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PSC Staff Propose Price Cap For Standard Green Power Product
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Residential "green power" offers from retail electric suppliers in Maryland would be limited to a rate based on the average SOS rate, plus the average Tier 2 REC price, under a proposal from Staff of the Maryland PSC to implement SB1's green power pricing provisions
As previously reported, SB 1 requires that the PSC adopt a rate cap for residential "green power" plans. Retail suppliers, who, starting January 1, 2025, are already subject to an SOS-based price cap for non-green plans, would be permitted to petition the PSC for a supplier-specific green power price in excess of the standard green power price decreed by the PSC
Per the definition of "green power" under SB1, the green power price cap would apply to any residential plan that offers, "energy sources or renewable energy credits that are marketed as clean, green, eco–friendly, environmentally friendly or responsible, carbon–free, renewable, 100% renewable, 100% wind, 100% hydro, 100% solar, 100% emission–free, or similar claims."
Staff proposed that the standard green power price cap, to be specific to each service area, be set by the PSC as equal to the most recent 12-month average SOS rate for the applicable service area plus the average Tier 2 REC price in the prior year’s RPS report
Staff said that, in calculating the green power rate cap, the use of the Tier 2 REC price, which is generally the lower of the RPS-eligible REC prices for Maryland, would constrain a supplier's opportunity to make an "unfair profit" by purchasing the cheapest RECs, which would otherwise be possible if the rate cap were instead based on a higher REC price
Staff said that a retail supplier seeking to offer a residential green power plan backed by Tier 1 RECs, which may not be economic under Staff's proposed standard green power price cap, could petition the PSC to adopt a higher price cap for that specific Tier 1-based product
Staff's proposal was made in requesting that the PSC commence a proceeding to adopt the price guidelines for "green power" plans from retail suppliers.
PC66
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October 9, 2024
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Copyright 2024 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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