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Retail Supplier Seeks Changes To POR Discount Mechanisms In Light Of 50% Increase In Discount Rates
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NRG Energy's retail suppliers have sought changes to the mechanisms related to the electricity standard complete billing percentages (SCBPs), or purchase of receivables (POR) discount rates, in Massachusetts
As first reported by EnergyChoiceMatters.com, under the currently applicable mechanisms, the National Grid POR discount for residential customers is proposed to increase to 2.99% from the current 1.99%, while Nstar's POR discount for residential customers is proposed to increase to 1.33% from the current 0.86%
See the complete POR discounts proposed by EDCs in our prior stories linked below:
National Grid
Nstar
Filing similar comments in both proceedings addressing each EDC's discount rates, NRG said (comments in National Grid proceeding quoted), "As discussed below, the SCPBs proposed by NGRID represent a dramatic decrease in payments made to competitive retail suppliers with respect to their residential and commercial customers. As such, the Company’s proposal will create significant rate volatility in the market which will adversely impact municipal aggregation and competitive supply customers. Consistent with the comments set out below, in the interests of affected customers, the NRG Retail Companies respectfully request that the Department consider and investigate alternative approaches to these types of annual changes in POR discount rates in this docket or a future POR docket."
The NRG Retail Companies urged the DPU to investigate -- in the instant dockets or a future POR docket -- alternative approaches to the annual changes in POR discount rates, "in order to mitigate volatility in the municipal aggregation and retail energy competition markets."
NRG said that such alternatives may include, but need not be limited to:
• Suppliers pay a consistent rate and NGRID and Eversource create a non-bypassable reconciliation charge to collect or refund variations over time.
• Establish a bandwidth for year-over-year changes to the POR discount, with costs being deferred for percent changes outside of the band.
NRG noted that the DPU has approved alternative POR discounts, which have deviated from the standard calculation, in the past, due to concerns about the impact of a COVID-19 disconnection moratorium on uncollectibles and to mitigate fluctuations associated with the reconciliation factor
24-POR-01 et al.
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April 12, 2024
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Copyright 2010-24 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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