MichCon filed testimony in support of its application to sell excess storage gas as part of its overall planned storage facility enhancements. MichCon argues that of the 17 Bcf decrement of storage gas at issue, that 4 Bcf is Native Base Gas that is treated for accounting purposes as Utility Plant inasmuch as these "volumes of Base Gas that were present at the time of development of the gas storage field and are considered the primary volumes of base gas inventory required to meet storage field operations." MichCon is requesting to sell this 4 Bcf of Native Base Gas to non-system supply customers at market prices. MichCon proposes to keep the financial benefit of these sales. With the respect to the remaining 13 Bcf, MichCon characterizes it as working gas inventory that is "considered a source of system supply for sales customers and thus, pursuant to MPSC regulations, all gas costs associated with working gas storage withdrawals are included as part of the Gas Cost Recovery (GCR) mechanism." MichCon estimates that, "the net impact to GCR customers for the 13 Bcf decrement will be an estimated gas cost reduction of $28.1 million" for the period of 2006 and 2007. Moreover, it argues that the improved storage facilities will benefit "all of MichCon's retail customers" to the extent it can "incrementally improve its financial health by developing new revenue streams from sources other than retail customers." The full text of MichCon's Testimony is available on the NEM Website.

An Energy Master Plan (EMP) is being developed for the State by a committee of commissioners and leaders from nine state agencies and the Governor’s Office of Economic Growth. Goals and objectives identified in a draft of the plan include: secure, safe and reasonably priced energy supplies and services; economic growth and development; and environmental protection. Of particular note, specific goals include containing electricity prices per unit in New Jersey to no more than + 5% of the regional average and to eliminate transmission congestion by 2020 to equalize wholesale LMPs. Natural gas prices per unit are recommended to remain below the national average price by at least 15%.

The committee scheduled a series of public meetings next week to receive input. The meetings will take place as follows: October 23rd (9:30AM-12:30) at the Board's offices in Newark; October 24th (6-9PM) War Memorial in Trenton; October 25th (2-5PM) Delaware River Port Authority in Camden; and October 26th (6-9PM) Atlantic Cape Community College in Atlantic City.

The committee plans to hold additional statewide public meetings on January 22-25, 2007, public hearings on the Energy Master Plan on July 23-31, 2007, and to adopt the EMP by October 2007. The full texts of the Energy Master Plan Draft Documents are available on the NEM Website.

The Commission issued a policy statement finding that the deployment of Broadband over Power Line (BPL) is in the public interest. The Commission issued a series of principles to guide BPL deployments: "1) The deployment of economically viable BPL technology by electric companies solely to support electric system operations does not raise subsidization or cost allocation issues and is, therefore, permitted; 2) The deployment of BPL technology to provide communications services to the public implemented through a landlord model in which an independent party provides BPL services using utility assets is preferred; 3) The deployment of BPL technology to provide communications services to the public may not be implemented by regulated electric utilities but may be implemented through a structurally separated utility affiliate (or similar approach with at least the same degree of separation) subject to acceptable cost allocation, affiliate transaction and related business rules designed to prevent customer and utility subsidization and support of the competitive BPL service provider. Any such arrangements should be presented to us with a showing that customers and competition are not harmed; 4) Circumstances may arise when work related to the BPL system must be performed by utility employees or utility approved contractors. Utilities should have procedures in place to assure that no direct or indirect costs associated with this work, other than costs associated with support of electric operations, shall be collected from ratepayers or charged to utility operations; 5) Utilities remain responsible for ensuring safe and adequate electric service. The BPL provider is primarily responsible for responding to all customer service and collateral service complaints and issues, including any related to interference produced by BPL equipment; 6) The BPL provider and the utility should develop procedures for sharing and protecting customer and system information; 7) Pole attachment tariffs will continue to apply to attachments to utility poles by BPL providers; and 8) BPL providers should pay a fee for the ability to access the electric utility system. Such a fee could be based on a sharing of revenues or profits. This fee should eventually be based on prevailing market conditions if BPL becomes economically viable and is deployed on wide scale basis." The full text of the BPL Policy Statement is available on the NEM Website.

The Commission recently directed the Demand Response Working Group to reconvene to investigate energy efficiency, conservation, demand response, advanced metering infrastructure and ratemaking mechanisms. An organizational meeting of the entire Working Group will be convened November 16, 2006, at 10AM in Hearing Room 1. A subgroup will be formed to focus on Ratemaking Mechanisms, which will initially meet at 1PM in Executive Chambers. Additional details will be forthcoming. In order to be included in the Commission's distribution list for this proceeding contact Lori Shumberger in the Office of Communications at lshumberge@state.pa.us or (717) 783-9998.