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June 20, 2014
Upcoming NEM Events

NEM Summer Leadership Roundtable - NEM’s Summer Policy Leadership Roundtable will be held at the University Club in Chicago, IL on August 5-7, 2014. Chairman Doug Scott of the ICC has confirmed his participation and has invited the other Commissioners, key staff, and the Governor’s office to attend. Registration is now available on the NEM website at this hotlink. Please contact Catalina to secure a hotel room at the University Club.

NEM Mid-Atlantic Energy Summit - Please also plan to attend the NEM Mid-Atlantic Energy Summit to be held at The Center Club in Baltimore, MD on October 21-23, 2014. Registration is now available on the NEM website at this hotlink. Hotel Rooms are available at the NEM Rate of $160 at the Embassy Suites Inner Harbor Hotel in Baltimore, MD.

Please contact headquarters if you are interested in sponsoring either of these events.

FERC Opens Proceeding on Price Formation in Energy and Ancillary Services Markets Operated by RTOs/ISOs

FERC has opened a proceeding to evaluate issues regarding price formation in the energy and ancillary services markets operated by RTOS and ISOs. The Commission stated, "Ideally, the locational energy market prices in the energy and ancillary services markets would reflect the true marginal cost of production, taking into account all physical system constraints, and these prices would fully compensate all resources for the variable cost of providing service. The RTO/ISO would not need to commit any additional resources beyond those resources scheduled economically. Further, load would reduce consumption in response to price signals such that market prices would reflect the value of electricity consumption without the need to administratively curtail load. In reality, RTO/ISO energy and ancillary services market outcomes are impacted by a number of technical and operational considerations."

While recognizing these limitations, FERC believes there could be opportunities to improve the price formation process. FERC directed Staff to convene workshops on the following issues in this regard: 1) use of uplift payments; 2) offer price mitigation and offer price caps; 3) scarcity and shortage pricing; 4) operator actions that affect prices. The first workshop will be predominantly focused on the topic of uplift. The full text of the Notice of Proceeding is available on the NEM Website.

Click here to view all past updates.
Commission Announces New Policies on Grid Modernization and Time Varying Rates

In Orders issued in companion dockets, the Department announced a new vision for electric grid modernization accompanied by a policy framework for time varying rates. The Department decided that the electric utilities should file ten year grid modernization plans including how they will be: "1) reducing the effects of outages; 2) optimizing demand, which includes reducing system and customer costs; 3) integrating distributed resources; and 4) improving workforce and asset management." The utilities filings are to include a five-year short-term investment plan that includes an approach to achieving advanced metering functionality.

In the Policy Framework, the Department determined that basic utility service should include time varying rates for all rate classes after the deployment of advanced metering functionality. The utilities will provide two basic service options: 1) a default product with a TOU pricing structure that includes a critical peak pricing component; and 2) a flat rate with a peak time rebate option. Comments on the policy framework are due July 3, 2014.

The full texts of the Grid Modernzation Order and Time Varying Rates Policy Framework are available on the NEM Website.

Click here to view all past updates.
Tentative Order on Updates to Electric Utility Eligible Customer Lists

The Commission issued a Tentative Order requesting comment on proposed recommendations for a triennial solicitation schedule for the electric utilities to update their eligible customer lists (ECLs). "Specifically, the Commission requests comments on a three-year update schedule; the treatment of those customers receiving both electricity and natural gas service from the same utility; the content of the solicitations; and the amount and recovery of the costs associated with the solicitations." With respect to dual commodity utilities, the Commission requests comment on the most effective way to make the solicitation to dual commodity customers, and if a customer can restrict all/some of its information from appearing on the ECL for one commodity but not for purposes of the ECL for the other commodity.

The Commission proposes that the triennial solicitation include the following information:
"(1) what the ECL is; (2) what information is to be included on the ECL; (3) what the more detailed information represents; (4) how this information is to be used by NGSs; (5) how the information is to be safeguarded by NGDCs; (6) how widely the information will be disseminated; and (7) the potential benefits to the customers of having their information included on the ECL." The Commission proposes that customers be permitted to reply to the triennial solicitation via direct mail, website, electronic mail and/or telephone. Comments are due July 21st.

The full text of the Tentative Order is available on the NEM Website.

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