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February 6, 2015
NEM 18th Annual National Energy Restructuring Conference

NEM will convene its 18th Annual National Energy Restructuring Conference on April 29th-May 1st, 2015. This year the conference will focus on “Redesigning Wholesale and Retail Energy Markets - Enhanced Consumer Services and Advanced Technologies Lead the Way." The conference will begin with a Welcome Reception on the evening of April 29th at the Georgetown Club. The next two days of substantive discussion will take place at the Embassy Suites, Washington, DC Convention Center. You may register for the conference at this hotlink. An agenda is forthcoming.

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SB573 Would Ban Residential Electric Variable Rates

SB573 was introduced in the legislature, "to ban variable rates charged to residential electric customers for electric generation service." The bill was referred to the Joint Committee on Energy and Technology and was part of a subject matter public hearing this week. The full text of SB573 is available on the NEM Website.

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Updated Website and Electric Choice Portal

Last week the Commission launched an updated version of its website, including an electric choice portal available at:

Corresponding with these changes to the website, Commission Staff sent a reminder last week about electric suppliers' obligation under MD PUA 7510.1(c)(2) to post offers to the portal. The statute provides that, "At least once each month, each electricity supplier with an open offer to supply electricity shall submit detailed information about the offer to the Commission through a secure portal maintained by the Commission on the Commission's web site for this purpose."

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Electric Competition Report

The Commission issued its annual report to the legislature on the Status of Electric Competition in Michigan for the year 2014. The Commission reported that as of December 2014, there were approximately 6,460 customers (comprised nearly entirely of C&I customers) participating in the electric choice programs, representing approximately 2,354 MWs of electric demand, and that approximately 11,000 customers remain in the queue. The Commission noted that in 2014, Michigan's average residential retail rates ranked eighth highest in restructured jurisdictions. C&I rates for that period ranked in the middle.

The Commission did not recommend specific legislation. However, it noted its concern related to the pending retirement of generation. "As it relates to electric choice, the Commission found in its most recent assessment, 'there appears to be a gap in the planning and procurement of adequate resources for the long term for customers served under the customer choice program.' The Commission is not recommending specific legislation but reiterates the urgency and importance of this issue in Michigan to the overall reliability and affordability of electricity supplies." The full text of the Report is available on the NEM Website.

New York
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Order on Rehearing on ESCO Service to Low Income Consumers and Independent TPV Requirement

The Commission issued an Order on Rehearing deciding some of the issues that had been stayed in the Retail Market Review proceeding.

The Commission clarified its prior holding regarding ESCO service to low income customers as follows:

"ESCOs have no obligation to serve any customer, however, when an ESCO serves an Assistance Program Participant, the ESCO must satisfy at least one of two conditions. The ESCO must guarantee that the customer will pay no more, on an annual basis, than the customer would have paid as a full service customer of the utility, or the ESCO must provide Assistance Program Participants with energy-related value-added products or services."

The Commission included fixed rate products within the definition of value-added products for these purposes. Staff is directed to convene a collaborative for the purpose of defining, "the energy-related value-added products and services that must be provided to Assistance Program Participants to qualify for exemption from the price guarantee." The collaborative will also examine available technologies and mechanisms for implementing point-of-sale confirmation of a customer’s Assistance Program Participant status. Stakeholders must also develop corresponding EDI transactions.

The Commission affirmed its previous decision to requires independent TPVs, subject to the following clarifications:
1-The independent TPV requirement applies to all telemarketing calls regardless of whether the calls are customer-initiated or ESCO-initiated;
2- A warm transfer by a telemarketer to an independent TPV, without the marketing agent on the line, is permissible. It is not permissible in the door-to-door context;
3- IVR can be used for verification of door-to-door and telephonic marketing;
4- When a door-to-door agent enrolls a customer with a mobile electronic device, an independent TPV is required;
5- In-house verification is not permissible with the exception of IVR;
6- Independent TPV requirements apply to all enrollments through door-to-door or telephonic marketing, regardless of the marketer's characterization as a network marketer. If the marketer has not engaged in either door-to-door or telephonic marketing, then they are exempt from the requirement.
7- Independent TPV is not required when the ESCO is only seeking customer authorization for access to data;
8- Independent TPV is not required for enrollments at public venues.

The full text of the Order on Rehearing is available on the NEM Website.

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NEM Comments on Proposed Methodology for Assessing Supplier Oversight Fees

NEM filed comments on the Commission's proposed methodology for assessing EGS/NGS oversight fees. NEM expressed a number of concerns about the proposed methodology for assessing the fees including: the general lack of information available to evaluate the proposal; the overall propriety of assessment; the expedited timing under which it has been proposed and would potentially be assessed; the proposed volumetrically-based methodology under which the assessment would be determined; the potential magnitude of the assessment; and its anticompetitive impact on EGSs/NGSs and the punitive impact on consumers they serve. NEM recommended that the Commission form a stakeholder collaborative for the purpose of examining the issue of EGS/NGS assessments and developing a fully-vetted framework under which such fees might be assessed without negatively impacting the competitive marketplace and shopping consumers.

NEM noted that there is no statutory deadline under which Commission action is required, and the assessment of fees is discretionary with, not mandatory, on the part of the Commission. The issue of cost allocation related to Commission oversight of EGSs/NGSs is complicated, requiring a detailed disclosure and understanding of how these costs are currently assessed and collected by utilities to avoid a double collection of these same costs from shopping consumers. An extensive and precise accounting of regulatory oversight costs will also be necessary to properly determine cost causation and allocation. More information about all of these considerations is required in order to offer the most meaningful recommendations. Therefore, utilizing a stakeholder collaborative to thoughtfully examine the consequences of different potential assessment methodologies is appropriate. The full text of NEM's Comments is available on the NEM Website.

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