Regulator Withdraws Prohibition On Retail Supplier Enrolling New Customers While Recent Acquisition Reviewed

The Connecticut PURA reiterated that the acquisition of Noble Americas Energy Solutions, LLC by a Calpine subsidiary, under which the acquired retail supplier was renamed Calpine Energy Solutions, LLC, constituted a transfer of a supplier license and required prior approval of the Authority, but PURA withdrew its earlier directive that Calpine Energy Solutions, LLC not enroll any new customers while PURA reviews the license transfer.

As previously reported by EnergyChoiceMatters.com, Calpine Energy Solutions, LLC had objected to PURA's finding that the acquisition constituted a transfer, and attendant prohibition on enrolling new customers by Calpine Energy Solutions, LLC during PURA's review of the transfer. Calpine Energy Solutions, LLC had argued that no license transfer occurred, as the Noble Americas Energy Solutions business was purchased in its entirety, and the entity holding the license has not changed (the company was simply renamed under the purchase).

"Calpine Corporation purchased the entire Calpine Solutions business including the legal entity, essentially as a 'stock purchase'. Calpine Solutions is materially the same company that has been operating in the State of Connecticut as an approved Electric Supplier since PURA first issued our retail license in 2003 in Docket 03-07-07. Our license was renewed in 2008 and was amended in 2011 for our name change from Sempra Energy Solutions to Noble Americas Energy Solutions (Docket No. 11-08-13). Other than corporate ownership, the technical, managerial and financial capability of Solutions these past 13-years has remained materially unchanged. We are the same company we have always been with no change in federal tax id and no change in D&B number," a Calpine representative said in an initial response to PURA.

However, PURA was not persuaded and reiterated in a response that the transaction constituted a license transfer.

"In the Authority’s view, this transaction is more than a mere change in name of the electric supplier. The 100% stock purchase of Noble by Calpine and/or its subsidiaries necessarily means that Noble’s electric supplier must be transferred to the new owner. The Authority must adhere to §16-245(j) of the General Statutes of Connecticut, which provides that '[n]o license may be transferred without the prior approval of the authority.' Separate legal entities may not successfully avoid this legislative mandate by merely claiming the name of Noble was changed to Calpine. See Vogel v. New Milford, 161 Conn. 490, 497-98 (1971)," PURA said

Notwithstanding, the Authority amended its prior directive, and will conditionally allow Calpine Energy Solutions, LLC to enroll new customers based on Calpine Energy Solutions, LLC's representation that it is materially the same company that has been operating since it was first issued a retail electric supplier license.

"As explained above, however, the Authority maintains that this transaction involves a transfer of license. Consequently, the Authority intends to review the underlying transfer as part of Noble’s license five-year review. Should the Authority deem that Calpine lacks the financial, managerial, or technical capabilities necessary to maintain an electric supplier license as part of the review, Calpine’s customers will be returned to standard service," PURA said