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At the Maryland PSC administrative meeting, the Commission discussion indicated that the Commission expects to issue an order in the very near future addressing whether implementation of Supplier Consolidating Billing (SCB) should be paused.  During that same discussion the Commission indicated they will also ask parties to file briefs on the interaction of SCB and the newly retail energy reform law, SB 1.

As previously reported, on May 15, 2024, the joint utilities (Baltimore Gas and Electric Company, Potomac Electric Power Company, and Delmarva Power & Light Company) filed a Notice of Intent to Pause Work on Implementation of Supplier Consolidated Billing due to the passage of SB 1.  

Excerpts from Joint Supplier Comments:

In the May 15 Notice, the Exelon Utilities assert incorrectly that Senate Bill 1/House Bill 267 (“SB 1”) – and specifically, the provisions of SB1 that eliminate residential purchase of other affected parties continue working to complete the sole remaining EDI transaction necessary to implement SCB, pending further direction from the Commission.” receivables (“POR”) – somehow impacts the new SCB program. It does not. 

On June 6, 2024, Staff filed its Comments regarding the May 15 Notice. Among other things, Staff explained the long history of the SCB proceedings at the Commission and identified the legal issues arising out of the Exelon Utilities’ arguments. Staff recommends that the Commission direct parties to brief the legal question of whether SB1 will preclude the further development of SCB. Staff also recommends that “the Exelon Utilities, the EDI Workgroup, and other affected parties continue working to complete the sole remaining EDI transaction necessary to implement SCB, pending further direction from the Commission.”

Despite this long history of Commission commitment to SCB since 2017, as well as thousands of hours of stakeholder resources dedicated to a successful and smooth SCB implementation, the Exelon Utilities once again seek to halt the program or to extend the implementation deadline. Just recently, BGE sought a delay of SCB, arguing that the recently adopted HB 908, now codified in PUA § 7-306.2, compelled BGE to seek guidance on whether the new statute precluded community solar customers from participating in SCB. In Order No. 91117, the Commission held, among other things, that the “plain language of HB 908 does not preclude customer participation in both SCB and community solar.”3 Similarly, in the May 15 Notice, the Exelon Utilities are attempting to unreasonably and impermissibly stretch the plain language and intent of SB1 to delay, or even nullify, SCB. For the following reasons, the Petitioners encourage the Commission to enter an order rejecting the Exelon Utilities’ request to pause SCB implementation.

SB1 does not affect SCB as a billing option. This brings us to the plain language of SB1 and the extremely straightforward statutory analysis needed to dismiss the Exelon Utilities’ concerns raised in the May 15 Notice. As the Commission has recognized time and again: When determining the meaning and intent of a statute, the Maryland Supreme Court has stated that the analysis begins with “the plain language of the statute, and ordinary, popular understanding of the English language dictates interpretation of its terminology.” Kushell v. Dep’t of Natural Resources, 385 Md. 563, 576 (2005). (citations omitted). In construing the plain language of the statute, “a court may neither add nor delete language so as to reflect an intent not evidenced in the plain and unambiguous language of the statute; nor may it construe the statute with forced or subtle interpretations that limit or extend its application.” Id. The Court concluded that “[i]f the language of the statute is unambiguous as construed, according to its ordinary and everyday meaning, then we give effect to the statute as it is written.” Id. at 577, citing Collins v. State, 383 Md. 684, 688-89 (2004).12 The Exelon Utilities’ argument demonstrates a fundamental misreading of the plain language and intent of SB1’s provisions regarding the elimination of residential POR.

First, the plain and unambiguous statutory language ends the analysis quickly. The new POR prohibition is found in § 7-510(d), which begins by saying, very clearly, that the subsection is limited to residential supply charges as opposed to regulated charges: This subsection applies to residential electricity supply other than supply offered through: (I) Standard Offer Service; (II) The Department of General Services’ Sale of Energy under § 7-704.4 of this Title; or (III) A Community Choice Aggregator under § 7-510.3 of this Subtitle.13 By its express terms, subsection (d) of § 7-510 applies only to “residential electricity supply.” The POR prohibition is found in § 7-510(d)(4) – the same subsection that only applies to residential electricity supply.14 It says: A residential electricity supplier may not sell to an electric company, and an electric company may not purchase from the electricity supplier, accounts receivable.15 As explained above, POR for SCB involves the supplier’s purchase of regulated utility charges from the utility and the possible re-purchase by the utility of the same charges, at the same dollar amount, in the event of a customer nonpayment. POR for SCB has nothing to do with electricity supply charges. Rather, its purpose is to keep the risk of unpaid regulated charges with the utility and not transfer them to the SCB supplier. Therefore, the utilities’ concerns that SB1 might prohibit the purchase or sale of a regulated utility receivable are misplaced and cannot be the basis for pausing SCB implementation.

Petitioners agree with Staff that “the regulated utilities do not have the legal authority to unilaterally cease compliance with Commission Orders or regulations.” Petitioners agree with Staff that the COMARs and Order No. 89116, and ensuing orders issued in Case No. 9461, “make it clear that the utilities are required to implement SCB unless and until the Commission rescinds its prior directive and modifies the regulation.” As explained above, SB1 does not affect SCB as designed and should not be the basis for altering SCB’s scheduled implementation date.

Moreover, as the Commission has recognized in PC-60, much work is needed to implement the numerous provisions in SB1. The new law is expected to dramatically alter the retail supply landscape in Maryland. SCB provides suppliers and customers with an additional billing option and opportunity that is necessary given the uncertainty with SB1 and its implementation.

From OPC Comments:

Commission Staff has filed a bucksheet recommending that the Commission “direct parties to brief the legal question of whether SB1 will preclude the further development of SCB.”6 Staff further recommended that the Commission direct utilities and other affected parties to continue working to complete the remaining IT work needed before SCB transactions can be processed.7 As explained below, the Commission should: (1) direct Exelon not to pause its implementation of SCB; and (2) adopt Staff’s recommendation that this issue be briefed for thorough consideration of the effect S.B. 1 has on SCB.

OPC disagrees that SCB implementation should be paused at this time. As Staff points out, all customer classes, including commercial and industrial classes, will be able to participate in SCB. The new requirements under S.B.1 will not impact the purchase of receivables for non-residential customer accounts. Thus, the utilities will still need to have IT system updates in place for SCB to serve non-residential classes by the Commission deadline for SCB implementation by December 31, 2024. 

OPC agrees that the Commission should direct interested parties to file briefs on the effect S.B. 1 will have on SCB before taking action. While the new legislation undoubtedly has a legal effect on the SCB regulations, OPC agrees that other factual issues involving the implementation of SCB under S.B. 1 (such as the continued willingness of suppliers to participate in SCB without the purchase-of-receivables, or the costs and difficulties of utilities continuing to develop SCB capabilities) are relevant and should also be included in the filings. 

Joint Supplier Comments  (06/10/2024)
OPC Comments  (06/10/2024)
9461
In The Matter Of The Petition Of NRG Energy, Inc., Interstate Gas Supply, Inc., Just Energy Group, Inc., Direct Energy Services, LLC, and Engie Resources, LLC for Implementation Of Supplier Consolidated Billing For Electricity And Natural Gas In Maryland