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PowerOptions Becomes Connecticut Electric Aggregator

July 29, 2015 By Cheryl Kaften

The Connecticut Public Utilities Regulatory Authority (PURA) has approved the application of Boston-based PowerOptions to become an electric aggregator in the state, serving commercial, industrial, municipal and governmental customers.

PURA had originally categorized PowerOptions as a “broker/marketer and not as an aggregator as defined by law” on March 6, and had declined to issue the Boston-based nonprofit an aggregator license. PowerOptions asked PURA to reconsider its case, which the regulator did in Technical Meeting proceedings on June 18.

In its presentation at the meeting, PowerOptions – which claims to currently have 500 Massachusetts-based nonprofit members and to procure $200 million worth of power on their behalf annually – said that its services were not those of a broker or agent for a power supplier because the company:

  • Does not procure customers for a power supplier, but rather finds a power supplier for its members;
  • Acts in the interest of its members, using its membership’s buying power to leverage price, terms and conditions; and
  • Does not contract with an electric supplier to sell generation services, nor is it compensated by an electric supplier to sell generation services.

These were important proof points because, in Connecticut, an electric aggregator is defined under §16-1(a)(25) of the General Statutes of Connecticut as “a person ‘that gathers together electric customers for the purpose of negotiating the purchase of electric generation services from an electric supplier,’ provided such person ‘is not engaged in the purchase or resale of electric generation services, and provided further such customers contract for electric generation services directly with an electric supplier.”

Conn. Gen. Stat. §16-245o(h)(1) further provides: “Any third-party agent who contracts with or is otherwise compensated by an electric supplier to sell electric generation services shall be a legal agent of the electric supplier.”

With the additional verifying documentation in hand, Connecticut’s PURA now has found in favor of PowerOptions, noting that “The Authority rescinds its letter dated March 6, 2015, and hereby grants PowerOptions an Electric Aggregator Certificate of Registration.”

In addition to winning a reversal of its case in Connecticut, PowerOptions is attempting to scale up in Rhode Island, according to a recent story in the The Boston Globe.

PowerOptions CEO Cynthia Arcate told the newspaper that the aggregator had two major reasons for expanding beyond Massachusetts: First, to help nonprofits buy energy in New England– a region that is infamous for its astronomical electricity and natural gas prices. Second, and perhaps more pressing, to add more members — giving the growing aggregator more clout when negotiating contracts with suppliers.

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