PSC Weighs Utility's Application To Offer Green Option Under Default Service, Holds Consideration

The Maryland PSC at its administrative meeting yesterday considered the application of Southern Maryland Electric Cooperative, Inc. to implement a proposed new rider, Rider SOS-G, which is, "intended to provide SMECO members who take SOS service the option to have SMECO make the power supply for their load one hundred percent 'green.'"

EnergyChoiceMatters.com exclusively first reported SMECO's proposed green SOS rider, see our prior story for details

As proposed, the rider will charge the members the additional cost for meeting that 100% green requirement above the regular SOS rate in effect. Members who choose the Rider will continue to pay the base SOS rate and the PPCA rate for their power supply and will be billed the Rider SOS-G rate as well.

The PSC did not vote on the tariff at the meeting, and scheduled to again consider the matter at its August 19 meeting

The PSC heard from parties and weighed issues including whether the product conformed to statutes concerning SOS for a cooperative, and, if so, would SMECO's proposed communications concerning the green SOS rider constitute permissible informational communications, or impermissible marketing of SOS

Commission Staff had recommended that the Commission deny the proposed tariff filing.

Among other things, Staff cited PUA § 7-510(c)(8), which permits an electric cooperative to use a "blended portfolio" in a "cost-effective" manner

Staff argued that one interpretation of this statute would preclude a cooperative from offering to its customers an additional type of SOS service that adds RECs to create a green SOS product. "Mixed SOS products that add a REC component to make a green SOS service would not be allowed, as this would not constitute SOS under the statute’s definition, because the statute has no provision for optional products. In addition, a 'green' SOS may not be cost-effective, if it represents a cost greater than that economically obtained because it includes more RECs than required by law," Staff had said in written comments

Staff further noted, "SMECO has indicated that it would notify its customers of the availability of its SOS-G optional service by an informational bill insert and an email, and will have a web page describing the service. This promotion of its SOS-G may violate COMAR 20.40.02.01B(7), which prohibits the marketing of SOS, and the Settlement and Stipulation Agreement of Case No. 8985. Because COMAR permits a utility to provide unbiased information about the availability and terms of SOS, a determination is needed of whether SMECO would be marketing or providing biased information about SOS. The Cooperative has not provided its customer information about its proposed Green SOS at this time."

RESA also opposed the tariff

The tariff was supported by the Sierra Club-Southern Maryland Group and OPC, in addition to SMECO

A full report concerning Commissioners' comments during the meeting will follow