The Commission will convene rulemaking sessions to consider proposed natural gas and electric consumer protection and supplier-utility interaction rules. The rulemaking sessions will be held on March 10, 2009. The electric rulemaking is scheduled for 10AM, and the gas rulemaking is scheduled for 11AM. With respect to the retail natural gas market, the proposed rules pertain to pre-enrollment information, transfers of service, supplier-utlity coordination, utility consolidated billing, POR or prorated payments, and residential and non-residential consumer protections. With respect to the electric market, the proposed rules pertain to utility consolidated billing, utility responsibilities in the event of supplier default, and POR or prorated payments. The full text of the Proposed Rules can be viewed in the Maryland Register at: http://www.dsd.state.md.us/MDRegister/3526/main_register.htm

NYSEG and RGE filed electric and gas delivery rate cases seeking an increase in rates on an expedited basis. Commission Staff has filed a motion to dismiss the rate proceedings. Staff argues that the utilities have failed to meet the standard for rate review the Commission established in its Order approving Iberdrola's acquisition of the companies which limited the companies from filing a rate application prior to September 2009 unless their financial performance would fall to levels jeopardizing their ability to provide safe and reliable service. Staff maintains that its, "investigation and its testimony analyzing the filings show the NYSEG and RG&E are currently earning a 10.3% return on shareholder equity; which is even higher than what the Commission determined was reasonable in its Order Authorizing Acquisition. Those earnings, Iberdrola's continued liquidity, and the Companies' continued access to the public debt market, belie their position that their financial performance has fallen to levels that threaten service." The full text of Staff's Motion is available on the NEM Website.

NYSEG's Rate Case Filing is available at: http://www.nyseg.com/SuppliersAndPartners/pricingandtarrifs/ratefiling2009.html

RGE's Rate Case Filing is available at: http://www.rge.com/SuppliersAndPartners/pricingandtarrifs/ratefiling2009.html

The Commission adopted a policy statement on the processes and procedures to be utilized to review and approve proposed regulated reliability backstop projects. Underlying this process is the understanding that electricity resource reliability needs are normally expected to be met by the market, as they have been for the past years, and that it may be many years before any regulated reliability backstop project could be needed. The Policy Statement endorsed a process whereby Commission Staff would monitor NYISO's Comprehensive Reliability Process, and if, in the course of that review, it was determined that there was a reasonable likelihood that a reliability backstop solution would be needed, a more formal review of transmission owner and alternate regulated backstop proposals would take place. The Commission also addressed concerns related to the impacts of utility long-term contracts on competitive markets. The Commission stated, "the expressed concerns of a number of parties with regard to the potential impact of regulated reliability backstop projects on the competitive markets seem over-stated. First, there have never been any such projects in New York, and, if the markets continue to provide a reliable grid, there will not be a need for such projects in the future. Second, according to the NYISO's most recent estimates, there will be no need for any reliability project until after 2018. For us to determine today the specifics of a cost recovery mechanism for unidentified projects and undefined reliability needs that may be required after 2018 seems premature at best. We have previously addressed the issues of long-term contracts and impacts on competitive markets, as well as our preference to pursue competitive solutions wherever reasonably possible." The full text of the Policy Statement is available on the NEM Website.

In previous orders, the Commission determined that certain forms of beneficial distributed generation (DG), such as small combined heat and power (CHP), would be eligible to opt for an exemption from standby rates. Developers of eligible DG and CHP projects could select among standby rates, a phase-in to those rates, or standard tariff rates. The availability of these rate options is currently set to expire on May 31, 2009. The Commission is seeking comments on the need to continue the exemption from standby rates in order to promote the development of DG and CHP projects, how long the exemption or rate options should remain available, and how to balance developer and ratepayer interests as they pertain to an exemption. Requests to be added to the service list are due March 10, 2009; initial comments are due April 6, 2009; and reply comments are due April 20, 2009. The full text of the Order Instituting Proceeding is available on the NEM Website.