By William Opalka

The New York Public Service Commission on Thursday declared a moratorium on energy marketers signing up low-income customers, citing the inability of stakeholders to agree on consumer protection reforms (12-M-0476, et al.).

The commission voted 3-1 to impose the moratorium, which takes effect in 60 days.

The PSC ordered a stakeholder collaborative after its February 2015 order requiring energy service companies to guarantee that low-income consumers enrolled in utility assistance programs will pay no more under an ESCO contract than they would have as a full-service utility customer. (Alternatively, the ESCO must provide the customer with value-added products or services that do “not dilute the effectiveness of the financial assistance programs.”)

The collaborative, which included ESCOs, low-income advocates, utilities and regulators, was unable to reach a consensus that would have satisfied the aims of the order.

Commissioner Diane Burman opposed the moratorium. “The statements in the conclusion [of the order] seem to [be] more in the nature of an advocacy, rather than in a reasonable balancing of the issues that we’re supposed to deal with as regulators,” she said.

Burman said the collaborative’s report showed that some ESCOs were willing to offer savings but that the “pathway” for further discussion was cut off by the moratorium.

PSC Chair Audrey Zibelman said that the first imperative was to “do no harm” while the commission dealt with further enhancing consumer protections.

“The record is clear that low-income customers have not benefited from electric and gas supply services from ESCOs when that’s all that’s being purchased. The commission is taking steps to ensure energy affordability for low-income customers,” Zibelman said in a statement. “Unless and until these guarantees can be made, it is critical that we ensure that low-income customers are not paying any more than necessary for gas and electricity. We challenged the competitive retailers to look for ways to guarantee savings at or below the cost of utility-supplied power and gas.”

The action follows a PSC order in February 2016 that mandated savings for most retail customers. That order has been challenged by retail energy marketers. (See Court Delays New York ‘Guaranteed Savings’ Rules.)

The PSC estimates that there are more than 400,000 low-income customers served by ESCOs. Low-income customers represent about 25% of all electric customers in the state.

Customers currently served by an ESCO will revert to the host utility’s default service when their contract expires. The moratorium will last until the commission determines it can be lifted, the order states.

The Retail Energy Supply Association said it was reviewing the order with its members and legal counsel.

“If maintained, the moratorium would prevent low-income customers from accessing fixed-price energy offers that provide price certainty when compared to New York utilities’ monthly variable rates,” spokesman Bryan Lee said in a statement. “This is a benefit that is of particular value to consumers on fixed or limited incomes. By way of this order the commission has taken away the low-income consumer’s ability to enter into fixed rates just before the potentially volatile winter months when we know from experience that utility default rates can fluctuate widely in response to extreme weather.”