New York PSC to Review "Hedging" at Polar Vortex Technical Conference

"Hedging" has been included as a topic on the agenda for the previously reported May 15 technical conference that the New York PSC is convening on the polar vortex.

Specifically, one panel at the conference will be devoted to: "Electricity Prices, Gas Prices, Utilities, ESCOs and Hedging"

Previously, in temporarily capping the NiMo default service rate, the PSC said in January that, "Staff will be reviewing the reasonableness of National Grid's [default supply] procurement practices."

New York utilities currently have wide discretion to procure default service supplies, and while utilities actively hedge, they rely on significant short-term market purchases for mass market customers.

The PSC has a long history of investigating default service hedging, dating back to Case 06-M-1017, in which several "competitive" generators were urging the PSC to institute long-term contracting for default service procurements, "to limit consumers' exposure to excessive price volatility."