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February 17, 2012
NEM's 15th Annual National Restructuring Conference

Since this is the beginning of NEM’s 15th Year, we have made special plans to celebrate this milestone at our 15th Annual National Restructuring Conference in Washington, DC on April 24 and 25, 2012. The Conference will be held at the Embassy Suites DC Convention Center, 900 10th Street, NW, Washington, DC. The Agenda is available at this hotlink.

Public Service Commission Chairs, Commissioners and other elected and appointed officials from around the country have already started to confirm their participation. Your sponsorship and support would be very helpful to make this NEM Event the best ever.

Sponsorship opportunities for this event can be viewed online at this hotlink.

Early registration for the April event is available online at this hotlink.

NEM Comments to CFTC on Retail Commodity Transactions Under Dodd Frank

NEM filed comments on the Commission's proposed interpretation of the term “actual delivery” under Section 742(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act. This Section of the Act gave CFTC jurisdiction over certain “retail commodity transactions,” subject to certain exceptions. NEM requested that the Commission clarify that the types of transactions which its retail energy marketer members typically enter into with residential and commercial customers, in which they contract with the consumer to provide physical energy supply (electricity or natural gas) for terms that regularly in the course of business contemplate delivery of the physical energy commodity in excess of 28 days, were not intended and should not be interpreted to constitute “retail commodity transactions” under the Act. NEM additionally requested that longer term fixed price contracts and the commercial hedging transactions necessary to fulfill their obligations to physically deliver natural gas and electricity that are clearly intended by the consumer for end use consumption in either their home or place of business qualify for the line of business, typical commercial transaction, commercial hedging and end use exceptions as codified by Dodd-Frank and interpreted in this and related rulemakings. The full text of NEM's Comments is available on the NEM Website.

FCC Adopts Restrictions on Automated Telemarketing Calls

Pursuant to its authority under the Telephone Consumer Protection Act (TCPA), the FCC issued an order adopting restrictions on telemarketing "robocalls." FCC said the action is justified by levels of consumer frustration with the robocalls as well as its statutory charge to maximize consistency with FTC telemarketing rules. "First, we require prior express written consent for telemarketing robocalls to wireless numbers and residential lines. Second, we eliminate the “established business relationship” exemption as it previously applied to telemarketing robocalls to residential lines. Third, we require telemarketers to implement an automated, interactive opt-out mechanism for telemarketing robocalls, which would allow a consumer to opt out of receiving additional calls immediately during a robocall. Fourth, we require that the permissible three percent call abandonment rate be calculated for each calling campaign, so that telemarketers cannot shift more abandoned calls to certain campaigns, as is possible if calculation is made across multiple calling campaigns. Finally, we adopt an exemption to our TCPA rules for prerecorded health care-related calls to residential lines, which are already regulated by the federal Health Insurance Portability and Accountability Act." Prerecorded messages that are nontelemarketing, informational calls are subject to different requirements. The full text of the Order is available on the NEM Website.

Moeller Questions on Natural Gas-Electric Interdependence

Commissioner Moeller issued a series of questions related to the increasing interdependence of natural gas and electricity. Moeller points to the impacts on outages and reliability caused by the interdependence. Moeller raised the following specific questions for comment:

"Specifically, what role should the Federal Energy Regulatory Commission have in overseeing better coordination? What duties, if any, should be delegated to the North American Electric Reliability Corporation (NERC), the North American Energy Standards Board (NAESB), or other entities?

To what extent should FERC defer to various regions of the country in addressing these challenges? Should FERC view organized electricity markets differently from bilateral electricity markets? If regional deference is given, what role should FERC play to assure that regional agreements are adhered to?

The expanded use of natural gas for electricity generation is likely to change flows on the natural gas pipeline system. Does FERC need to address this issue?

Within each day, electricity trading differs significantly from gas trading. Similarly, on a day-to-day basis, the various gas markets may not be open on the same days as the corresponding electricity market, especially over Saturdays, Sundays, and Holidays. How should FERC help to harmonize these markets?

What will be the impact of the expected retirements of coal and oil-fired generation on the need for gas and electricity coordination?

To what extent should FERC consider modifying its existing Standards of Conduct with regulated utilities—either on an emergency basis or in a more fundamental manner—to assure greater coordination of these industries?

Will progress on this issue be faster if policies are addressed in several “baskets”, such as communication, operation, contracting, and planning/contingency analysis? If so, what are the appropriate “baskets”?"

Comments on the questions are due March 30, 2012. The full texts of Commissioner Moeller's Questions and Notice Requesting Comments are available on the NEM Website.

Click here to view all past updates.
NEM Filing on Columbia Choice Program

NEM filed in support of the City of Hagerstown's petition for reconsideration and rehearing of the Commission's decision to end Columbia's gas choice program. Hagerstown's petition argued it had received no notice of the possibility of the end of Columbia's choice program and that it would suffer a number of negative associated impacts. NEM argued that reconsideration/rehearing was appropriate because: 1) the potential elimination of Columbia’s choice program is a new rule which should have been promulgated pursuant to the State Administrative Procedures Act requirement for due process; 2) the Commission’s Order did not consider the other options presented on the record aside from the elimination of the choice program; 3) the decision to end the Columbia choice program was made before the COMAR 20.59 program changes were made and results evaluated; 4) the Order does not consider the impacts on current choice customers of eliminating the choice program; 5) POR program implementation is a new issue before the Commission related to its longstanding policy in support of energy choice. The full text of NEM's Comments is available on the NEM Website.

Columbia Files Transition Plan to Move Choice Customers Back to Full Service

As required by the Commission, this week Columbia filed a transition plan to move choice customers back to full utility service. Columbia proposes that this take place by the April 2012 billing cycle. Columbia argues this timing is appropriate to minimize costs, provide customers with sufficient notice, and enable it to revise the quarterly Purchased Gas Adjustment calculation so that it no longer reflects the assignment of pipeline and storage costs to suppliers. Columbia sent a letter to residential choice customers on January 30, 2012, notifying them of the elimination of the choice program. Columbia also noted its, "intent to assist the suppliers in transitioning the commercial customers from Choice to the Gas Transportation Service program that is available to all commercial and industrial customers on Columbia’s system." The full text of Columbia's Transition Plan is available on the NEM Website.

Hearing on HB781 Scheduled

A hearing is scheduled on HB781 next week. HB781 amends the statutory of definition of natural gas and electricity "broker." It would also create an Electricity and Gas Supplier Relations staff position at the Commission.

HB781 sets forth a number of proposed requirements regarding residential electricity supply contracts as follows:

(F)(1) In this subsection, "residential supply contract" means an agreement between an electricity supplier and a residential customer to provide electricity or electricity supply services.
(2) If an electricity supplier claims on any of its marketing materials or its web site that a residential supply contract may or will result in savings based on historical performance, the electricity supplier shall include on the marketing materials and the web site a clear disclaimer that states that historical savings do not guarantee future savings.
(3) If the terms of a residential supply contract provide that a rate is subject to change or is a variable rate, the electricity supplier shall notify the customer the amount of a new rate electronically or in writing at least 30 days before a new rate takes effect.
(4)(I) A residential supply contract may not contain an automatic renewal provision unless the customer is given:
1. Clear and conspicuous notice of the terms of the automatic renewal provision; and
2. The opportunity to accept or reject the automatic renewal provision before the residential supply contract is executed.
(II) A customer shall indicate acceptance or rejection of the terms of an automatic renewal provision by writing the customer's initials next to the provision in the residential supply contract or via a separate electronic check box accessed on the internet.
(III) A customer may refuse to renew a residential supply contract at any time up to 30 days before the day when the automatic renewal is scheduled to take effect.
(IV) An electricity supplier shall provide to a customer a standard customer service electronic mail address that the customer may use to contact the electricity supplier to initiate a request, including canceling or refusing the renewal of a residential supply contract.
(5)(I) 1. A residential supply contract may not contain an early termination fee or a penalty on cancellation of the residential supply contract unless the customer is given clear and conspicuous notice of the terms of the early termination fee or penalty before the residential supply contract is executed.
2. A customer shall acknowledge notice of an early termination fee or a penalty on cancellation of a residential supply contract by writing the customer's initials next to the notice in the residential supply contract or via a separate electronic check box accessed on the internet.
(II) If a residential supply ontract requires the customer to pay an early termination fee of a penalty on cancellation of a residential supply contract, the early termination fee or penalty shall decrease by an equal amount each month so that the customer owes no early termination fee or penalty at the end of the residential supply contract."

The hearing on HB781 will take place next Thursday, February 23, 2012, at 1PM. The full text of HB781 is available on the NEM Website.

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