Power Supply Strategies,
Colonial Power Group, Inc.
Last month the New Hampshire Public Utilities Commission (PUC) approved the initial set of rules that formalize the operational details that will allow Community Choice Aggregations (CCA) to move forward. The PUC’s approval was a critical step toward what many believe will be a transformative advancement of customer choice for residential and small business electricity consumers in the state. This anticipation is hardly theoretical. CCA programs in many other states, including Massachusetts, have delivered significant and measurable benefits for participating consumers compared to utility default service, both in terms of price and in meeting local objectives to support a greater mix of renewable energy.
On September 16, a Joint Legislative Committee (JLCAR) will meet to review and adopt the PUC’s rules, confirming that the PUC’s rules meet the intent of state statutes. We expect a limited number of minor refinements. Once finally adopted, the electric utility companies are then required to file purchase of receivables (POR) program proposals with the PUC within 90 days. As covered in our June Newsletter, POR programs are critical for competitive suppliers to offer their services to CCA programs. We are working to facilitate meetings amongst the parties to expedite the process.
While the PUC completing its thoughtful review was certainly important, more noteworthy was its manner of approval and its very public enthusiasm for CCA success. In its final approval, the PUC exhibited deference to the proposed rules that were offered by stakeholders. The proposed rules were the result of an extensive stakeholder negotiation that included CCA proponents, the Office of Consumer Advocate, the NH Department of Energy, and the state’s utility companies. To their credit, the PUC rejected most requests to modify the proposed rules, largely coming from the utility companies. During the final public hearing, Commissioner Simpson harkened back to the original intent of electric restructuring in the late 1990s and making consumer choice possible for electric consumers. He recognized the promise that CCA will offer to consumers, particularly residential and small commercial customers who, even after 20-plus years, have largely failed to receive any direct benefit from restructuring. Commissioner Chattopadhyay commented on the importance of removing limits or restrictions on the flow of information from utility companies to CCA programs. Commissioner Simpson stated his belief that CCA “will transform the state’s electricity supply market by enabling communities to select their supplier and resource mix directly.” He applauded the return of “decision making to local control, so the citizens of every New Hampshire community have a voice to directly express what they want as an electricity customer.”
Their comments were consistent with a philosophy that supports market approaches. Importantly, their comments highlight the importance of heralding local control and decision-making. It suggests maintaining an assistive regulatory construct and one that does not impede market creativity and flexibility. It suggests not interfering with local interests, who are experienced at challenging businesses and industries to develop, explore, work, compete, and ultimately satisfy program objectives defined through local processes. The Commissioners’ comments and the underlying philosophies are critical for CCA programs to thrive. Recognizing and respecting the authority and prudency that local officials routinely undertake on behalf of their constituents—their neighbors—is a key ingredient for home-grown programs to succeed. This is a recognition sorely lacking in other states. Consequently, I will not be surprised if, within the next five years, CCA programs in Massachusetts are looking with envy at the creative and high-value programs flourishing in New Hampshire.
What is a Community Choice Aggregation Program?
- A CCA Program is an optional buying group organized by a municipality or group of municipalities to benefit electric customers.
- The Program enters into an electricity supply contract for all residential and business customers currently receiving utility default service within a given municipality.
- Customers are automatically enrolled, unless they opt-out.
Explore other energy industry articles in our September Newsletter to help you make informed decisions for your business.
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