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April 6, 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 confirmed 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.

Click here to view all past updates.
ComEd 2011 POR Report

ComEd filed its 2011 Annual Report on POR with Consolidated Billing (CB). ComEd reports that during that period there were 21 suppliers taking service under its Rider PORCB. The total amount of discounted receivables purchased under Rider PORCB were in excess of 61 million dollars. ComEd reports that starting in April 2011 it, "applied a CB adjustment of 4 cents per bill to residential and commercial customers with demands under 400kW," that recovered $1,445,608 in 2011. ComEd reports that the, "current CB adjustment is adequately recovering the carrying costs." However, ComEd reports that, "the applicable $0.50 per bill charged to the RESs did not produce enough revenue to cover the annualized costs associated with the POR portion of the program. In particular, the revenues received were $456,067 while the 2011 annualized costs of the program were $568,858. Although the revenue received was for a nine-month period, the annualized amount is not sufficient to recover both the POR annualized costs and the Consolidated Billing annualized costs. Therefore, both the CB Adjustment and $0.50 per bill charges will be continued." The full text of ComEd's POR Report is available on the NEM Website.

Click here to view all past updates.
BGE Discount Rate Calculation Proposals

BGE made its annual filing to update its electric and gas discount rates. Five of the six discount rates are negative under BGE’s calculation, so consistent with prior practice, it proposes to set those negative discount rates to zero.

Electric Discount Rates as calculated
Residential - -0.4063%
POLR Type I - -1.0379%
POLR Type II - 0.2669%
Hourly Service - -0.2512%

Gas Discount Rates as calculated
Residential - -1.0367%
General Service - -0.1134%

However, going forward BGE makes proposals to revise the discount rate calculation to avoid this result, which it argues is caused by the inclusion of late payment charges (LPCs).

“BGE presents three alternatives for the Commission’s consideration to address the negative discount rates. First, BGE submits the calculation as computed with late payment revenues, in accordance with its tariff. It is this computation that created negative discount rates. Consistent with the remedy directed by the Commission last year, BGE re-sets the negative rates to zero. Second, BGE offers an alternative that removes LPCs from the discount rate, prospectively, for the July 2012 - July 2013 period. Finally, because BGE argues that LPCs compensate a utility for credit and collections costs, BGE submits a calculation whereby the LPCs remain in the computation, but adds a credit and collections component to compensate BGE for those costs, since LPCs benefit the suppliers through a reduction to the discount rate. BGE recommends that the Commission adopt its second proposal whereby LPCs are removed from the discount rate calculation prospectively, as suppliers never get paid late under the POR methodology, and the inclusion of LPC charges in the discount rate causes BGE’s distribution rates to be inappropriately increased.

. . . .

Even if it is assumed that suppliers are passing back to customers through lower commodity rates all LPCs received from BGE via the discount rate, a subsidization between shopping and non-shopping customers is still occurring. While shopping customers are receiving a lower commodity rate from suppliers without the burden from the associated credit and collections costs, non-shopping customers are bearing the full credit and collections costs burden without any of the benefit provided by LPC revenues. This is by no means an equitable outcome for customers who have not selected an alternative energy provider.

BGE requests that the Commission accept a cost recovery framework that excludes LPCs, effective with the July 1, 2012 re-set of the discount rates. If not, BGE recommends that the Commission convene the Electric Supplier Coordination Tariff working group to re-consider the inclusion of LPCs in the discount rate or consider other options that will minimize the possibility that negative discount rates will occur in the future, and incorporate those changes, where applicable, into the Gas Supplier Tariff.”

BGE proposed that the Commission take up the filing at its May 2nd Administrative Session. The full text of BGE's Filing is available on the NEM Website.

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