RI Lt. Governor Promotes Retail Competition

Rhode Island Lieutenant Governor Daniel McKee has been a strong proponent of energy choice. On February 5, the Warwick Beacon reported that McKee has promoted the idea of an energy shopping website. He also promoted the concept of a “purchase of receivables,” which is in place in neighboring Massachusetts and Connecticut.

A Massachusetts DPU website explains that a POR program is intended to mitigate the risk to suppliers of customers not paying their bills. Under a POR arrangement, distribution utilities purchase all receivables from competitive suppliers—including nonpaying accounts, which typically add up to a few percentage points of margin. Some have criticized this approach because, arguably, it it removes the incentive for suppliers to screen customers and ensure they have a history of paying their bills and has the potential to shift costs from retail customers to utility customers.

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