PUC Directs Utilities To Propose Minimum Stay For Customers On Default Service In Response To Drop Of 500,000 Customers From Muni Aggregation To Utility Supply

PUCO Issues Show Cause Order To NOPEC Directing Aggregator To Show Why Certificate Shouldn't Be Suspended

PUCO Grants NOPEC Waiver To Drop Customers To SSO

NOPEC Alleges Dynegy Sister Company Returned 35,000 Muni Aggregation Customers To SSO This Year

September 7, 2022

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Copyright 2010-21 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

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The Public Utilities Commission of Ohio has directed the state's electric utilities to propose minimum stay provisions for the Standard Service Offer (SSO), in an order addressing the return of 550,000 electric customers from the Northeast Ohio Public Energy Council (NOPEC) opt-out municipal aggregation to the SSO

While PUCO's dicta specifically cites minimum stay provisions as a means to address returns of customers from governmental aggregators, the specifics, and applicability, of such minimum stay provisions will be addressed upon the filing of proposed tariffs by the EDUs

PUCO said, "the Commission is committed to protecting the wholesale auctions which provide the generation for SSO service in all Ohio EDUs service territories. NOPEC’s conduct may be unprecedented, but it is capable of repetition. Therefore, the Commission directs that each EDU in this state work with Staff to develop proposed amendments to their respective supplier tariffs providing for a 'minimum stay' to prevent governmental aggregators from prematurely returning customers to default service and then, within an unreasonably short time, reenrolling such customers in a new aggregation program. The Commission notes that all interested parties will have the ability to address such proposed tariffs as provided by R.C. 4909.18."

"The Commission is concerned that both NOPEC’s actions, prematurely returning customers to SSO service prior to the scheduled end of the aggregation program, and proposed actions, reenrolling these same customers at some undefined point in the future when NOPEC deems that economic conditions are favorable, will adversely affect the wholesale generation providers who supply generation for the SSO service, resulting in higher prices for SSO customers," PUCO said

PUCO's order addressed a waiver request from NOPEC to allow a faster transition of customers to SSO. While the transfer will still occur on the next meter read date, the transfer would have been delayed due to certain EDUs' limits on how fast they are able to generate and mail customer drop notices, which are required by rule, and which would have delayed the drop beyond the sought next meter read date

PUCO approved this waiver, "because it provides an opportunity for customers currently in NOPEC’s aggregation program to take advantage of energy savings provided by the SSO service."

The waiver is contingent upon the notice being provided to customers by NOPEC, rather than the EDCs

"The Commission finds that the waiver proposed by NOPEC should be granted to provide NOPEC customers with an opportunity save money on their electric bills by receiving generation service from the SSO at a lower price than the variable rate offered by NOPEC and its supplier, NextEra Energy Services Ohio. Accordingly, customers returned to SSO service between August 1, 2022, and September 30, 2022, will not be subject to the provisions of Ohio Adm.Code 4901:1-10-29(H)(2), which requires the EDU to provide notice to customers returning to SSO service," PUCO said

"However, the Commission distinguishes between NOPEC’s customers, who in good faith enrolled in the aggregation based upon representations of energy savings, and NOPEC and [NOPEC's supplier] NextEra [Energy Services], who bear responsibility for the circumstances surrounding the request for the waiver," PUCO said

PUCO directed NOPEC to show cause by September 28, 2022, demonstrating why its CRES [competitive retail electric service] certificate should not be suspended pursuant to Ohio Adm.Code 4901:1-24-13.

"The Commission finds that both the premature return of customers to SSO service and the potential failure to comply with the operations and governance plans cast doubt upon whether NOPEC continues to demonstrate the managerial, technical and financial capability to be certified as a CRES governmental aggregator in this state," PUCO said

PUCO further raised concern with NOPEC's pricing, and whether its governance plans allow for the drop of customers to SSO under the present circumstances

"The record is not clear whether the decision of NOPEC and NextEra to not match the SSO price, and thus follow through on their prior representations, is due to legal constraints or economic choices. Nonetheless, NOPEC seeks the premature return of customers to SSO service prior to the scheduled end of the aggregation program. Moreover, the record in the Certification Case provides evidence of a potential violation of NOPEC’s communities’ operations and governance plans, which do not appear to allow for the return to customers under these circumstances and require a 90-day notice to customers prior to being returned to SSO service. See Notice of Northeast Ohio Public Energy Council adding an additional ordinance from the City of Sebring, Certification Case (Aug. 17, 2021). The Commission finds that both the premature return of customers to SSO service and the potential failure to comply with the operations and governance plans cast doubt upon whether NOPEC continues to demonstrate the managerial, technical and financial capability to be certified as a CRES governmental aggregator in this state," PUCO said

PUCO's order did not address allegations raised by Dynegy Marketing and Trade, LLC concerning NOPEC, noting that responses to certain of Dynegy's various motions were due today (see prior story here on Dynegy's allegations)

In a filing, NOPEC alleged that, "Dynegy has absolutely no qualms about its sister company returning an estimated 35,000 customers to the SSO so far this year from about 13 different governmental aggregations."

NOPEC in the filing alleged, "Dynegy accepted the business risk of serving more SSO customers than expected when it bid into the SSO auction and signed FirstEnergy’s SSO Supply Agreement. Dynegy is now attempting to shirk its contractual responsibilities as an SSO supplier by attempting to prevent NOPEC from returning customers to the SSO. This anti-consumer gamesmanship by Dynegy, if successful, would undeniably result in as many as 550,000 Ohio electric consumers paying higher prices for electric generation service solely to pad Dynegy’s profit margin."

As of publication time, NOPEC's filings available on PUCO's DIS site were limited to procedural responses concerning intervention and discovery. NOPEC alleged, "NOPEC has not been properly served a copy of the Complaint filed last week [by Dynegy] in Case No. 22-817-EL-CSS, and has not been afforded its right to answer or file dispositive pleadings."

Case 00-2317-EL-GAG; 22-806-EL-WVR

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