Nancy Stevens Director, Consumer Division Massachusetts Department of Public Utilities July 27, 2015
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1 MASSACHUSETTS RETAIL ELECTRICITY MARKET DEVELOPING A SHOPPING WEBSITE Nancy Stevens Directr, Cnsumer Divisin Massachusetts Department f Public Utilities July 27,
2 OVERVIEW 1. Restructured Electric Market Backgrund 2. D.P.U Investigatin by the Department f Public Utilities n its wn Mtin int Initiatives t Imprve the Retail Electric Cmpetitive Supply Market 3. Develping a Shpping fr Cmpetitive Supply Website SLIDE 2
3 BACKGROUND Massachusetts restructured its retail electric industry in 1998 The delivery cmpnent f electric service Cntinues t be prvided as a mnply service by the electric distributin cmpanies The supply cmpnent f electric service Open t cmpetitin Basic Service serves as the regulated backstp supply ptin fr custmers that d nt chse cmpetitive supply SLIDE 3
4 DEPARTMENT S ROLE Licensing: The Department reviews Cmpetitive Supplier and Electricity Brker license applicatins and annual renewals. 220 C.M.R ; Infrmatin Disclsure: The Department is respnsible fr ensuring that custmers are presented with cnsistent infrmatin n the services ffered by cmpetitive suppliers. 220 C.M.R Cnsumer Cmplaints; Billing and Terminatin Cmpliance: The Department ensures that Suppliers, Brkers, and Agents cmply with ur billing and terminatin regulatins and reslve cnsumer cmplaints as necessary. 220 C.M.R ; Municipal Aggregatin: The Department renews and apprves municipal aggregatin plans. G.L. c. 164, 134. Rates: Nte that the Department des nt regulate the rates f participants in the restructured electric markets. SLIDE 4
5 LICENSED SUPPLIERS AND BROKERS As f year end 2014 there were: 66 licensed cmpetitive suppliers 212 licensed electricity brkers List f licensed suppliers and brkers available at: List f Licensed Electricity Suppliers, Brkers in Mass (n the right under Related Links ) SLIDE 5
6 A rbust cmpetitive supply market has yet t develp fr residential and small business custmers CURRENT STATUS OF ELECTRIC MARKET After 15 years int restructuring, nly ~17% f residential custmers and ~25% f small business custmers have migrated t cmpetitive supply SLIDE 6
7 PARTICIPATION IN COMPETITIVE Custmer Class MARKETS % f Custmers n Cmp Supply % f Lad n Cmp Supply Residential 17.2% 17.3% Lw Incme 25.3% 24.8% Small C&I 25.0% 45.1% Medium C&I 40.9% 58.5% Large C&I 73.5% 87.9% As f Nvember,
8 CHANGES IN COMPETITIVE SUPPLY MARKET Tw reasns why the Department has seen an uptick in mvement t cmpetitive supply: Implementatin f Purchase f Receivables Prgrams Mitigate the risk that suppliers bear regarding nnpayment by their custmers Expected that implementatin f these prgrams will result in increased activity in the cmpetitive supply market (particularly fr residential and small business custmers) Recent increases in Basic Service rates 60% 95% fr the past winter mnths Shuld mtivate cnsumers t evaluate cmpetitive supply ptins SLIDE 8
9 SLIDE 9 BASIC SERVICE RATES
10 D.P.U NOTICE OF INVESTIGATION D.P.U Issued n December 11, 2014 Overarching purpse f D.P.U : t ptimize the value that cnsumers realize frm the cmpetitive supply market Included several prpsals intended t ensure that cnsumers are prvided infrmatin regarding cmpetitive supply prducts that is accurate, nt misleading, and readily understandable Develping a Shpping fr Cmpetitive Supply Website SLIDE 10
11 SHOPPING FOR COMPETITIVE SUPPLY WEBSITE STAKEHOLDER PROCESS Technical sessins, cmments, prpsals, etc. Cmpetitive suppliers Distributin cmpanies Cnsumer advcacy grups Envirnmental rganizatins Attrney General Department f Energy Resurces ( DOER ) SLIDE 11
12 COMPETITIVE SUPPLY WEBSITE The purpse f the website is t allw custmers t effectively and efficiently shp fr cmpetitive retail electric supply prducts T ptimize usefulness f website, the Department seeks t strike balance between: OVERVIEW (i) prviding suppliers the pprtunity t list a brad range f prducts, and (ii) ensuring that prduct infrmatin is presented in a transparent and easily understd manner SLIDE 12
13 COMPETITIVE SUPPLY WEBSITE Underlying assumptins regarding website 1. Supplier participatin will be vluntary 2. Primary (if nt exclusive) audience fr the website will be small-usage custmers (i.e., residential and small C&I) OVERVIEW ( CONT.) Expectatin is that prducts listed n website will be ffered t custmer classes at large (rather than custmized t specific custmers) SLIDE 13
14 COMPETITIVE SUPPLY WEBSITE Three issues identified in Order (at 4-5): 1. Prduct-related infrmatin t be listed n website: Pricing Renewable energy cntent Fees Other characteristics Availability OVERVIEW ( CONT.) Service territry Rate/custmer class Mnthly usage SLIDE 14
15 COMPETITIVE SUPPLY WEBSITE 2. Rules gverning peratin f website, related t Unifrm presentatin f infrmatin Time perid during which prducts are available Custmer infrmatin Order f prduct listing 3. Website design features OVERVIEW ( CONT.) Display f prduct infrmatin Custmer preference ptins (e.g., filtering and srting) SLIDE 15
16 COMPETITIVE SUPPLY WEBSITE PROPOSED RULES PRESENTATION Unifrm Presentatin f Prduct Infrmatin T allw cnsumers t usefully cmpare prducts Prices will be listed in cents per kwh and $/mnth (if applicable) Fixed-price terms will be set at intervals f three mnths (e.g., 3 mnths, 6 mnths, 9 mnths, 12 mnths, etc.) Intrductry price discunts will be listed as an Other Prduct Characteristic SLIDE 16
17 COMPETITIVE SUPPLY WEBSITE PROPOSED RULES - PRESENTATION Unifrm Presentatin f Prduct Infrmatin Renewable energy cntent (fr prducts that exceed RPS requirements) Fees Listed in specified increments f ttal prduct cntent (e.g., 25%, 50%, etc.) Early cancellatin fees listed as fixed $ amunt r $/mnth early cancellatin SLIDE 17
18 COMPETITIVE SUPPLY WEBSITE Timing Availability f Prducts All prducts listed n the website shuld be available t custmers thrugh the same date Fr example: PROPOSED RULES - TIMING Prducts available thrugh midnight everyday SLIDE 18
19 SHOPPING FOR COMPETITIVE SUPPLY WEBSITE SLIDE 19 Texas:
20 CUSTOMER EDUCATION Overall gal is t educate cnsumers t help ensure that they have the necessary infrmatin t make the right energy chices fr them. SLIDE 20
21 COMPETITIVE SUPPLY ON CURRENT Helpful Resurces fr Cnsumers Regarding Electric Cmpetitive Supply Includes links t: DPU/ EEA WEBSITE What is Cmpetitive Supply? Cmpetitive Supplier Frequently Asked Questins Licensed Cmpetitive Suppliers and Electricity Brkers by Distributin Cmpany Cmplete List f Licensed Electricity Suppliers and Brkers Cnsumer Cmplaints Cntact Infrmatin SLIDE 21
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