8/1/2017 6:45:02 PM -
For a number of months, there have been significant discussions on the ruling initiated by the New York Department of Public Service Commission (Commission) on ensuring Assistance Program Participants (APP) have rates that are fair and just. For those of you who are new to the New York APP (Low-Income) Prohibition…
A Little History
The Commission created an Order on July 15, 2016 (known as the July Order) and re-addressed the Order on September 19, 2016 (September Order) to remove ESCO involvement with any Low-Income customer. In a nutshell, the Commission argued that ESCO involvement with Low-Income (APP) customers was causing, in many cases, for those customers to be charged more than what the Utility would have charged. The ESCOs did not agree with this finding and, in a few cases, began litigation against the Commission for the potential loss of Business.
On December 15, 2016 (December Order), the Commission introduced an updated Order indicating the ESCO could serve the APP market … “if they are willing to guarantee that they will save dollars for these customers and develop a process to ensure that the putative savings do in fact occur”.
Impact on ESCOs not wishing to participate in this APP process
This is likely the scenario for the majority of ESCOs. As of July 26, 2017, Utilities must make available a list of APP Customers to which an ESCO can have access. (Note: this is not an EDI process but a secured means for the ESCO to access the Utilities’ list of APP customers. The format/access can differ for each utility.)
The ESCO will create an 814D to immediately DROP those APP Customers on the Utilities list. If there is an existing contract between the ESCO and customer, the DROP would occur at the end of the Contract.
The Utility will create a BLOCK on the Customer’s account blocking further access to enrolling the customer. When the APP customer’s status changes, such that they are out of the Low-Income status, the block will be removed allowing the Customer and ESCO to partner again.
Impact on ESCOs wishing to participate in this APP process
If the ESCO wishes to participate with the APP customers, the ESCO must submit a waiver to the Commission indicating that is their desire. The Commission will review all waivers and provide their acceptance or rejection of the ESCOs waiver. (NOTE: As of 7/27/2017, no waivers have been accepted…and, of the 200 plus ESCOs in New York, only 11 have submitted a waiver indicating their interest in participating).
If the Waiver is accepted by the Commission, the ESCO must have in place a process to determine if the price they have charged the APP customer is equal to or less than the price that would have been charged by the utility. If the ESCO price is greater than the Utility price a CREDIT must be directed to the customer.
Impact on EDI Processing
If the Supplier does not submit a Waiver… The primary impact on the ESCO is to submit Drops (814D) for those customers identified by the Utility as APP (Low-Income) customers
If the ESCO submits and receives an approved waiver… The impact on the ESCO is to compare their costs to the costs the Utility would have charged. To address this, the ESCO would go through the following:
The above information reflects the high-level processes related to the New York Prohibition. There are more specifics that are being addressed. Should you have any questions on the above, or would like additional information, please let us know at… Info@mrktwise.com