Summit on Residential Electric Submetering May 16, 2009 Douglas W. Elfner, Ph.D. Jean Lowe Office of Consumer Services Department of Public Service

2 Key Policy Issues Concerning Submetering Consumer Protections Energy Efficiency Equity Among Energy Users

3 Brief History of PSC Residential Submetering Regulation Early Years – Active encouragement 1951 – Residential Submetering Outlawed Mid-1970’s – Rent Inclusion banned in new buildings after 1/1/1977 Late 1970’s – Commenced case-by-case review for existing buildings 1980’s – Current - Submetering reviews streamlined, consumer protections added

4 Process for Review of Proposals to Submeter in Existing Master Metered Residential Buildings Formal filing required Public Notice provided, public input accepted for minimum of 45 days DPS Staff reviews to ensure all requirements have been satisfied If requirements satisfied, PSC votes Formal PSC Order issued Before PSC approval, submeters can be installed, but not used to establish electricity charges

5 Requirements for Approval of Submetering in Existing Master Metered Residential Buildings Must Notify Tenants of the Affected Buildings –In writing –Explain submetering, its benefits and consumer protections –Include invitation to comment to PSC, with contact information Must show an economic advantage over direct metering Must describe the submetering system and verify its reliability and accuracy Must explain how electric rates will be calculated – Charges cannot exceed those of direct metered utility customers Must include description of complaint procedures Must include a description of an appropriate rent reduction formula

6 Recent PSC Actions Regarding Submetering in Existing Master Metered Residential Buildings Four “Stay orders” – February 2009 On-going review of Regulations

7 Consumer Protections 1981 – Home Energy Fair Practices Act (HEFPA) 2002 – Energy Consumer Protection Act amends HEFPA –Provides protection to ESCO customers and those who are submetered

8 HEFPA Protections Include Termination Procedures Deferred Payment Agreements Budget or Levelized Billing Late Payment Charges Special Protections Complaint Resolution Procedures

9 Complaint Procedures Contact the Service Provider Helpline – Hotline AskPSC.com, Click Utility Complaints & Statistics PSC will work with the submeterer and/or owner to resolve the matter with the customer PSC will issue a written determination as needed Parties have the right to an Informal Hearing or Review Parties have the right to Appeal to the Commission