Investor-owned utilities and energy service companies (ESCOs) in New York picked apart state recommendations on community choice aggregation (CCA) made in an April white paper, supporting some and rejecting others (14-M-0224).

The Department of Public Service staff paper made recommendations to resolve program challenges, remove barriers to data access and better incorporate distributed energy resources into CCA programs.

The Municipal Electric and Gas Alliance (MEGA), an ESCO serving upstate New York, said it supports program standardization and uniformity in elements of the CCA program rates but disapproves of the recommendation to adopt a 5% cap on commodity product offerings.

“The fundamental calculation of the ‘price to compare’ is flawed, [and] to use a baseless price construct and impose a 5% cap is nonsensical. More importantly, it is disconcerting that staff is considering imposing an artificial limit to a free and competitive supply market,” MEGA said.

DPS staff recommendations include standardizing CCA program filing requirements; streamlining the filing process; modifying existing requirements; and adopting additional requirements.

NRG Energy said it generally agrees with the department’s proposal to develop a uniform filing structure, but not with the recommendation that all program participants be enrolled in the same rate, regardless of when they join the CCA, unless they voluntarily choose a different option.

“NRG prefers the ability to enroll new participants on a different rate due to seasonality and price risk … [and] does not necessarily agree with the proposal surrounding the price to compare,” the company said.

“First, the price to compare in New York is not a fair apple-to-apples comparison. Utilities adjust and true up their rates after the fact, making it impossible for ESCOs to compete with the rate,” NRG said. “As a result, including the price to compare on a customer’s bill will be misleading and not an accurate summation of the value they are receiving from participating in the CCA program.”

Make-work Complaints

The state’s IOUs said they support standardizing guidelines, processes and procedures for CCA programs; “however, some staff recommendations are infeasible and cannot be cost-effectively implemented at this time. Others require additional collaboration to develop necessary program rules and details, especially as it relates to integrating community distributed generation (CDG) on an opt-out basis.”

The IOUs recommended, to ensure consistency, using the quarterly 12-month trailing average price to define the price to compare for the CCA market. But they requested further discussion among stakeholders regarding the public-facing display of such information “to determine whether using the current 12-month trailing prices is sufficient, how to best present residential and nonresidential service classification information most clearly, and what effect displaying the price has on the different programs.”

The utilities also opposed the recommendation that during a CCA program opt-out period, the utility be required to maintain a record of every customer that contacts them to opt out or to have an ESCO enrollment block placed on their account for the purpose of CCA program opt-out.

“There are little to no benefits in requiring” utilities to track customers in such a way, and this additional tracking and reporting is “needless” because enrollment in the CCA will not happen if the customer has requested a block on their account during the opt-out period, the IOUs said.

Additionally, the utilities urged the Public Service Commission to address conceptual design elements before either extending the ability to combine opt-out CDG with CCA or allowing opt-out CDG-only programs.

The IOUs said design elements that need to be considered include compensation that reflects reduced developer costs of the opt-out CDG model; potential inequities among municipalities; utility data considerations; customer protections; and implementation and administration changes for opt-out CDG.

MEGA said that “pairing CCA programs with opt-out CDG savings provides a powerful tool given the challenges with procuring affordable 100% green electric supply for CCA communities. By pairing the programs, communities that are hesitant to potentially increase resident electric bills with 100% green supply can access a guaranteed savings program through opt-out CDG.”

If New York state is invested in incentivizing and growing CCA programs, the two programs should remain paired, MEGA said, noting it “does not support standalone opt-out CDG but recommends that these programs operate in tandem to enable greater renewables access and affordability.”

The IOUs cautioned that creating a set of blanket requirements for as yet undefined new offerings may not be achievable considering the potential number of permutations that could arise, instead recommending the commission establish “an ongoing framework under which it will consider authorization of new CCA programmatic offerings.”

Consumer Protections

NRG also urged the commission to make further improvements to the filing process. The system does not currently work with many of the newer browsers that corporations are using, and older browsers do not always work with corporate firewalls and other protections.

The company made specific requests regarding both the aggregated dataset and the customer-specific contact information set.

“Sometimes the rules may seem appropriate on paper; however, when actually implementing the program, they are not practical in nature,” NRG said.

The aggregated dataset should provide the customer’s bill cycle and period codes, rate class and NYISO ICAP tags and zones, as these fields are necessary for ESCOs to accurately price customers and prepare a bid. The bill cycle and period codes are the most important pieces of information for timing purposes, NRG said.

In addition, NRG said it does not believe that municipalities are authorized to impose gross receipts tax (GRT) on customers taking service under CCA programs.

“Any suggestion that NRG and other ESCOs should increase their charges to CCA customers and then make payments to such municipalities ‘in lieu of’ GRT would violate Rule 28 of the commission’s CCA rules, which expressly provides that ‘municipalities may not collect funds from customer payments to cover lost sales tax revenues,’” NRG said.

The Coalition for Community Solar Access (CCSA) said it supports the commission’s requirements to always provide savings, to not include a credit check, and to ensure necessary outreach and education.

Regarding an April petition from software company Ampion for PSC approval of a program similar to a traditional CCA that supplies only a CDG product — one not integrated with other CCA products — the solar coalition encouraged the commission “to review the petition from the same lens it has reviewed this matter: ensuring the customer choice, customer engagement, consumer protection and customer benefits are at the center of all consideration.”