New York State Department of Public Service Retail Energy Competition Programs and Strategies

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New York StateDepartment of Public
ServiceRetail Energy CompetitionPrograms and
Strategies

• National Energy Marketers Association
• Fall Leadership Roundtable and Regulatory
  Workshop
• October 24-25, 2006

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Programs and Strategies

• Purchase of Receivables
• ESCO Referral Programs
• Market Match
• Market Expo
• Energy Fairs
• Utility Competition Education and Outreach
  Programs
• NYDPS Competition Education Program
• Coordinating NYDPS retail competition issues

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Purchase of Receivables

• The utility buys the ESCOs receivables.
• Without recourse, at a discount.
• The discount represents the utilitys costs for
  administration and credit and collection
  expenses.
• The discount has ranged from about 1 to 3.
• The utility uses consolidated billing.
• POR eliminates complications associated with
  pro-ration of partial payments and service
  shutoffs, and benefits both the utility and
  ESCOs.
• The ESCO avoids certain administrative and
  back-office costs.
• The ESCO receives monthly payments from the
  utility.
• The details are defined in the Billing Services
  Agreements signed by the utility and ESCOs.

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ESCO Referral Programs

• Seen as a transitional program to introduce
  customers to competitive choices.
• ESCO guarantees (7) savings on utilitys
  variable supply price for two billing periods.
• The programs can include gas/electric service and
  residential and small commercial customers.
• Utility customers are offered participation by
  utility call center reps, bill inserts, etc.
• The customer can choose a participating ESCO or
  be assigned to one on a rotating basis.
• The utility initiates EDI enrollments.
• Programs typically require POR and consolidated
  billing.
• The first program was developed by OR, now named
  PowerSwitch.
• Residential switching at OR has exceeded 30 and
  is largely attributable to PowerSwitch.

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ESCO Referral Programs(continued)

• Orange and Rockland - PowerSwitch
• Con Edison - PowerMove
• National Grid - New Choices
• Central Hudson - EnergySwitch
• National Fuel Gas - Marketer Referral Program
• NYSEG - (in development)
• RGE - (in development)
• KeySpan - (pending rate and merger proceeding)

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Market Match

• CI customers can get energy quotes from ESCOs
  via a utility website.
• With customer authorization, the utility posts
  anonymous customer data (usage, etc.) accessible
  by ESCOs via a secure connection.
• The ESCOs post their proposals to the utilitys
  website the customers identity remains
  anonymous.
• The customer retrieves proposals from the
  utilitys website.
• The customer can choose to contact an ESCO to
  discuss the proposal.
• Or the customer can authorize ESCOs to contact a
  designated representative.
• The ESCO must sign a confidentiality agreement
  that they will only use the customers data for
  this program.

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Market Expo

• CI customers are invited to a venue with ESCOs,
  utility reps and NYDPS reps.
• Customers can approve in advance the release of
  their customer data so that ESCO can prepare
  proposals and discuss the proposal during the
  Expo.
• The utility and NYDPS reps deliver the message
  that ESCOs must meet NYDPS, NYISO and utility
  requirements and switching will not affect
  delivery service.
• ESCOs can make brief presentations.

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Energy Fairs

• Via a multi-media blitz, residential customers
  are invited to a venue where ESCOs have
  booths/tables to market their products.
• The utility will have on-line access so that a
  customers can obtain their utility account number
  if they want to take advantage of an ESCO offer
  at the fair.
• The NYDPS will provide educational materials and
  assist customers in learning about questions they
  can ask ESCOs.
• Green power providers and NYSERDA may also
  participate.

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Utility Competition Education and Outreach Program

• Utilities can recover competition education
  program expenses that have been negotiated and
  included in rate cases.
• Examples include
• Market Match/Expos and Energy Fairs
• Bill inserts
• Newspaper, radio ads
• Community/business events
• Websites
• Brochures
• Direct mail 3rd party mailings

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NYDPS Competition Education Program

• We have a NYDPS budget for competition education
  that includes
• Community leaders and business chamber mailings
  and events
• Billboards
• Newspaper inserts
• Advertorials
• Sponsoring/participating in energy fairs and
  local events
• Brochures
• Mall kiosks
• PowerToChooseNY.com website
• Statewide awareness and understanding surveys
• Bus wraps and bus/subway platforms

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Coordinating NYDPS retail competition issues

• Coordination within the NYDPS is facilitated by
  the Office of Retail Market Development.
• Processing ESCO eligibility applications
• Ensuring customer protections
• Spearheading competition education programs
• Participating in rate cases on Staff teams
• Minimizing barriers to entry and maintaining a
  level playing field
• Solving infrastructure problems and resolving
  disputes
• Modifying the Uniform Business Practices and EDI
  transactions
• Developing affinity group aggregation
  opportunities
• Exploring retail auctions

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Near and Long-term Challenges

• Near-term Re-examining utility price
  transparency and portfolio management issues
  (current proceeding, Case 06-M-1017)
• ??
• ??
• Long-term Solving POLR and exiting the merchant
  function

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Contact Info

• For more info, please contact me at
• Benjamin Stein, Manager
• Market Operation and Design
• Office of Retail Market Development
• New York State Department of Public Service
• 3 Empire State Plaza
• Albany, NY 12211
• 518 486 2478
• benjamin_stein_at_dps.state.ny.us