The Commission will hold a Retail Electric Competition Workshop next week, on July 30th at the Commission's Phoenix office. NEM will participate in the Workshop and present its recommendations.

Staff filed proposed revisions to the Commission's retail electric competition rules for discussion at the workshop. Notable among the proposals is to restrict customers eligible to shop to non-residential customers with monthly demand of 100 kW or more with the exception of allowing consumers to aggregate demand to meet a minimum aggregation threshold of 1MW. The proposed rules would also permit municipal aggregation for residential, business and municipal accounts. The proposed rules do not include a start date for competition. Under the proposed rules, utilities would be providers of Standard Offer Service and would be required to unbundle rates.

This week, in anticipation of the workshop, Commissioner Olson submitted a letter to the docket about Staff's proposed rule revisions. His letter said,

"I view the framework in Staff's initial proposal to be a very modest increase in energy choice for some commercial customers. This initial proposal essentially removes the heart of the competition rules which intended to eliminate monopoly service territories and establish a regulated playing field for energy competition open to all customers. It is my hope that, instead of simply considering this limited proposal which would benefit only a small number of commercial customers, we consider a return to the central purpose of the competitive rules to restructure our form of regulation entirely. In my view, it is time to address whether there is any justification for continuing the monopoly system in a time when technology allows for a healthy, robust and reliable market in energy for all customers.

In the docket and in our upcoming workshops, I would like parties to consider a regulated competition framework that includes the following basic tenets:
1) Incumbent utilities that ultimately operate only transmission and distribution;
2) Energy Service Providers (ESPs) licensed by the Commission who serve both residential and commercial customers;
3) ESPs that provide generation, billing, rate design, and customer service;
4) Commission sets and approves maximum and minimum rates by evaluating fair value of property, market conditions, and the long-run cost of providing service;
5) A transition to competition that allows utilities to offer a standard service for a period of time until all customers shop for their energy;
6) Incumbent utilities can serve as Provider of Last Resort for a period of time until the responsibility can be shared among all ESPs;
7) A transition from the Arizona ISA to forming or joining an RTO."

The full texts of Staff's Proposed Retail Electric Competition Rule Revisions, the Notice of Workshop and Commissioner Olson's Letter are available on the NEM Website.

Dominion filed an application for approval of a 100 percent renewable energy tariff, designated Rider TRG that would permit participating customers to voluntarily elect to purchase 100 percent of their energy and capacity needs sourced from renewable energy resources. Dominion's filing is of particular significance because if the Commission approves Rider TRG as meeting the statutory definition of a 100% renewable energy tariff under Virginia Code § 56-577 A 5, then it would impact the Company’s obligation to allow retail choice to customers seeking to purchase renewable energy.

"Rider TRG customers will receive 100 percent of their energy and capacity from a portfolio of resources owned or contracted for by the Company that meet the definition of renewable energy in Va. Code § 56-576 (the “TRG Portfolio”)." Dominion projects that the TRG Portfolio will be able to meet the capacity and energy requirements of approximately 50,000 residential customers or their commercial equivalent. Customers on Rider TRG will pay a premium over standard service that is based on the prevailing market value of retail renewable energy, using the market value of RECs as a proxy for this premium as well as an additional balancing charge. Eligible customers must have a peak demand of less than five megawatts in the most recent twelve-month billing period.

Dominion states that its 100 percent renewable energy tariff is structured to operate and function like the 100 percent renewable tariff that was approved for APCo.

The Commission has established a procedural schedule for the case as follows: September 17 - notice of participation due; October 17 - respondent testimony; October 31 - Staff testimony; November 12 - Dominion rebuttal testimony; November 14 - written comments; and November 21 - public hearing.

The full texts of Dominion's Application and the Procedural Order are available on the NEM Website.