THE PUBLIC SERVICE COMMISSION HAS THE STATUTORY AUTHORITY TO IMPOSE RATES CHARGED FOR GAS AND ELECTRICITY BY ENERGY SERVICE COMPANIES 3RD DEPT.

The Third Department determined the Public Service Commission (PSC) has the power to regulate the rates charged by energy service companies (ESCO’s) in an effort to bring down the cost of gas and electricity for mass market consumers. The rates imposed by the PSC were included in a Reset Order. The petitioner, the Retail Energy Supply Assn., challenged the statutory authority of the PSC to issue the Reset Order imposing the new rates:

We … find … that the PSC’s broad statutory jurisdiction and authority over the sale of gas and electricity authorized it to impose the limitations set forth in the Reset Order. Pursuant to Public Service Law § 5, “[t]he jurisdiction, supervision, powers and duties of the [PSC] shall extend . . . [t]o the manufacture, conveying, transportation, sale or distribution of gas . . . and electricity . . . to gas plants and to electric plants and to the persons or corporations owning, leasing or operating the same” … . The emphasized language speaks to general authority over the sale of gas and electricity, followed by the specific extension of the PSC’s jurisdiction over gas and electric plants. Importantly, there is no dispute that the PSC is authorized to set “just and reasonable” tariff rates for gas and electric corporations pursuant to Public Service Law articles 1 and 4 … . In fact, it is the PSC’s broad jurisdiction that enabled it to allow ESCOs access to utility systems in the first place. The PSC essentially maintains that this same authority allows it to impose limitations on ESCO rates as a condition to continued access. We agree. * * *

As explained in the Reset Order, the PSC discerned that most ESCOs only offered commodity resale to their customers in direct competition with utilities. In doing so, ESCOs have had difficulty competing because the PSC “requires utilities to flow through energy commodity to end-users at cost, without a markup.” In consequence, numerous customer complaints have been made that ESCOs are charging more than the utilities — a result contrary to the very purposes of opening up the energy market in the first place, i.e., to promote lower energy costs to consumers. The rule change was implemented because the PSC determined that “it is not in the public interest for ESCOs to provide commodity supply only products for mass market customers.” This decision falls within the PSC’s broad authority to assure that “just and reasonable rates” are charged for gas and electric sold to the consumer, consistent with its authority over utilities … . Accordingly, we agree with Supreme Court that the PSC had jurisdiction to impose the rate limitations set forth in the Reset Order. Matter of Retail Energy Supply Assn. v Public Serv. Commn. of The State of New York, 2017 NY Slip Op 05908, 3rd Dept 7-27-17

 

UTILITIES (THE PUBLIC SERVICE COMMISSION HAS THE STATUTORY AUTHORITY TO IMPOSE RATES CHARGED FOR GAS AND ELECTRICITY BY ENERGY SERVICE COMPANIES 3RD DEPT)/PUBLIC SERVICE COMMISSION (THE PUBLIC SERVICE COMMISSION HAS THE STATUTORY AUTHORITY TO IMPOSE RATES CHARGED FOR GAS AND ELECTRICITY BY ENERGY SERVICE COMPANIES 3RD DEPT)/ENERGY SERVICE COMPANIES (THE PUBLIC SERVICE COMMISSION HAS THE STATUTORY AUTHORITY TO IMPOSE RATES CHARGED FOR GAS AND ELECTRICITY BY ENERGY SERVICE COMPANIES 3RD DEPT)

Copyright © 2019 New York Appellate Digest.