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S05500 Summary:

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S05500 Floor Votes:

S05500 Text:

 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                         5500--D
 
                               2013-2014 Regular Sessions
 
                    IN SENATE
 
                                      May 16, 2013
                                       ___________
 
        Introduced  by  Sens.  BALL, CARLUCCI, LATIMER -- read twice and ordered
          printed, and when printed to be committed to the Committee  on  Energy
          and  Telecommunications -- committee discharged, bill amended, ordered
          reprinted as amended and recommitted to said  committee  --  committee
          discharged, bill amended, ordered reprinted as amended and recommitted

          to  said committee -- recommitted to the Committee on Energy and Tele-
          communications in accordance with Senate Rule 6, sec. 8  --  committee
          discharged, bill amended, ordered reprinted as amended and recommitted
          to  said  committee  --  reported  favorably  from  said committee and
          committed to the Committee on Finance --  committee  discharged,  bill
          amended,  ordered reprinted as amended and recommitted to said commit-
          tee
 
        AN ACT authorizing certain municipalities to participate in a  municipal
          energy  aggregation  program through an inter-municipal agreement with
          one or more municipalities in order to coordinate efforts  to  procure
          electric  and/or  gas  supply services on behalf of its residents; and
          providing for the repeal of such provisions upon expiration thereof
 

          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section  1.  Definitions.  The following terms, when used in this act,
     2  shall have the following meanings:
     3    1. "Resident" shall mean a customer of record who received residential
     4  or small non-residential electric and/or gas supply from a  distribution
     5  utility  at the time of a local resolution by his or her municipality to
     6  establish and/or participate in a municipal energy aggregation  program.
     7  Small  non-residential shall include the distribution utility's smallest
     8  general service rate schedule applicable to non-residential customers.
     9    2. "Distribution  utility"  or  "distribution  utilities"  shall  mean
    10  Consolidated  Edison (Con-Edison) and/or New York State Electric and Gas
    11  ("NYSEG").
 

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD11030-14-4
        S. 5500--D                          2
 
     1    3. "Participating customer" shall mean a resident who receives his  or
     2  her  electric  and/or  gas supply through a municipal energy aggregation
     3  program.
     4    4.  "Municipal  energy  aggregation  program" or "aggregation program"
     5  shall mean an inter-municipal agreement pursuant to article 5-G  of  the
     6  general  municipal  law or a local resolution for the purpose of coordi-
     7  nating or initiating efforts by a municipality or  by  municipal  energy
     8  aggregators  to request bids for and potentially select an ESCO or ESCOs
     9  to provide electric and/or gas supply to participating customers.

    10    5. "Energy services company" or "ESCO" shall have the same meaning  as
    11  such  term  is used in subdivision 5 of section 44 of the public service
    12  law.
    13    6. "Municipality" or "municipalities"  shall  mean  a  city,  town  or
    14  village located in Westchester county.
    15    7.  "Municipal  energy aggregator" or "energy aggregator" shall mean a
    16  municipality authorized pursuant to a local resolution to  establish  an
    17  aggregation  program  or  participate  in  an  inter-municipal agreement
    18  establishing a municipal energy aggregation program.
    19    8. "Program administrator" shall mean an employee that  is  designated
    20  pursuant  to an inter-municipal agreement pursuant to article 5-G of the
    21  general municipal law or, in the case of an aggregation program with one
    22  energy aggregator, an employee designated by such energy  aggregator  to

    23  fulfill the responsibilities of: (i) requesting and compiling historical
    24  usage data of distribution utility customers as required under this act,
    25  (ii)  submitting a request for bids for energy supply from ESCOs author-
    26  ized to supply electric and/or gas in New York state, and (iii) carrying
    27  out the administration of the contract and implementation of  aggregated
    28  supply.   Such responsibilities shall not be contracted or subcontracted
    29  out to any private or not-for-profit corporation or organization.
    30    9.  "Department" shall mean the New York department of public service.
    31    § 2. Municipal energy aggregation programs.  1.  A  municipality  may,
    32  after  adopting  a  resolution  approved  by a majority of its governing
    33  board, participate in a municipal energy aggregation program through  an
    34  inter-municipal  agreement  with  one or more municipalities in order to

    35  coordinate efforts, or through its own municipal aggregation program  to
    36  procure  electric  and/or  gas  supply  on behalf of its residents. Such
    37  municipal energy aggregation program must provide for the designation of
    38  a program administrator to facilitate  the  operations  of  a  municipal
    39  energy  aggregation program, including but not limited to the receipt of
    40  resident historical usage data information from  distribution  utilities
    41  pursuant  to  section three of this act and any communications necessary
    42  with potential ESCOs that would provide electric and/or gas  supply  for
    43  such program.
    44    2.  A  municipal energy aggregator shall be responsible for responding
    45  to inquiries  regarding  the  particular  municipal  energy  aggregation
    46  program  in  which it is a participant. Such municipal energy aggregator
    47  shall provide contact information, including but not limited to a  mail-

    48  ing address, telephone number, e-mail address and fax number at which it
    49  may be contacted in all notices to participating customers.
    50    3.  In  establishing a contract for an energy aggregation program with
    51  an ESCO, a program administrator shall comply  with  article  7  of  the
    52  public officers law.
    53    §  3.  Establishment  of  municipal energy aggregation program. 1. The
    54  program administrator designated pursuant to an  inter-municipal  agree-
    55  ment  establishing an aggregation program or a local ordinance authoriz-
    56  ing a municipality to become an energy aggregator shall provide  a  copy
        S. 5500--D                          3
 
     1  of  such  agreement  to  the  distribution utilities and submit a formal
     2  request for bulk usage information provided for under subdivision  2  of
     3  this section.

     4    2.  (a) Within 60 days of the establishment of a municipal aggregation
     5  program and after a formal request, distribution utilities shall,  at  a
     6  reasonable  cost  as  determined by the commission within 60 days of the
     7  effective date of this act, provide to  the  program  administrator  the
     8  following  utility bulk information regarding residents receiving gas or
     9  electric supply from such distribution utility:
    10    (i) the number of residents, by class served that do not receive elec-
    11  tric and/or gas supply from an ESCO or the power authority of the  state
    12  of New York;
    13    (ii)  the  aggregate  gas  and  electric  usage of residents, by class
    14  served, for the 12-month period preceding the request; the  system  peak
    15  hour  or  hours that determines capacity buying requirements, and to the
    16  degree that it is available the aggregated load factor by  class  served

    17  for the 12-month period preceding the request;
    18    (iii)  the  average  monthly per kWh and per Btu supply rates by class
    19  served charged by the distribution utility for the previous  12  months;
    20  and
    21    (iv) to the degree that it is available, reasonable efforts to provide
    22  more  detailed  historic information relating to energy usage character-
    23  istics of customers, including but not limited to  information  by  rate
    24  class  on  meter type, kWh usage and peak demand information classifica-
    25  tion, meter reading cycle information, load profile designating informa-
    26  tion, the number of customers enrolled in  budget  billing  plans,  loss
    27  factor  information,  net  metering information, individual capacity tag
    28  information and any other  information  deemed  useful  by  the  program
    29  administrator  to successfully solicit bids for and implement the aggre-
    30  gation program;

    31    (b) In providing the utility  bulk  information  required  under  this
    32  subdivision,  a  distribution  utility  shall  not  provide to a program
    33  administrator any information  identifying,  by  name  or  address,  any
    34  customer  of  such  utility  or  the  financial  information of any such
    35  customer, including, but not limited to social security numbers,  credit
    36  card or bank account numbers.
    37    §  4.  Selection  of  ESCO  providers. 1. Upon receipt of utility bulk
    38  information required under section three of this act, the program admin-
    39  istrator is authorized to advertise for the request of bids  from  ESCOs
    40  for  the provision of supply for an aggregation program. Any request for
    41  bids shall specify that a contract for an aggregation program must:
    42    (a) be limited to a period of no greater than 30 months;
    43    (b) include price benchmarks, which shall provide for:

    44    (i) in the case of a contract that includes electric supply,  a  fixed
    45  monthly  per  kWh  supply  rate for the first 6-month sub-period that is
    46  below the average monthly rate of supply provided  by  the  distribution
    47  utility in the previous 12-month period;
    48    (ii)  a  commitment  to provide fixed monthly per kWh supply rates for
    49  each subsequent  6-month  sub-period,  and  a  commitment  by  the  ESCO
    50  selected  to notify the program administrator of the kWh supply rate for
    51  the upcoming sub-period no later than two months prior to the  commence-
    52  ment of each such sub-period pursuant to section seven of this act;
    53    (iii)  in  the  case  of  a contract that includes gas supply, a fixed
    54  monthly per Btu supply rate for the first  6-month  sub-period  that  is
    55  below  the  average monthly price of supply provided by the distribution
    56  utility in the previous 12-month period; and

        S. 5500--D                          4
 
     1    (iv) a commitment to provide fixed monthly Btu supply rates  for  each
     2  subsequent  6-month sub-period, and a commitment by the ESCO selected to
     3  notify the program administrator of the Btu supply rate for the upcoming
     4  sub-period no later than 2 months prior to the commencement of each such
     5  sub-period pursuant to section seven of this act;
     6    (c)  provide  that  the  ESCO  will  not levy any form of cancellation
     7  charge to participating customers who, after receiving  electric  and/or
     8  gas  supply  from  the  ESCO,  choose  to receive such supply from their
     9  respective distribution utility;
    10    (d) provide for a website for  participating  customers  to  view  the
    11  monthly rates charged for electric and/or gas supply; and
    12    (e)  provide  that any costs associated with preparation for or imple-

    13  mentation of this program or contract shall only  be  reflected  in  the
    14  benchmark per kWh and/or per Btu fixed rate.
    15    2.  (a)  After  a  review  of bids submitted for energy supply, energy
    16  aggregators are authorized to select the ESCO or ESCOs that  will  offer
    17  the  best  service, price and any other factors, determined to be appro-
    18  priate, provided that the per kWh rate for electric supply and  per  Btu
    19  rate for gas supply for the first 6-month sub-period are below the aver-
    20  age  monthly price of supply provided by the distribution utility in the
    21  previous 12 months and meet the requirements of subdivision  1  of  this
    22  section,  provided  that  energy  aggregators,  may at their discretion,
    23  reject all bids or offers and readvertise for new bids or offers in  the
    24  manner provided by this act.
    25    (b)  In  making  a  selection, energy aggregators shall (i) select one

    26  ESCO for the provision of electric supply; and (ii) select one ESCO  for
    27  the  provision  of gas supply, provided however that the energy aggrega-
    28  tors may select an  ESCO  to  provide  both  electric  and  gas  supply,
    29  provided  further  that  energy aggregators may not select any ESCO that
    30  has been deemed ineligible to provide energy services by the department.
    31    3. The energy aggregator  or  aggregators  shall  document,  and  make
    32  available upon request, the process used for the selection of an ESCO or
    33  ESCOs  including,  but  not limited to documenting all bids received and
    34  the criteria and factors used for the selection process.
    35    4. After selection of an ESCO or ESCOs,  the  energy  aggregators  are
    36  authorized  to  enter  into  a  contract  for energy aggregation program
    37  services of up to 30 months. Such contract shall include:

    38    (a) provisions prohibiting the ESCO or ESCOs from denying service to:
    39    (i) in the case of a contract that includes electric supply, any resi-
    40  dent receiving service from his  or  her  distribution  utility  at  the
    41  commencement of such contract; and
    42    (ii)  any customer of record of a distribution utility receiving resi-
    43  dential or small non-residential services whose municipality is an ener-
    44  gy aggregator in the aggregation program for which  the  ESCO  or  ESCOs
    45  will provide supply;
    46    (b)(i)  a  provision requiring a fixed monthly per kWh supply rate for
    47  the first 6-month sub-period that is below the average monthly price  of
    48  supply  provided  by  the  distribution utility in the previous 12-month
    49  period; and
    50    (ii) a provision requiring the ESCO to provide fixed monthly  per  kWh
    51  rates  for  each subsequent 6-month sub-period; and that no later than 2

    52  months prior to the commencement of each 6-month  sub-period,  the  ESCO
    53  shall notify the program administrator of the fixed monthly per kWh rate
    54  for such upcoming sub-period, pursuant to section seven of this act;
    55    (c)(i)  a  provision requiring a fixed monthly per Btu supply rate for
    56  the first 6-month sub-period that is below the average monthly price  of
        S. 5500--D                          5
 
     1  supply  services  provided  by  the distribution utility in the previous
     2  12-month period; and
     3    (ii)  in  the case of a contract that includes gas supply, a provision
     4  requiring the ESCO to provide fixed  monthly  per  Btu  rates  for  each
     5  subsequent  6-month sub-period; and that no later than 2 months prior to
     6  the commencement of each 6-month sub-period, the ESCO shall  notify  the

     7  program  administrator of the fixed monthly per Btu rate for such upcom-
     8  ing sub-period, pursuant to section seven of this act;
     9    (d) provisions requiring the ESCO or ESCOs to provide electric  and/or
    10  gas  supply  rates lower than the distribution utility's electric and/or
    11  gas supply rates pursuant to paragraphs (b) and (c) of this subdivision,
    12  provided that a violation of this provision shall subject such  ESCO  to
    13  refund  participating customers at the time of termination of a contract
    14  pursuant to section nine of this act;
    15    (e) provisions prohibiting a municipal energy aggregator from  opting-
    16  out of the contract during the term of such contract;
    17    (f)  provisions for the termination of a contract for an energy aggre-
    18  gation program if an ESCO fails to meet the  requirements  of  this  act
    19  with  the  ESCO  having  exclusive  responsibility for all re-entry fees

    20  charged to a participating customer by distribution  utilities  for  the
    21  resumption of supply;
    22    (g)  provisions  indemnifying energy aggregators from all liabilities,
    23  damages and costs associated with the performance of an  ESCO  operating
    24  under a contract for an energy aggregation program; and
    25    (h) a requirement that the ESCO provide a performance bond if required
    26  by the energy aggregators.
    27    5.  Immediately following the finalization of a contract for an energy
    28  aggregation program pursuant to subdivision four of  this  section,  the
    29  program  administrator  shall  promptly  notify the distribution utility
    30  and/or distribution utilities of  such  contract,  the  length  of  such
    31  contract and the distribution utility's responsibilities under this act.
    32    §  5.  Notice  of  municipal  energy aggregation contract required. 1.

    33  Upon the completion of the contract for an  energy  aggregation  program
    34  provided  for  under  subdivision three of section four of this act, the
    35  program administrator shall obtain  from  distribution  utilities  at  a
    36  reasonable  cost  as  determined by the commission within 60 days of the
    37  effective date of this act their lists of residents that may be affected
    38  by such contract and provide the municipal energy aggregators with  such
    39  information.  Each  municipal  energy  aggregator shall then notify such
    40  residents as to the provisions  of  such  contract,  including  but  not
    41  limited to price benchmarks.
    42    2.  Distribution  utilities  shall make all reasonable preparations to
    43  release residents who do not choose to opt-out pursuant  to  subdivision
    44  three  of  this  section  from  receiving  electric  and/or  gas supply,

    45  provided that all residents shall continue to receive delivery from such
    46  utilities.
    47    3. Upon completion of a contract provided for under subdivision  three
    48  of  section  four  of this act, municipal energy aggregators must mail a
    49  notice to each resident which shall include:
    50    (a) that the resident's municipal board has chosen to participate in a
    51  municipal energy aggregation contract;
    52    (b) that unless he/she elects to opt-out within 60 days of  the  post-
    53  marked  notice,  such  resident will become a participating customer and
    54  will receive electric and/or  gas  supply  through  a  municipal  energy
    55  aggregation contract;
        S. 5500--D                          6
 
     1    (c)  instructions  detailing  how  a  resident  may  submit an opt-out
     2  response, provided that such procedures shall  permit  the  resident  to

     3  opt-out  by  contacting  the  program administrator and/or ESCO or ESCOs
     4  selected pursuant to the contract;
     5    (d)  that  each  resident  who  does  not  elect to opt-out within the
     6  prescribed period and becomes a participating  customer,  may  elect  to
     7  opt-out of such contract at any time; and
     8    (e)  that  in  the  case  of a participating customer the distribution
     9  utility will no longer be responsible for supply rates charged  to  such
    10  customer  and  that  all  complaints  about supply under the aggregation
    11  contract shall be the responsibility of the municipal energy  aggregator
    12  in which the customer resides and ESCO or ESCOs.
    13    4.  Immediately  following  the  60-day opt-out period provided for in
    14  paragraph (b) of subdivision three of this section, a  municipal  energy
    15  aggregator  shall  provide  the program administrator with the following
    16  information:

    17    (a) the number of residents that received electric and/or  gas  supply
    18  from  such  distribution utility who are participating customers by rate
    19  class; and
    20    (b) the name,  address,  and  account  number  of  each  participating
    21  customer.
    22    5.  The  program  administrator,  upon receipt of information required
    23  under subdivision four of this section, shall  submit  such  information
    24  and  the information provided for under subdivision two of section three
    25  of this act to the ESCO or ESCOs. Such  ESCOs  shall  commence  electric
    26  and/or gas supply to participating customers.
    27    § 6. Distribution utility requirements following a contract for aggre-
    28  gation  program services. No later than 2 weeks preceding the expiration
    29  of the initial 6-month sub-period under a contract for an energy  aggre-
    30  gation  program  and  any subsequent 6-month sub-period pursuant to such

    31  contract for  an  aggregation  program,  a  distribution  utility  shall
    32  provide the program administrator with:
    33    1. the average monthly per kWh rate for supply by class served for the
    34  previous 6-month period; and
    35    2. the average monthly per Btu rate for supply by class served for the
    36  previous 6-month period.
    37    § 7. ESCO supply rate notification requirements. 1. For the sub-period
    38  commencing  after  the  initial sub-period provided for under a contract
    39  for an energy aggregation program, the ESCO or ESCOs shall  provide  the
    40  program  administrator with the fixed monthly per kWh supply rate and/or
    41  the fixed monthly per Btu supply rate for the upcoming 6-month  sub-per-
    42  iod.
    43    2. Any expenses incurred by an ESCO or ESCOs, including but not limit-
    44  ed  to  expenses  incurred  in the execution of a contract for an energy

    45  aggregation program pursuant to section four of this act, shall only  be
    46  recovered  from  the  per  kWh  supply  rate  and/or per Btu supply rate
    47  charged to participating customers pursuant to  a  contract  for  energy
    48  aggregation  services.  The  ESCO  or ESCOs selected shall not issue any
    49  charge, fee, or bill for aggregation program services to an  aggregator,
    50  resident,  participating  customer  or  program administrator to recover
    51  expenses, including, but not limited to expenses incurred for:
    52    (a) electric and gas supply procurement;
    53    (b) taxes, assessments, fees and surcharges;
    54    (c) wheeling and/or transfer costs; and
    55    (d) administrative charges, expenses, staff and consultant costs.
        S. 5500--D                          7
 
     1    § 8. Notice of 6-month fixed rate. 1. No later than 2 months prior  to

     2  the  commencement  of  each  6-month  sub-period under a contract for an
     3  aggregation program,  the  program  administrator  shall  mail  to  each
     4  participating customer a notice that shall provide the fixed monthly per
     5  kWh  rates and/or fixed monthly per Btu rates for such upcoming sub-per-
     6  iod.
     7    2. No later than 6 months after the commencement of a contract for  an
     8  aggregation  program and every six months thereafter, the program admin-
     9  istrator shall mail to each  participating  customer  a  statement  that
    10  shall provide:
    11    (a)  the average per kWh and/or per Btu rate for supply for the previ-
    12  ous 6-month sub-period charged by  the  distribution  utility,  provided
    13  that  such  rates  shall  only be the actual supply rates charged by the
    14  utility, and shall not include any delivery rates, service  charges,  or

    15  taxes, assessments, fees and surcharges recovered from customers;
    16    (b)  the  fixed  monthly rate charged by the ESCO and/or ESCOs for the
    17  previous 6-month sub-period;
    18    (c) the fixed monthly per kWh rates and/or fixed monthly per Btu rates
    19  to be charged by an ESCO and/or ESCOs for such upcoming sub-period; and
    20    (d) instructions detailing how a resident may submit an opt-out.
    21    3. If any word, statement, notice or any other information required by
    22  or under the authority of this act appears in any letter, email  or  any
    23  other written communication to a recipient, including but not limited to
    24  a  resident  or  participating customer, such word, statement, notice or
    25  other information must be prominently placed thereon with such conspicu-
    26  ousness (as compared with other words, statements, designs, devices also
    27  included thereon) and in such terms as to render it likely  to  be  read

    28  and  understood  by an ordinary individual under customary conditions of
    29  purchase and use.
    30    Any letter, email or other written communication from an ESCO  seeking
    31  to  or  selected to provide energy aggregation program supply, a program
    32  administrator, or an energy aggregator, to a customer  or  participating
    33  customer relating to an energy aggregation program shall be written in a
    34  conspicuous font size of 12 point or greater.
    35    §  9.  Public  service  commission  review.  1. Within 365 days of the
    36  commencement of gas and/or electric supply services under an aggregation
    37  contract, the commission, after consultation with the  department  shall
    38  commence  an  audit  to  ensure  such ESCO or ESCOs selected has met the
    39  terms of its contract.
    40    2. (a) If the commission determines that the ESCO or  ESCOs  providing

    41  gas  and/or  electric  supply  has  failed  to  achieve the terms of its
    42  contract, the contract for an  energy  aggregation  program  established
    43  pursuant  to  subdivision  3 of section four of this act shall be termi-
    44  nated immediately.
    45    (b) Within 30 days of the termination of  a  contract  for  an  energy
    46  aggregation  program, the ESCO shall issue payment to each participating
    47  customer for any supply rates above those  specified  in  the  contract,
    48  including the cost of any applicable re-entry fees charged to a resident
    49  for resumption of supply.
    50    (c)  The  commission  shall  ensure  that  all  residents eligible for
    51  resumption of electric and/or gas supply from their respective  distrib-
    52  ution  utility  receive such services regardless of the actual timing of
    53  the payment provided for under paragraph (b) of this subdivision.

    54    3. An ESCO shall not levy any charge to an energy aggregator to  cover
    55  expenses related to the termination of a contract.
        S. 5500--D                          8
 
     1    § 10. Within 30 months of the establishment of a contract for an ener-
     2  gy  aggregation  program  or  upon the termination of such contract, the
     3  commission shall submit a report to the executive, the temporary  presi-
     4  dent  of  the  senate,  the  speaker  of the assembly, the chairs of the
     5  senate  energy  and telecommunications committee and the assembly energy
     6  committee detailing the performance of any  aggregation  contract.  Such
     7  report shall include the following information:
     8    1. the number of participating customers served;
     9    2.  the  ability  of  the  ESCO or ESCOs selected under an aggregation
    10  program to provide adequate supply services;

    11    3. the actual kWh and/or Btu supply rates charged under a contract for
    12  an energy aggregation program;
    13    4. the amount, if any, of participating customers whose residential or
    14  non-residential service was disconnected; and
    15    5. any other information the public service  commission  deems  neces-
    16  sary.
    17    § 11. Energy services company bill of rights applicable to participat-
    18  ing  customers.  For purposes of this act the term "customer" as defined
    19  in paragraph (c) of subdivision 1 of section 349-d of the general  busi-
    20  ness law, shall include participating customers.
    21    §  12. This act shall take effect immediately; and shall expire and be
    22  deemed repealed 5 years after such date.