New Hampshire Staff Asks PUC to Issue Show Cause Order to Retail Supplier and Aggregator Concerning Revocation of Licenses

Staff of the Public Utilities Commission of New Hampshire has requested, "that the Commission immediately schedule a hearing at which Resident Power, LLC (Resident Power) and PNE Energy Supply, LLC (PNE) both appear to show cause as to why they should not be subject to penalties or their registrations to operate as an aggregator and a competitive electric power supplier (CEPS), respectively, should not be revoked or suspended in accordance with N.H. Code Admin. Rules Puc 2005."

In a memo dated February 27, Staff alleged that it has, "identified the following rules which it believes may have been violated by PNE and/or by Resident Power:

• "2003.01(d)(2) Evidence that the CEPS is able to obtain supply in the New England energy market. Such evidence may include, but is not limited to, proof of membership in the New England Power Pool (NEPOOL) or any successor organization, or documentation of a contractual relationship with a NEPOOL member.

• "2003.01(i) Following registration, a CEPS shall continue to maintain compliance with the requirements of Puc 2000.

• "2004.05(m) The CEPS shall provide a copy of the notice described in (1) above to the commission at the same time notice is sent to affected customers.

• "2004.07(f) Any CEPS that ceases to sell electricity within the state shall, prior to discontinuing such service: (1) Provide at least 30 days written notice to any affected utility and to the commission; and (2) Provide each customer written notice of its intent to cease operations at least 30 days prior to the start date of the customer's next billing cycle.

• "2004.08 (a)(2) Provide notice to customers of the nature of any business relationships or affiliations with any CEPS or utility."

"In addition to the rules listed above, Staff also notes that, in accordance with 2006.01(a)(11), PNE's application stated it intended to serve only residential customers. Reports filed in accordance with Puc 2003.03 (b) indicate that PNE has been serving non-residential customers since the fourth quarter of 2011, the first quarter following approval of PNE's registration as a competitive electric power supplier by the Commission," Staff alleged.

"Staff requests this joint hearing partly due to recent events that have occurred, and that continue to develop, that involve business and ownership relationships between the two entities that are so intertwined that attempting to investigate the companies separately would result in an unnecessarily complicated process. Due to the overlapping facts and circumstances that have resulted in this recommendation, Staff believes that having a combined hearing would be the most efficient and expeditious process."

A representative of Resident Power denied all of the allegations in a statement to the Nashua Telegraph, stating that Staff, "has been given misinformation by third parties."

Staff's request comes in response to the default of PNE Energy Supply at ISO New England, and subsequent events. Staff described PNE and aggregator Resident Power as, "affiliates with common ownership."

Prior to the default, Staff said that a PNE notice to customers dated February 11, 2013 concerning the sale of the PNE customers to FairPoint Energy (in process at the time of the PNE default), "stated that Resident Power would no longer be an aggregator for those customers, except to cooperate with FairPoint to assist in the transition between electricity suppliers."

After the PNE default, which dropped the majority of customers to default service prior to the switch to FairPoint, Staff said that a February 21 Resident Power notice to customers, "recognizes this and asks the customer to affirmatively renew his or her account with Resident Power, indicating that if the customer does not renew with Resident Power, he or she will remain on PSNH's default service rate until another supplier is chosen."

However, Staff said that Resident Power's February 22 petition for declaratory judgment (click here) asks the Commission to make a ruling as to whether the Resident Power agreements with former PNE customers are valid and, therefore, any action by Resident Power to change the supplier of former PNE customers would not constitute slamming, "something which seems contradictory to the notice provided by Resident Power the previous evening."

Staff also noted that the PUC received a filing on February 19 from PNE stating that PNE would be voluntarily ceasing operations as a CEPS for a redacted period of time.

"To date, documents have been issued by PNE or Resident Power indicating, among other things, that Resident Power is either no longer the aggregator for the former PNE customers, still their aggregator, or that those customers can 'renew' their aggregation relationship with Resident Power. Representatives of PNE and Resident Power alternately seem to speak for one entity, the other or both, but at other times appear to fall back to relying on the companies' statuses as separate legal entities to disclaim knowledge of each other's actions. Customers, Staff and the general public are getting confusing and conflicting information, which continues to change over time," Staff said.

"Staff recommends that the Commission have PNE and Resident Power appear before it to answer the numerous questions generated by their recent actions. Toward that end, Staff recommends that the Commission schedule a show cause hearing as soon as practicable," Staff said.

"In addition, considering PNE's current lack of status as a market participant with ISO-NE and its voluntary suspension of operations in New Hampshire, Staff recommends that the Commission order that PNE cease enrolling new customers, to the extent it has not already done so, and that the New Hampshire electric utilities not be required to accept any customer enrollments from PNE, to the extent they receive any," Staff said.

Staff alleged that on February 21, 2013, "it was brought to Staff's attention that PNE was in the process of enrolling a large commercial and industrial customer, despite a) PNE having previously been suspended as a market participant by ISO-NE, b) having informed the Commission that it would be voluntarily ceasing operations beginning [on a date redacted in Staff's memo]."

PNE specifically denied this allegation as untrue in a statement to the Nashua Telegraph.