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Utility Default Service

Community Power programs maintain competitive default rates compared to utility default service rates, while also offering voluntary products that retail customers may opt-in to receive.

The timing of our Members’ rate setting decisions and, to a certain degree, the procurement of electricity will therefore need to take into account when the distribution utilities conduct these same activities.

 

Eversource, Liberty Utilities and Unitil all issue requests for proposals (RFPs) twice annually for competitive suppliers to assume load-serving entity obligations and supply default customers with electricity for 6-month “strip” periods, with suppliers bidding to serve individual “tranches” or segments of customers by class.

The procurement schedules, tranches and rate practices for each distribution utility are:

  • Eversource (Public Service Company of New Hampshire): issues RFPs in May and November for suppliers to begin serving customers in August and February, offering four ~100 MW tranches to serve small customers and a single tranche to serve large customers (five tranches in total). Retail rates are fixed over the 6-month period for small customers and vary by month for large customers.

  • Liberty Utilities: follows the same supplier RFP schedule and retail pricing as Eversource but (1) solicits supply for small customers in a single 6-month block tranche and for large customers in two, consecutive three-month block tranches (3 tranches total), and (2) allows bidders to include and price RPS compliance obligations separately (as an additional product).

  • Unitil: issues RFPs in March and August for delivery beginning in June and December, offering tranches of residential, small commercial, outdoor lighting and large customers classes (four tranches). The large customer RFP is structured in a distinct fashion, in that it passes through market costs for energy and so suppliers compete to price capacity, congestions, ancillary services, etc. for the large customer tranche over the 6-month term; retail rates reflect these load-serving entity costs along with the pass-through of real time locational marginal market prices (which are load-weighted by the entire class’ hourly load shape i.e., not the individual large customer’s usage profile). Retail rates for the residential, small commercial, and outdoor lighting classes are fixed over the 6-month term, though customers have the option to choose variable monthly pricing if the election is made prior to the start of the next 6-month term.

 

Supplier bids are priced in dollars per megawatt-hour ($/MWh) on a monthly basis and generally exclude Renewable Portfolio Standard (RPS) compliance obligations, though Liberty Utilities allows RPS compliance obligations to be bid as a separate product.

 

New Hampshire’s RPS requires all electricity suppliers to procure or otherwise obtain RECs for four distinct “classes” of renewables, each distinguishing between different technologies and dependent upon the year that the generators came online.

 

For 2021, the utilities are required to include 21.6% renewable energy in their energy supply. This minimum compliance requirement will increase incrementally to 25.2% by 2025 and remain fixed thereafter, absent an increase in the RPS.