Retail Suppliers Say Utility's UCB Per Bill Fees Not Justified, Suggest Allocating UCB Fees To Offset SCB Costs

IGS, WGL Energy Services, Inc., NRG Energy, Inc., and Vistra Corp. (the supplier coalition) presented joint testimony in the current electric and gas rate cases of Baltimore Gas & Electric alleging that BGE has not proven that the per-bill fees that BGE imposes upon retail electricity and natural gas suppliers for utility consolidated billing are just and reasonable.

For UCB services, BGE charges a 50 cents per-bill fee to electricity suppliers and 30 cents per bill for natural gas UCBs.

The supplier coalition said, "Suppliers that provide dual fuel products (electricity and gas) pay both fees even though BGE is sending only one bill with all charges."

The supplier coalition said, "These fees were intended to recover BGE’s billing costs related to providing UCB services to suppliers. In other words, these fees are a rate paid by suppliers for a service, and the level of the rate should cover BGE’s reasonable and prudent costs of providing that service. This standard of recovery is no different from any other cost that BGE seeks to recover from ratepayers."

The supplier coalition said, "BGE, however, has not performed an analysis of these costs since at least 2020 and quite possibly since the fees were initially implemented."

The supplier coalition said, "BGE has not demonstrated that the UCB costs and related fees are just and reasonable, or that the costs were prudently incurred. It is quite likely that BGE’s costs to provide UCB services are lower today than they were in the past. For example, BGE would have recovered its initial investment to provide the service, and more customers are receiving their monthly invoices electronically. BGE also may not be incurring any incremental costs with respect to the UCB services that would warrant cost recovery from suppliers. The point is that the Commission has no way of knowing what the costs are because BGE did not present any cost analysis to justify continuation of the fees."

The supplier coalition recommended that the Commission reject BGE’s per-bill fees for UCB services, "because BGE has not demonstrated that they are just, reasonable, or prudently incurred, and BGE may be double-recovering certain costs."

The supplier coalition, however, suggested that the PSC may wish to continue the UCB fees and use such to offset supplier consolidated billing costs

"[T]he Commission may want to consider leaving these fees in place and allocating the revenues to offset a portion of BGE’s approved SCB-related costs. Based on the analyses presented in Case No. 9461, the current per-bill UCB revenues would cover more than fifty percent of BGE-Electric’s SCB implementation costs on an annual amortized basis, plus carrying costs, and would come close to recovering 50% for BGE-Gas, based on the most recently reported shopping levels. Leaving these fees in place as-is would not impact current UCB suppliers’ offers and would be competitively neutral among suppliers. The Commission could direct BGE to track these revenues going forward and reduce the UCB per-bill fee as the SCB costs are paid," the supplier coalition said

Case No. 9692