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PSC Commissioners Concerned About Elimination Of Residential Shopping Until June 2026 If Proposed Interim Dual Billing Mandate Adopted
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Several Commissioners of the Maryland PSC expressed concern during a hearing yesterday about the viability of residential energy choice if the PSC adopts a dual billing mandate for new residential electric and gas customers during an interim period that would be in place until utilities develop and implement a post-POR form of utility consolidated billing
All references to UCB, POR and customers in this story relate to residential service, even if not specifically identified as such.
SB1 prohibits residential POR for contracts executed or renewed after December 31, 2024. As previously reported, PSC Staff has proposed that contracts prior to January 1, 2025 should be eligible for grandfathered UCB with POR until a post-POR form of UCB is in place. However, due to technical limitations at the utilities, Staff proposes to mandate dual billing for contracts executed or renewed after December 31, 2024, until a post-POR form of UCB is in place. Staff has proposed an anticipated date of June 1, 2026 for the enactment of post-POR UCB, based on utility estimates for implementation times See our prior story for full background on the issues
Commissioner Bonnie Suchman feels "stuck" and said that the Commission hasn't been provided by stakeholders a path forward that doesn't present a "big problem".
Suchman is "a little concerned" about creating a scenario in which there would be no new residential enrollments during the interim period that is anticipated to last until June 1, 2026. Some 11 retail suppliers, with significant market share, have said that they are not able to implement dual billing for up to approximately 18 months, depending on supplier
Suchman said that all of the solutions presented to date are not addressing the POR issue, while creating a "real challenge" for retail suppliers to continue to stay in business
Suchman said that, if the PSC were to adopt Staff's proposal of approximately 17 months of mandatory dual billing, she can't see a scenario in which the competitive retail supply industry isn't harmed, "in a big way".
"We don't want a situation where the retail electric supply industry goes belly up," Suchman said
"I'm not seeing a good result for anybody in this," Suchman said
Suchman wanted to find a solution that protected everyone -- customers, suppliers, and utilities -- and asked whether the utilities' technical software experts could develop another solution -- not a full implementation of SB1, but something akin to a "patch"
Suchman mused about applying a mechanism where utilities could, for new shopping customers, continue UCB while holding back payment to retail suppliers until the customer paid the utility (thus utilities would not be purchasing suppliers' receivables, in compliance with SB 1)
Utilities, however, said that even if such a process were put in place, the utility would still need to develop how to address partial payments from customers, which implicates development and testing time
The PSC said that it would issue an additional series of technical and software questions to the utilities to attempt to find if any alternative to the options presented in a PSC Staff report exist. As of publication time, the questions have not yet been issued
Commissioner Michael Richard echoed certain of Suchman's points, including pressing utilities on whether a "tweak" could be adopted to allow continued UCB without POR for new shoppers, and asked whether mandatory dual billing is "fair" to retail suppliers. However, Richard also pressed retail suppliers on their ability to offer dual billing, noting that other energy companies not in the retail supply market, such as solar installers and community solar providers, have dual billed him for various services
During the discussion, it was noted that Potomac Edison has stated that it is capable of implementing a form UCB without POR on a faster timeframe than the 18 months required for adoption of a pro-rata mechanism, using the pre-POR payment posting mechanism (which generally paid EDC charges first where charges are of the same vintage). This mechanism could be put in place in 6 months
Several Commissioners were not receptive to a proposal from retail suppliers that UCB with POR should continue to be offered to all customers, including new customers after Jan. 1, 2025, until a post-POR form of UCB is ready
Suchman said that the PSC can't adopt POR for all residential customers
Retail suppliers addressed consumer advocates' concerns about customers, in the advocates' view, having a greater exposure to disconnection for non-payment under a continued POR for all customers until post-POR UCB is adopted.
Retail suppliers noted, at first, that customers in certain electric utility payment assistance programs can not be served by a retail supplier under a new contract, unless the PSC approves a supplier-specific offer for assistance customers (and no such supplier offer for payment assistance customers has been adopted by the PSC).
Additionally, suppliers observed that, for new contracts, supplier rates will be capped at a historic average of the SOS rate for standard power customers, or at a PSC-established rate for green power customers
Concerning the Staff proposal to continue grandfathered POR for contracts existing or renewed prior to Jan. 1, 2025, Suchman raised concerns about the utilities not knowing whether the customers billed under grandfathered POR are actually eligible for POR and actually have grandfathered status
Furthermore, Suchman raised concerns about how a "contract" and its end date are defined, and what constitutes a "renewal" of a contract, as a renewal would make a former grandfathered customer ineligible for POR, versus just a price change under an existing contract
A representative from a utility suggested that the Commission could clarify what constitutes contract expiration and renewal via Commission order
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Copyright 2024 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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