Regulatory Intervention

On behalf of its clients, Luthin Associates frequently intervenes in Public Service Commission (PSC) proceedings and rate cases to keep prices low, achieve favorable outcomes and ensure that generators, retailers, and utilities do not shape energy policy to their advantage. We also intervene to represent clients at the Federal Regulatory Commission (FERC) and New York Independent System Operator (NYISO) to achieve these same cost-reducing and opportunity-maximizing goals. We care about our clients’ energy bottom line.

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Luthin represents clients in regulatory proceedings and stakeholder processes at the state and federal level to ensure that their perspectives and needs are considered with the ultimate goal of reducing costs, creating and expanding opportunities, and enhancing value. Luthin’s regulatory intervention clients are generally large, not-for-profit institutional electric and gas consumers (or others who have similar interests.) These firms typically have multi-million-dollar energy budgets and dedicated energy staff but are not so large as to have the resources to directly intervene themselves.

By hiring the staff at Luthin, clients are able to access and deploy the experience, knowledge and relationships built up over more than twenty years at a small fraction of the times and cost necessary to develop them organically. When like-minded clients band together as a group, such as the Consumer Power Advocates, they gain both political and budgetary economies as well.

Many efforts are ongoing at any given time in which Luthin is involved on behalf of its clients. Some of the most recent include or have included:

Con Edison Electric, Gas and Steam Rate Cases, and National Grid Gas Rate Cases – Intervening on behalf of the Consumer Power Advocates, Luthin has been able to achieve over a $100 million in savings for its members over the last two decades by limiting or eliminating entirely rate increases proposed by the utilities. For example, in the most recent Con Edison rate case, Luthin successfully opposed rate design changes that would have had disastrous effects on larger customers.  As a result, Luthin’s clients received the lowest percentage increase in delivery rates for most of their use. Luthin also led the effort to mitigate increases in interruptible gas rates, negotiating a 35% savings relative to rates proposed by Con Edison.

Distributed Generation (DG) – Many of Luthin’s clients either own or are considering the installation of on-site generation facilities, usually combined heat and power (CHP) or cogeneration plants. Such installations can save money, improve energy efficiency and provide added security in the face of severe weather situations. Luthin has extensive experience conducting CHP feasibility studies and knows well that CHP may be more practical but is definitely not for everyone. We understand the nuances can help clients navigate the labyrinth of rules and requirements involved.

Standby Rate Proceedings – A big part of whether DG makes sense is whether or not standby service is the right rate or not for your installation. Standby service is the ability to take power from the grid when the DG or CHP system is down for maintenance. Luthin has negotiated more reasonable standby rates in the context of utility rate proceedings, as well as helped utilities develop innovative standby rate pilot programs. For example, in 2016, Luthin negotiated a new Reliability Credit, which will allow the customer a better opportunity to reduce Standby costs and in 2017 a new Standby Rate Pilot for Con Edison that will allow participants able to significantly reduce consumption during four-hour super-peak periods to drastically reduce their standby charges.

Reforming the Energy Vision Proceedings – The Commission’s landmark Reforming the Energy Vision (REV) initiative is an attempt to animate markets, increase customer choices, reduce prices and improve resilience as well as reliability. This is achieved by moving to a more decentralized bi-direction model where more customers produce power, both for their own use and for export to the grid. While the focus to date has been on customer-sited renewables, such a rooftop and community solar, additional reliance on clean combined heat and power as well as battery storage is expected as well. Luthin is one of just a few voices advocating for CHP opportunities.

Value of Distributed Energy Resources (VDER) Proceedings – The Commission is in the process of transitioning from so-called “net metering” under which customers that generate their own power receive a credit equal to their retail rate to a more sustainable value-based model under what is called the “value stack.” Comprised of energy, capacity, environmental and avoided distribution system cost components, distributed energy resources (DERs) would be paid for their injections onto the system based on where and when they deliver, as well as their emission characteristics. Luthin has submitted multiple comments and has actively participated in PSC collaboratives in order to ensure the voice of commercial customers is heard.

New York Independent System Operator (NYISO) Programs – NYISO is the federally regulated operator of the statewide power grid and wholesale energy markets. NYISO markets determine how much most customers pay for every kilowatt-hour (kWh) they use and the charges they are assessed for their peak demand. In addition, NYISO operates “demand response” programs that allow individual customers to earn significant revenues by agreeing to reduce load or activate local generation during system emergencies.

Representation at the NYISO is crucial to reducing the overall impact of administrative costs and ensuring that reliability and procedural measures are prudent and not overly burdensome to consumers.  Historically, Luthin has had a strong voice in shaping the mechanics of electric restructuring and this will continue in the coming year.

In the past, the NYISO Board of Directors followed many of the recommendations made by Luthin regarding the update of the ICAP Demand Curves. Most notably, the Board chose to base the new Demand Curves on the least-cost generation technology (some parties supported the use of more costly units), and it reduced the amount of excess capacity assumed for the future.