Regulator Maintains Current Purchase Of Receivables (POR) Discount Rates Due To COVID Shut-off Moratorium

The Massachusetts DPU, at both Eversource (Nstar, East & West) and National Grid has ordered that the currently effective purchase of receivables discount rates (standard complete billing percentages) shall remain in effect, subject to investigation and reconciliation, unless the Department orders otherwise.

Additionally, for both utilities, the currently effective payment periods to retail suppliers had remained in effect (both EDCs had proposed longer payment periods)

In doing so, the DPU noted the impact that the COVID-19 customer disconnection moratorium has had on uncollectibles. With the shut-off moratorium, utilities have not terminated service to electric residential customers and, therefore, have not charged-off customer accounts receivable to the same extent as previous years. This would result in a lower uncollectible component in the POR discount under the normal calculation (and, due to other components, a negative POR discount for some classes).

The DPU said, "The Department recognizes that the COVID-19 pandemic has caused not only a public health emergency, but significant economic disruption. Further, the COVID-19 pandemic has affected the financial position of jurisdictional electric, gas, and water distribution companies, and utilities throughout the country. Utilities face shifts in demand and usage, increased operational burdens, collections shortfalls, and voluntary and mandatory moratoriums on disconnections. As the financial position of the utilities would not be representative of a normal test year, the need for examining ratemaking measures to address the effects of this pandemic is apparent. The COVID-19 pandemic and the Shut-Off Moratorium have created unique circumstances affecting the POR Program that require further investigation. Therefore, the Department finds that it is appropriate to keep in place the Company’s currently effective SCBPs and payment periods, subject to investigation and reconciliation."

As a result, the DPU maintained the following existing POR discounts

Nstar - East & West 
POR Discount
Existing, Continuing Effective May 1, 2021
              Residential  Commercial  Industrial
Total            1.69%       0.24%       0.11%




National Grid
POR Discount
Existing, Continuing Effective May 1, 2021
Total            3.11%       1.35%       0.12%

DPU 21-POR-02 et al.