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February 26, 2005
NEM Annual Membership Meeting and National Energy Restructuring Conference.

NEM's Annual Spring Membership Meeting and National Restructuring Conference will be held at the Marriott Metro Center on April 26-27, 2005 in Washington, DC. Our annual VIP reception will be held at the Canadian Embassy. Many thanks to Centrica, Commerce Energy Group, ESG, Excelergy, Interstate Gas Supply, Constellation NewEnergy, Proliance and SAP for offering to sponsor this event.

Speakers this year include FERC Chairman Patrick Wood, Commissioners Brownell and Kelly, CA Deputy Secretary of Energy Joseph Desmond, NYPSC Chairman William Flynn, Orange and Rockland Ulilities President John McMahon, MADTE Chairman Paul Afonso and Chairman Alan Schriber from Ohio confirmed to speak. In addition to those mentioned above, Michigan PSC Chair Laura Chappelle, Ronald Cerniglia of the New York PSC, Jeanne Fox of the New Jersey Board of Public Utilities, and CA PUC President Michael R. Peevey have also confirmed.

Sessions will include: 1) Serving the Public Interest : Shifting Commodity Risks to the Marketplace, Modification of the Obligation to Serve and Incentives for Sustainable Growth; 2) Transition to a Competitive Market – Cutting Edge Accelerated Customer Migration Strategies, Incentives and Timing of Utilities’ Exit from the Merchant Function. To sign-up for this conference or view the agenda for the two day event, please click here.

FCC Requested to Preempt Telemarketing Law

A petition was filed with the FCC requesting it to preempt a Florida statue prohibiting telephone solicitors from making sales calls to Florida residents if the call involves an automated system for the selection or dialing of the numbers or the playing of a recorded message. The petition by TSA Stores argues that the FCC regulations pre-empt the Florida law for interstate calls that use pre-recorded messages to persons with a established business relationship with the caller. TSA requests that the FCC issue a declaration pre-empting the Florida law.

Comments will be due in March 2005. Please send your comments to headquarters ASAP.

House Subcommittee Prepares Energy Policy Act of 2005

Congressmen Ralph Hall(R-TX), Chairman of The House Subcommittee on Energy and Air Quality, convened a second hearing on February 16 and released a draft of this year's energy legislation. Generally, the bill contains significant incentives for reliability and investments in infrastructure upgrades. Energy Policy Act of 2005. is hot-linked here for your review.

Please call headquarters with your comments.

Click here to view all past updates.
California Is Looking to Address Demand Responses and Critical Peak Days

The Commission has opened a proceeding to review the utilities' applications to implement various default rate design proposals for large customers (over 200 kW). The Commission wanted a design that provides a critical peak price signal. The rates are expected to be implemented by June 2005. A prehearing conference was held February 24.

The Commission also issued a decision approving the 2005 Demand Response Goals, Programs and Budgets. The order was issued in response to the requests by the utilities for approval of their demand response programs and budgets for 2005-2008. The order specifically addresses summer 2005 day-ahead notification demand response programs and reliability-triggered programs.

PG&E recently filed a report on the cost effectiveness of its demand response programs and demand side management activities.

Click here to view all past updates.
Utilities and Some Marketers Reach Interim Settlement on Phase II Shifted Gas Costs

Connecticut Natural Gas, Yankee and Southern Connecticut Gas, along with the Consumer Counsel and 2 marketers, filed a proposed Year 4 Interim Settlement Agreement. Year 4 begins on November 1, 2005. The agreement provides for approximately 90% recovery of shifted costs and a temporary transition charge of 43 cents/Mcf for firm transportation customers (an increase from the current 34 cent/Mcf). An open season will be held by August 15 for Riders BAL and STB service, with Yankee also releasing long-haul capacity for 12 months via an open season. Suppliers also will purchase long-haul service from each utility via an open season.

The parties are still negotiating a long-term solution for shifted costs.

Click here to view all past updates.
Georgia Electric Market May Become More Open to Wholesale Alternative/Renewable Supply

Although NEM has not yet reviewed the order, it is reported that the Commission has ordered Georgia Power to revise its formula for paying alternative/renewable power suppliers. Specifically, Georgia Power should be able to obtain alternative/renewable energy supply on a year-round basis, instead of only during peak summer demand times.

Click here to view all past updates.
Default Service to be called Basic Service.

On and after March 1, utilities are required to refer to default supply service as “basic service”.

New York
Click here to view all past updates.
ConEd Proposes New Unbundled Rates

In ConEd's unbundling proceeding, ConEd filed reply comments that included new unbundled rates and tariff sheets. Comments on the new unbundled rate tariff sheets are due by March 4. Comments only are allowed on the new language proposed by ConEd.

National Fuel Extends Suspension Period.

In National Fuel's ongoing case regarding a proposed increase in rates and charges, National Fuel has again extended the suspension of prices. The prices will now take effect on August 31, 2005.

In its continuing settlement talks with the Commission and Staff, a chance of settlement has caused the hearing in the case to be delayed until March 21, 2005.

Click here to view all past updates.
Ohio Approves Phase 2 of AEP’s Restructuring.

In the AEP rate stabilization case, the Commission issued an order on, among other things, AEP’s generation and distribution rates, default service, and rates for customers returning to default service for 2006 through 2008. AEP’s market design phase ends on December 31, 2005. Ohio Power will not charge the regulatory asset charge rider to the first 20% of residential customers that switch to suppliers; however, Columbus Southern’s shopping incentive ends on December 31, 2005. AEP’s fixed generation rates were increased and AEP will be the default service provider for 2006-2008.

Unfortunately, AEP is not required to do a competitive bid for 2006-2008; the minimum stay requirement for returning customers is long (up to one year); and shopping customers will not get a credit for PJM costs.

Requests for rehearing were due Friday, February 25. NEM was an active participant in this case and is considering whether to file a rehearing request.

East Ohio Proposes Same Disconnection Rules for All Customers.

In response to East Ohio’s proposal to waive the rules prohibiting the disconnection of customers for non-payment of supply charges, various suppliers have filed in support of East Ohio’s request. The proposal would treat customers of suppliers and customers of East Ohio the same regarding disconnection procedures. A similar waiver was granted to Columbia.

Consumers’ Counsel is Challenging FirstEnergy’s Default Rates.

The Consumers’ Counsel has filed for rehearing of the Commission’s January order regarding FirstEnergy’s default rate for returning residential customers. Specifically, the Consumers’ Counsel challenged the standard offer rate plus 5% plus a surcharge.

CG&E Files to Remove Residential Minimum Stay Tariff Provisions

CG&E filed proposed tariff sheets removing the minimum stay provisions. CG&E states that the residential minimum stay provisions are not effective until the Commission issues an order in the CG&E mminimum stay proceeding (which began in 2001).

Shopping Customers Have Three Options to Give CG&E Notice of Intent to Receive Competitive Supply.

Non-residential customers who want to buy generation service from a supplier may either submit to CG&E: (1) a one-page form of notice as proposed by Constellation; (2) the agreement proposed by CG&E, as modified by the Commission, or (3) a copy of the supplier contract. A copy of the Commission's order approving these 3 forms of notice is available on NEM's website.

Click here to view all past updates.
Pennsylvania Issues Report on the Status of Competition.

The Commission issued its quarterly report on the status of competition in the energy markets. The report includes aggregated basic market data, customer shopping and load levels compared to other states, and a summary of important Commission decisions.

Pennsylvania Staff Finalizes Demand Side Response Recommendations

After receiving comments from the Demand Side Response Working Group, Commission Staff is developing a recommended policy statement on demand side responses issues. The Commission is expected to request comments before adopting a final policy statement. The proposed recommendations are expected to require utilities to have demand side response pilots implemented by June 1, 2006, with demand side response programs available to all customers by 2010.

Settlement Negotiations Expected Regarding Columbia Gas' Fixed Price Services Proposal

With the case expected to be scheduled for hearing shortly, the Columbia Gas fixed price services proceeding has entered into settlement negotiations. The proposed services will not go into effect until August 2005.

Members should inform NEM headquarters of their company's position and let them know if you would like to participate in the settlement conference calls. NEM can also circulate to its members a copy of Columbia's confidential settlement proposal.

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