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October 12, 2012
NEM Fall Leadership Roundtable

NEM’s Fall Leadership Roundtable will be held October 15-17, 2012, at the Kellogg Hotel and Conference Center in Lansing, Michigan. NEM will host the Michigan Public Service Commission and its Staff. The Governor has been invited along with State Legislators and Auto Industry Officials. You may register at this hotlink. The current version of the agenda is available at this hotlink.

The Kellogg Hotel is completely booked. However, we were able to secure a block of rooms at the Hampton Inn at the rate of $99 per night. For reservations, please contact Angela McComb, Sales Manager, Hampton Inn East Lansing at 517-324-2072 or

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NEM Comments on WGL POR Discount Rate

NEM filed comments on WGL’s proposed updated discount rates applicable to its POR program. The proposed discount rates are 6.97% for residential receivables and 0.17% for non-residential receivables. The rates are proposed to go into effect for the next billing cycle following approval by the Commission. WGL’s current discount rates are 4.39% and 0.83% for residential and non-residential receivables, respectively. NEM noted its concern that by increasing the discount rate this significantly at the early stages of the POR program, it is likely that many suppliers may find it uneconomic to serve or continue serving consumers in the WGL service territory after having made significant investments of resources to offer energy options to customers at WGL. Moreover, at a 7% discount rate, the primary benefits of instituting a POR program - cost-effective optimization of existing ratepayer-funded billing infrastructure and avoidance of costs associated with supplier duplication of these investments at the early stages of market opening – are nearly or completely vitiated. NEM requested that modifications to WGL’s proposed calculation of the discount rate be made to: 1) extend the amortization period for the Information Technology cost component of the discount rate from the current two years to at least three years; and 2) include the late payment charges collected by WGL in its calculation of the discount rate. The full text of NEM's Comments is available on the NEM Website.

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Columbia Gas Settlement on Standard Choice Offer

Columbia Gas, Staff and other stakeholders filed a settlement with the Commission and are requesting a modification to a previous settlement that implemented the change from Columbia's gas cost recovery mechanism to an auction process for procuring gas supplies and establishing a retail price adjustment. The parties argue a modification is needed in view of the impacts on interstate capacity caused by Marcellus Shale gas. The initial settlement also did not include provision for Columbia's eventual exit of the merchant function, which the newly filed settlement contemplates upon the achievement of certain migration levels. The settlement also includes Columbia's implementation of billing improvements for suppliers. The full texts of the Motion and Settlement are available on the NEM Website.

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PECO Filing on Gas Price to Compare

PECO made a filing at the Commission to implement the Commission's regulations on the formulation of the Price to Compare (PTC). The PTC is to be comprised of natural gas supply charges, a gas procurement charge and a merchant function charge to recover uncollectibles. PECO has proposed unbundling commodity-related costs from delivery rates to derive a GPC of $0.0451 per Mcf. PECO proposes to implement the MFC by April 14, 2015. With respect to POR, PECO notes that it currently utilizes a one percent discount rate. PECO proposes to implement a POR discount rate to reflect the actual uncollectible rate and incremental costs associated with program development, implementation and administration of modifications by April 14, 2015. The full text of the PECO Filing is available on the NEM Website.

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