operating a dual POR and non-POR billing system would be costly and time consuming to implement, given the different consumer protections and shut-off procedures that would presumably apply to the separate customer groups. Id. In their comments, Equitable, Dominion Peoples, OSBA, NFG and UGI also address the discount rate offered for accounts receivables. All of these comments reference the fact that the differences between NGSs customer bases could warrant differences in the discount rate between marketers within a POR program. Further, both EAP and NFG state that there is an inconsistency in the proposed regulation regarding the potential discount at which an NGDC will purchase receivables from an NGS. NFG Comments at pp. 14-15. EAP Comments, p. 6. In particular, both commenters note that section 62.224(a)(3) references a standardized discount while section 62.224(a)(4) states that the NGDC will establish a negotiated discount on a case-by-case basis. Id. NFG states that these two concepts are incompatible because either there is a discount that covers the various costs or there is a negotiated discount. Id. NFG asserts that the NGDC should be permitted to calculate a discount rate based on its experience with uncollectibles in its service territory and the Commission should then approve that rate. Id. In comments, the OCA and PECO state that the NGDC should be allowed to offer discounts so as to recover the NGS uncollectible expenses and the implementation, operating, administrative, and incremental costs associated with the POR. NFG further states that the regulation should provide for a “risk factor” component to the discount rate established by the NGDC. Id. NFG explains that in any area of business, companies who purchase accounts receivable do not do so at a dollar-for-dollar basis. Rather, a discount is always applied to the risk the purchasing entity takes with respect to uncollectibles. NFG further explains that among the risks an NGDC would take in implementing a POR program are the risk of uncollectible accounts and the
In our proposed regulation regarding POR programs, we essentially adopted the interim guidelines with a few modifications. In the proposed regulation, and in a departure from the interim guidelines, we stated that we will not require NGSs participating in POR programs to use only NGDC consolidated billing services. We determined that forcing NGSs to use the utility’s billing system could have the unintended effect of stifling innovative products such as demand response, efficiency or green products. Nevertheless, several commenters opposed this change from the interim guidelines. In regards to the comments on this upon further consideration, we agree with the commenters that requiring NGSs participating in POR programs to use consolidated billing from the NGDC is a prudent and necessary step. We believe that consolidated billing eases an NGDC’s costs and operations. We note that POR programs are normally provided in conjunction with consolidated billing in which the utility issues a single bill to the end user that contains the utility’s delivery charges and the NGS’ supply charges. Thus, we will amend Section 62.224(a)(2) of the regulation so as to now require that an NGS use consolidated billing in order to qualify for participation in a POR program. Nevertheless, to the extent an NGS is providing a service or product to customers that an NGDC’s consolidating billing system cannot accommodate or the NGS wants to offer products that are bundled with non-basic services, the NGS may be permitted to issue a separate bill for such service or product for that customer. See generally Petition of PECO Energy Company for approval of its Revised Electric Purchase of Receivables Program, Docket No.P-2009-2143607 (Order entered June 16, 2010). Also, in lieu of simply providing for a waiver opportunity and its attendance cost, delay and uncertainty, we have revised the final form regulation to specify the two (2) circumstances in which consolidated billing is not required to qualify for the POR program: (1) the NGDC’s billing system cannot accommodate the NGS bill for basic supply service; and (2) the NGS is providing a service or product that does not meet the definition of basic natural gas supply.