost recovery to all LSEs including ESCOs, in connection with customers that obtain delivery service from the utility," the Retail Energy Supply Association said. "[I]t is more reasonable for the Commission to allow for full recovery of the TOTS [transmission] and generation project charges as part of the utilities' delivery rates applied to all consumers (full service and those on retail access) which currently includes transmission, generation and distribution costs, or as an equal non-bypassable charge assessed to all consumers as part of the utility delivery rate structure."

Case 12-M- 0503