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

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New York StateDepartment of Public Service

Retail Energy CompetitionPrograms and Strategies

National Energy Marketers AssociationFall 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 ESCO’s receivables.

• Without recourse, at a discount.

• The discount represents the utility’s 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 utility’s 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 O&R, now named PowerSwitch.• Residential switching at O&R 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)

• RG&E - (in development)

• KeySpan - (pending rate and merger proceeding)

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Market Match

• C&I 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 utility’s website – the customer’s identity remains anonymous.

• The customer retrieves proposals from the utility’s 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 customer’s data for this program.

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Market Expo

• C&I 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)

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• 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

• [email protected]