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Confusion Remains On What Can Be Offered As Green Power In Maryland
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In separate petitions, both retail energy suppliers and the Maryland Office of People's Counsel have sought clarification of the Maryland PSC's recent order establishing a price cap, and related requirements, for green power offers in Maryland (Case 9757)
As previously reported, SB 1 only allows retail suppliers to sell "green power" to residential customers at either: 1) a price set by the PSC generically, or 2) a price established through a company-specific petition from a retail supplier
Under SB1, "green power" is defined as, "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." [Public Utilities Article § 7-707(a)]
SB 1 mandates that, for residential customers, a retail supplier may not market a product as "green power" unless, among other things, the product includes green energy or RECs, both of which must meet the standards to qualify for use in Maryland's RPS, in an amount that equals or exceeds the higher of the following: (1) 51% of the product's supply, or (2) is at least 1% higher than the RPS which is applicable in such year
The PSC recently established the generic price cap for green power offers
In doing so, the PSC also addressed REC eligibility for green power products
As previously reported, the PSC, "directs retail electric suppliers to retire all RECs composing an approved green product, 51% and above, into a PJM tracking system accessible by the Commission."
Such language could be read as prohibiting any use of RECs that cannot be retired in PJM GATS, even for the part of the product above the 51%
However, OPC and retail suppliers sought clarification on whether RECs used in green power products, above the 51% minimum, must be retired in PJM GATS, arguing that other language from the PSC's order suggests that non-Maryland-RPS RECs may, in fact, be used (as noted by ECM previously, there may be a universe of RECs that are eligible to be retired in PJM GATS but not eligible for Maryland RPS; however, both OPC and retail suppliers in their petitions more broadly addressed national RECs that cannot be retired in GATS)
Specifically, in the same order, the PSC ordered retail suppliers to use the following disclosure as part of green power products: "In your
contract, [X]% of the RECs qualify for Maryland’s renewable
portfolio standard. The remaining [Y]% of RECs are [the specific
product being marketed]."
OPC observed that the second sentence in this language is not needed if the PSC's intent is that only Maryland RPS RECs can be used in green products
OPC's interpretation of SB1 has been that national RECs may be used for the part of the green power plan above 51%, but sought clarification from the PSC
The Retail Energy Supply Association and CleanChoice Energy Inc. also pointed out the potential conflict in the PSC's language, and sought clarification that national RECs are permitted for the part of the product above 51%, provided that such national RECs are retired in an appropriate system similar to GATS and are able to be verified by PSC Staff
The retail suppliers' request was included in a request for reconsideration, as suppliers again raised concerns with the PSC's process to set the price limit for the generic green product, with the adopted cap based on the average of last year's Tier 2 REC price (see a full discussion of how the green price cap specifically works here)
Retail suppliers said that the PSC in setting the initial green price cap did not receive evidence from subject matter experts and witnesses subject to cross examination, and sought confirmation from the PSC that future annual proceedings to set the green price cap will include opportunities to present direct and rebuttal evidence, with cross-examination of witnesses
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January 23, 2025
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Copyright 2025 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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