Pa. PUC Staff: Low-Income Assistance Customers Should Be Prohibited From Shopping At EGS Rate That Exceeds Price To Compare "At Any Time"

The Pennsylvania PUC's Bureau of Investigation and Enforcement has recommended that Customer Assistance Program (CAP, or PCAP) customers at the FirstEnergy EDCs be prohibited from shopping for electricity rates that exceed the EDCs' Price to Compare, "at any time."

This recommendation goes beyond the current prohibition on CAP shopping at PPL, where shopping may only occur through a CAP-specific Standard Offer program, where the initial price must be at a 7% discount to the PTC at the time of enrollment, but with such initial price being fixed for 12 months (and therefore may exceed the PTC over time depending on changes to the PTC)

Currently, CAP customers at the FirstEnergy EDCs may shop for an electric generation supplier (EGS) with no limitation

In a post-hearing brief on the FirstEnergy EDCs' default service plan, I&E said, "the record in this case revealed that, over 55 months, over $17 million in excess CAP shopping costs were being incurred within the Companies' service territories as a result of CAP customers shopping for rates that exceeded the Companies' PTC."

"[T]he Companies' data revealed that during the same 55-month period, an average of 63%, 62%, 65%, and 72% of Met-Ed, Penelec, Penn power [sic], and West Penn Power customer [sic] paid rates that exceeded the Companies' PTC, respectively," I&E said

"I&E submits that the Companies do have a mandate to restrict the scope of CAP shopping under certain circumstances. Chief among these circumstances, and pertinent to this case, is the necessity to restrict CAP shopping when evidence proves that escalated costs have resulted from the Companies' unrestricted CAP shopping program and access to and affordability of electricity service is compromised," I&E said

"For this reason, and in conjunction with the Companies' obligations to appropriately fund cost-effective universal service programs, I&E recommended that the Companies mitigate CAP shopping costs by prohibiting CAP customers from shopping for electricity rates that exceed the Companies' PTC at any time," I&E said

I&E said, "The Choice Act acknowledged the necessity of electric service as 'essential to the health and well-being of residents, to public safety and to orderly economic development.' Because electric service is a necessity, the Choice Act concluded that all customers should be able to obtain service on 'reasonable terms and conditions.'"

"The Choice Act also highlighted the need to protect low income customers, mandating that '[t]he Commonwealth must, at a minimum, continue the protections, policies and services that now assist customers who are low-income to afford electric service,'" I&E said

"To ensure the protection of low income customers, the Act mandated that the Commission ensure that universal service and energy conservation policies, activities and services are appropriately funded and available in each EDC's territory," I&E said

"At a minimum, the plain language of the Choice Act imposes an obligation upon the Commission to ensure that ratepayers are receiving electric service on reasonable terms," I&E said

"I&E submits that the PCAP shopping data revealed by the Companies proves that unrestricted PCAP shopping in their service territories has produced results that are unreasonable and have jeopardized access to electric service for some low-income customers," I&E said

Regarding I&E's recommendation that CAP customers be prohibited from shopping for an electric rate that exceeds the PTC, "at any time", I&E said that a PPL-style CAP-SOP would not be appropriate at the FirstEnergy EDCs

"As the proceeding progressed, the evidence submitted by OCA witness Alexander and CAUSE-PA witness Geller convinced [I&E] witness Keller that a program modeled after the PPL CAP-SOP would not translate well to the Companies, as the Companies' PTC has proven to be far more volatile than PPL's PTC and therefore would not demonstrate cost savings," I&E said

I&E's, "ultimate recommendation is that the Commission order the Companies to develop a program that would prohibit PCAP customers from shopping for electricity where rates are greater than the Companies' PTC at any time throughout the term of the agreement."