New York DPS Staff Proposes Requiring Utility To Verify That ESCOs Serving Non-Core Customers Have Firm Primary Point Capacity To The City Gates

Staff of the New York Department of Public Service have recommended in testimony in a Niagara Mohawk (NiMo, NMPC, or National Grid) rate case that NiMo, "be required to implement a process to verify that direct non-core customers or the ESCO’s or marketers serving non-core customers have firm primary point capacity to the city gates so that non-core customer requirements are properly being met."

Staff was responding to a NiMo proposal, exclusively first reported by EnergyChoiceMatters.com, to close its non-core daily balancing transportation service to new customers, and to offer a new core daily balancing transportation service, which will require that ESCOs take released capacity associated with such core daily balancing customers

Staff opposed NiMo's proposal on several grounds, noting that the NiMo's proposal tacitly redefines non-core customers as core and does not comply with the existing Commission policy (which defines core customers as being residential and small commercial customers, which at NiMo are full service sales and monthly-balanced transportation customers).

Staff further said that NiMo's proposal would, as previously reported in our prior story, allow the Company to allocate and release capacity assets held on behalf of core customers to the ESCOs serving any new non-core customer participating in the proposed core daily balancing transportation service.

"This would reduce the capacity assets that are available for the needs of demand growth of both existing and new core customers," Staff said

Staff instead said that NiMo should be required to implement a process to verify that direct non-core customers or the ESCO’s or marketers serving non-core customers have firm primary point capacity to the city gates so that non-core customer requirements are properly being met.

"Specifically, the Company should require all direct firm non-core customers or their agent and all marketers serving firm non-core customers to submit to the Company, by July 1st of every year, capacity contracts, redacted as appropriate, showing firm primary point capacity to the Company’s city gates for the firm non-core customers’ supply requirements for the upcoming heating period. In lieu of a redacted contract, the customer, agent or marketer may file an affidavit stating that they have the required firm primary point capacity to their required city gates for their specific customer supply requirements," Staff said

"This verification process has been successfully used by other utilities in the State such as NFG [sic]. It is described in NFG’s publicly available Gas Transportation Operating Procedures Manual," Staff said

"Implementing a verification process would allow NMPC to identify any bad actors on its system improperly using resources held on behalf of core customers," Staff said

Cases 20-E-0380 & 20-G-0381