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December 17, 2010
NEM Winter Executive Committee Meeting

NEM's Winter Executive Committee will take place January 17-19, 2011, at the Doral Hotel and Resort in Miami, Florida. An agenda will be forthcoming. Many thanks to Doug Marcille and U.S. Gas and Electric for hosting the Winter Meeting. Hotel reservations should be made at this hotlink.

You may register for the Winter Executive Committee Meeting at:

Viridian Energy Elected to the Executive Committee

NEM is pleased to announce that Michael J. Fallquist, founder and CEO of Viridian Energy, has been elected to the Executive Committee.

Viridian Energy is a fast growing, environmentally focused retail energy provider serving customers in Connecticut, Maryland, New Jersey and Pennsylvania. Since commencing operations in July 2009, Viridian has expanded rapidly and is currently serving approximately 125,000 customers. Viridian plans to expand operations into in New York, Massachusetts and Illinois over the next several months.

"Our vision at Viridian is very simple. We provide an unmatched value proposition to our customers combining higher quality green energy with a strong savings proposition to the utility," said Michael J. Fallquist, CEO. "We are pleased to be associated with NEM as we continue to expand our company by offering the power of choice in energy providers."

Viridian is committed to offering greener energy by offering electricity products with a minimum of 20% renewable content. This goal exceeds the existing RPS guidelines in each state Viridian operates. Viridian's Everyday Green plan is 20% renewable, while the company's Green-e Energy certified Pure Green plan offers customers 100% wind energy.

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Order on ComEd POR Program

The Commission issued an Order approving a POR program for ComEd. The program will include an all-in requirement for marketers serving residential customers under POR and will permit ComEd to terminate for nonpayment of marketer charges. The Commission declined to require the utility to provide bill insert service to marketers.

The Commission approved a $.50 per bill charge for POR. The Commission concluded that, "POR and UCB should be provided at rates that promote their widespread use consistent with the intent of the General Assembly that all Illinois consumers receive the benefits of a competitive retail electricity market. Accordingly, we adopt the fixed charge approach, which properly accounts for the fixed nature of the start-up and implementation costs being recovered by that charge. . . . In this way, all RESs are treated fairly and RESs serving high-use customers are not forced to subsidize RESs serving low-use customers. Record evidence supports a finding that adopting a percentage charge would impose higher charges on RESs for high-use customers despite the fact that the start-up and implementation costs are fixed and that these customers impose no higher costs on ComEd than low-use customers’ bills."

The Commission concluded the Order on a cautionary note. "The Commission recognizes that, consistent with Section 16-118 of the Public Utilities Act, it is the policy of the State of Illinois to encourage retail competition. One means to accomplish this goal is through the Utility Consolidated Billing and Purchase of Receivables mechanisms (POR/UCB). While the Commission is optimistic that many of the decisions made in this Order help meet this objective, there will be a continuing need for close monitoring of the POR/UCB process going forward to ensure that the Act’s intended outcomes are realized. As such, the Commission requests ongoing, detailed feedback from all interested parties.

To this end, the Commission strongly encourages its Office of Retail Market Development (“ORMD”) to provide periodic updates to Commissioners concerning the development of the retail market for residential and small commercial customers in Illinois. In particular, the degree to which the Purchase of Receivables and Utility Consolidated Billing mechanisms fostered growth in that market and, any ideas ORMD or other stakeholders can share on how to make those mechanisms more effective. In addition, the Commission strongly encourages certified alternative retail electric suppliers, ComEd, and all stakeholders to work closely with the ORMD and requests that periodic updates be provided to ORMD on the effectiveness of and utilization rates associated with the Purchase of Receivables and Utility Consolidated Billing services. If, after 9 months from the date of this Order, the ORMD finds that the rate of adoption of UCB and POR by certified alternative retail electric suppliers is not occurring at an adequate pace, the Commission encourages ORMD to determine whether, and to what degree, retail competition is occurring for residential and small commercial customers. Moreover, if in the opinion of ORMD, residential and small commercial customer switching rates are not developing at an adequate pace, the Commission recommends ORMD hold workshops to determine why that is the case. The workshop process will serve to establish reasonable goals and timelines to enhance residential and small commercial switching rates. Further, the Commission requests the parties to provide the ORMD with any reasons they believe have resulted in customer switching lag, whether it be POR/UCB design, wholesale market barriers, differences between RTO business models, or any other structural or market barriers that become apparent to market participants - all constructive comments are encouraged. At the conclusion of these workshops, we direct that any recommendations for proposed modifications to ComEd’s POR and UCB services be provided to the Commission."

The Commission ordered ComEd to institute its POR program by no later than December 31, 2010. The full text of the Order is available on the NEM Website.

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Comments on Agent Licensing

Numerous parties filed comments in the Commission inquiry into agent licensing. In its comments, OPC recommended that, "under certain circumstances, individuals selling gas and electric supply to residential customers for compensation under a multi-level marketing approach should be required to obtain some form of licensing. The basis for the licensing requirement can be found in existing law under PUA 7-507 and PUA 7-603. For the category of marketers that are engaging in affinity marketing for an organization of which they are a member and for which they do not receive any direct compensation, OPC does not at this time recommend that licensing be required. Sales representatives who are either employees of or operating under contract to a licensee and who perform marketing services for a supplier or broker, either by telephone or door-to-door, should not be required to obtain a license from the Commission. Under agency law, actions taken by these entities are the legal responsibility of the original licensee. However, the Commission should consider further proceedings to determine whether sales representatives either working for or under contract to existing licensees should be subject to a registration requirement. Finally, the Commission should consider a rulemaking or other proceeding to adopt “Codes of Conduct” for marketing practices." The full text of OPC's Comments is available on the NEM Website.

The AG's office filed comments recommending that, "if the Commission permits multi-level marketing schemes, the individuals selling gas and electric supplies through such schemes should be regulated through licensing by the Commission. As these individuals are independent contractors rather than employees of the company, the Division believes the Commission should require them to be licensed individually." The full text of the AG's Comments is available on the NEM Website.

New York
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Commission Adopts ESCO Consumer Bill of Rights and UBP Changes

The Commission adopted Uniform Business Practice changes and an ESCO Consumer Bill of Rights to implement the marketing standards law adopted this year. The UBP changes:

"• Require ESCOs to provide each prospective customer a copy of the ESCO Consumers Bill of Rights developed by the Public Service Commission.
• Prohibit ESCOs from requiring a prepayment for energy services.
• Limit the amount of early termination fees.
• Prohibit an ESCO from making certain changes to a customer agreement without express consent."

The Commission clarified what constitutes a "prospective customer" to whom the ESCO Consumer Bill of Rights must be provided. "[T]he prospective customers to whom ESCOs must provide a copy of the ECBR include any potential residential customer to whom an ESCO markets, or any customer marketed to through “door-to-door sales.” Specifically, 1) for telephonic sales to residential customers the marketer must inform the customer where, on the ESCOs website, the ECBR is located and it must be provided with the first correspondence an ESCO sends the customer to be reviewed by the customer prior to the 3-day rescission period; 2) for door-to-door sales or other in-person sales presentations, the ECBR should be provided before an marketer makes its sales presentation; and 3) for internet sales, the ECBR should be provided as a non-avoidable screen which a residential customer must affirmatively click to verify they have seen the document, prior to effecting an enrollment. Additionally, the ECBR will be prominently displayed on this Commission’s website."

The ESCO Customer Bill of Rights required to be disseminated reads as follows:

"Customers can purchase energy supply from an Energy Services Company (ESCO) or from a traditional utility. If you choose to purchase energy supply from an ESCO you are entitled to:
• A clear description of the services offered by the
• Receive energy delivery and 24 hour emergency services from your utility company.
• Clear procedures for switching energy suppliers, including information about the enrollment process.
• Disclosure, in simple and clear language, of the terms and conditions of the agreement between you and the ESCO including:

o price and all variable charges or fees;
o length of the agreement;
o terms for renewal of the agreement,
o cancellation process and any early termination fees, which are limited by law; and
o conditions, if any, under which the ESCO guarantees cost savings.

• Rescind an agreement with an ESCO within three days of receiving the agreement, if you are a residential customer.
• A description of how pre-payment agreements works, if offered.
• Notice from the ESCO, no less than thirty days prior to the contract renewal date, of the renewal terms and the options you have as a customer.
• A fair and timely complaint resolution process.
• Provision of any written documents (contracts, marketing materials, and this ESCO Consumer Bill of Rights, in the same language used to enroll you as a customer.

If you are a residential customer you are also entitled to the rights and protections of the Home Energy Fair Practices Act (HEFPA) which requires that all utility customers be treated fairly with regard to application for service, customer billing, and complaint procedures. For more information go to

ESCOs that do not assure these consumer rights could lose their eligibility to provide service in New York. Please report any complaints to the Department of Public Service at 1-800-342-3377 (8:30 am – 4:00 pm), by mail at Office of Consumer Services, NYS Department of Public Service, 3 Empire State Plaza, Albany, NY 12223, or online at"

The Commission has requested additional comment on the treatment of a fixed rate contract that renews as a fixed rate contract with a new rate in the context of whether consumer's express consent to renewal should be required. The UBP modifications adopted by the Commission are applicable on a prospective basis to new service agreements and renewals of existing agreements effective on January 11, 2011. The full text of the Order is available on the NEM Website.

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