NEM: PSC Order Prohibiting ESCO Service To Low-Income Customers Will Violate APP Customers' Privacy

The National Energy Marketers Association sought rehearing of the New York PSC's July 15 order which prohibits ESCO service to Assistance Program Participant (APP) customers.

Apart from various legal deficiencies alleged by NEM, NEM notes that the July 15 order incongruously would violate APP customers' privacy, which the prohibition on ESCO service is ostensibly intended to protect (by rejecting alternatives allowing continued ESCO service but which would have revealed a customer's APP status)

"The July Order concludes that federal and state law prohibit social service agencies and utilities from sharing information about consumer public assistance status with ESCOs unless prior authorization is obtained. (July Order at 10). As a result, the Commission determined that ESCOs will not be provided with customers' APP status. (Id. at 11). Rather, the July Order adopts a mechanism whereby utilities will place a block on APP accounts from ESCO enrollments. The Order requires the utilities to notify ESCOs in sixty days which accounts they may no longer serve, and, 'the ESCO will not be informed that the customer is an APP, but instead will only be informed that a block has been placed on the account.' (Id. at 15)," NEM notes

"Despite the intent expressed in the Order to protect consumer privacy regarding APP status, the mechanism when put into practice will have the opposite effect. When the utilities send ESCOs the block information about their customers en masse in sixty days, the customers' low income status will be revealed. The Collaborative examined different methodologies by which ESCOs could be provided with customers APP status in a manner that respected consumer privacy. The Order failed to properly consider those alternatives that would have appropriately accomplished the objective," NEM said

NEM further noted that the Commission also failed to consider the low-income aggregation option presented in the APP collaborative report.

"This is remarkable in view of its decision to approve Community Choice Aggregation (CCA) for customers, which would operate in a similar manner to a low income aggregation program. In fact, utilizing the work that has already been done, a low income aggregation program could be implemented building upon the CCA model that was previously adopted. This seems particularly appropriate since the July Order allows low income customers to participate in CCAs," NEM said