Claim: Municipal Aggregation Programs "Offer Choices That Are Not Otherwise Available In The Market"

October 9, 2023

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Copyright 2010-23 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

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Municipal aggregation programs, "offer choices that are not otherwise available in the market," a group of municipalities said in comments to the Massachusetts DPU concerning proposed DPU guidelines to govern aggregation plan filings and a proposed template plan

See background on the DPU proposal here

A group including more than four dozen municipalities, including the City of Cambridge and the communities of the Cape Light Compact, stated, "in 2022 over 100 communities offered a voluntary product with additional Class I RECs."

The communities further stated, "Based on the products listed on EnergySwitchMA.gov, not a single competitive supplier is offering a product with additional Class I RECs. The green products offered by competitive suppliers all rely on national wind, or similar, RECs, with limited additionality benefits."

The communities sought less oversight from the DPU, including the ability to offer new products without DPU approval

"Rather than continuing to manage the nuances of every single aggregation program, the Department should use the Guidelines to set out general rules and allow municipalities to operate within them. New products, new REC percentages and types, and other innovations should all be allowed without the need for Department approval. This approach would be far less time consuming for the Department, give needed flexibility and appropriate respect to municipal officials, and benefit customers," the communities said

"Enhanced customer choice is one of the primary benefits of aggregation programs, and one of the primary goals of the competitive electric market. The Guidelines should facilitate the ability of municipalities to offer new options tailored to their residents and businesses," the communities said

"For example, municipalities should not be precluded or unduly frustrated from offering new products without first going through a lengthy aggregation plan amendment and approval process. Take, for example, the case of a municipality that wishes to offer its residents a new, optional, 100% REC product. Scores of other municipalities offer such a product. A municipality that wishes to start doing so should not be required to delay for a year or more, waiting for the Department to give it permission. And, importantly, customers should not be required to wait a year or more to purchase a product that they want and their community has decided to offer," the communities said

The communities, which have opt-out authority (even if new optional plans are opt-in) and the imprimatur of a government program, complained that, "Significantly, competitive suppliers are not required to obtain Department approval to offer new products. They are free to offer new products at will. Under the Guidelines, opt-in products offered by aggregation programs would be subject to all of the requirements governing products offered by competitive suppliers. Certainly, aggregations should also be given the same opportunities."

In making the point that muni aggregations are better able to inform customers of rate options (and thus less DPU oversight is needed), the communities said, "...municipalities have the benefit of leveraging channels to their residents and businesses not available to direct-to-consumer competitive suppliers, such as municipal press releases, websites and social media; local government meetings; local cable access TV; as well as the program website."

"As long as these communications vehicles are in place, consumers can make informed decisions about whether to participate in the aggregation program. It is not necessary or appropriate, in the pursuit of consumer protection, for the Department to restrict the products that the program makes available by requiring those products to be rigidly fixed in the aggregation plan. Consumers will be able to make their own, informed decisions," the communities said

D.P.U. 23-67

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