NRG: ESCOs Should Not Be "Learning On The Job," Proposes Stricter Eligibility Requirements

The NRG Energy retail companies welcomed proposed stricter ESCO eligibility requirements in New York, recommending even stricter requirements, stating, "ESCOs should not be 'learning on the job.'"

As previously reported, Staff has proposed that ESCOs offering one or more fixed price products would be required to possess, "at least three years of experience in energy commodity risk management." All ESCOs would be required to possess at least three years of customer service work experience.

"NRG Retail supports Staff’s initiative to strengthen the eligibility criteria for ESCOs. Provision of electricity and natural gas supply is an essential service to millions of New York energy customers. The companies entrusted by the Public Service Commission ('Commission') to supply this vital service should be held to correspondingly high standards of financial fitness, operational competency, and managerial capability and experience. Rigorous eligibility requirements can help improve the caliber of market participants and thereby the overall performance of the retail energy market in New York," NRG said.

"ESCOs should not be 'learning on the job.' NRG Retail recommends that ESCO applicants be required to demonstrate at least three (3) years of experience by key management personnel in the critical areas of commodity markets risk management, energy supply operations, customer service and complaint handling, sales quality assurance, Operations/IT, sales and marketing. ESCOs should also be required to demonstrate capability to provide a consolidated bill," NRG said.

Note that NRG's recommendation goes beyond the Staff proposal which had limited the required risk management experience to ESCOs offering fixed price contracts. Additionally, the Staff proposal did not propose a minimum level of experience with "energy supply operations", Operations/IT, or sales and marketing as suggested by NRG

"Applicants should be required to provide a biographical summary of key managerial personnel representing at least three (3) years of experience in each discipline listed above. The qualifications of an ESCO’s partners or vendors which provide key services related to eligibility requirements may satisfy the expertise requirement," NRG said.

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