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August 18, 2006
Upcoming NEM Meetings

Please note the following upcoming NEM meetings:

Fall 2006 Industry Leadership Roundtable - Delaware - Washington Gas Energy Services has generously offered to host the meeting
Winter 2007 Executive Committee Meeting - week of Jan. 24 - SCRA has graciously invited us back to Charleston, South Carolina
Spring 2007 Annual Conference - week of May 21 - Washington, DC
Summer 2007 Executive Committee Meeting - Chicago, Illinois - WPS Energy Services has generously offered to host the meeting.

Click here to view all past updates.
NEM Comments on Proposed Regulatory Filing Requirements

The Commission issued a proposed rule that would, “require companies, utilities, marketers and operators to file via email, a notice with the Commission of any filing it makes, or that is made on its behalf, with any federal or state government agency, department, board, or bureau.” The Commission issued the proposed rule because of its perceived “need to more closely monitor and participate in those proceedings before federal regulatory agencies that may have an impact on Georgia utilities and their ratepayers.” NEM urged the Commission not to adopt the proposed rule. Although the Commission attempted to limit the burden of the reporting requirement by seeking an email notice of the entity’s filing rather than a copy of the entire filing itself, NEM argued that this does not do enough to ensure that the costs and burdens of the reporting requirement are reasonably mitigated. Nor does the revised proposed rule sufficiently or clearly define the scope of the regulatory filings being sought. NEM urged the Commission to evaluate whether monitoring of FERC and state Commission sites would sufficiently serve its purpose of being apprised of proceedings “that may have an impact on Georgia utilities and their ratepayers.” This would avoid imposing a costly burden on competitive marketers that may have the unintended consequence of negatively effecting the pricing of competitive offers. The full text of NEM's Comments is available on the NEM Website.

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WPS Resources and Peoples Merger

WPS Resources and Peoples Gas/North Shore Gas filed an application for approval of reorganization transactions, including a merger. The companies are seeking Commission approval by the end of the year. The companies state that as a result of the reorganization, Peoples Gas/North Shore Gas will postpone their rate cases until early 2007 for rates to become effective in 2008. The companies maintain that gas supply savings will be realized by combining overlapping asset positions and managing them on a portfolio basis, and "steady-state savings are estimated at approximately $3 million in this area."

The companies testified that the transaction will not have an adverse effect on competition in the state. Rather, they argue that the combination of the non-regulated energy marketing entities involved may enhance competition. The text of the WPS Resources-Peoples Application is available on the NEM Website.

Commission Proceeding to Examine Time Based Meters and Interconnection Standards

As required by the federal EPAct, the Commission initiated a series of rulemakings. First, it will consider whether or not to adopt the EPAct standard on time-based metering and communications. The Commission will also consider in a separate proceeding whether or not to adopt the EPAct standard on interconnection. The full texts of the Orders Initiating the Time-Based Meter Rulemaking and Interconnection Rulemaking are available on the NEM Website.

New York
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Central Hudson Seeks to Include Risk Management Fees in Gas Supply Charge

Central Hudson filed a proposed tariff change to include risk management fees in its calculation of its Gas Supply Charge. Central Hudson noted that it uses various risk management products to reduce commodity price volatility. Central Hudson proposed that the change become effective October 31, 2006. Comments on the proposal are due October 2, 2006. The full text of Central Hudson's Filing is available on the NEM Website.

ConEd and O&R Capacity Release Program Modifications

ConEd and O&R have capacity release programs that provide gas marketers serving firm customers in their gas choice programs with the opportunity to obtain upstream pipeline capacity from ConEd or O&R to satisfy the Commission's firm primary delivery point requirement. The utilities seek an extension of their programs, which are set to expire on October 31, 2006. In addition to seeking an extension of their capacity release programs, ConEd and O&R propose to institute a limit on the change the utilities would be required to accommodate from year to year in the percentage of marketers' total capacity requirements obtained from the utilities. ConEd and O&R propose that marketers requests for changes in upstream capacity would be met in full provided that they fall within a 20% tolerance band - increases or decreases in the aggregate percentage of all Sellers' total capacity requirements to be obtained from ConEd/O&R does not exceed 20% of the aggregate percentage of all Sellers' total capacity requirements obtained from the utility in the prior year. If the tolerance band is exceeded, the utility would be able to adjust capacity requests proportionately to meet the 20% limitation. Comments on the ConEd and O&R's proposals are due October 2, 2006. The full texts of ConEd and O&R's Proposed Capacity Release Program Changes are available on the NEM Website.

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Order on Duke Energy Disconnection Rights

The Commission issued an Order permitting Duke Energy to disconnect customers for failure to pay competitive retail or electric gas charges when Duke Energy has purchased the accounts receivable of the competitive electric/natural gas supplier. The Commission previously approved DEO, Columbia Gas' and Vectren's requests to do the same. The Commission found it would, "have a positive effect on the competitive local retail gas and electric markets, resulting in less churn in the market and better planning of supply/demand by both Duke and the competitive suppliers." When Duke purchases receivables, it shall only include, "past due distribution, transportation and gas commodity charges and/or past due generation and transmission charges on the disconnect notice and any partial payments shall be applied to such past due charges before current charges or any other charges." Duke cannot disconnect a choice customer for failure to pay, "ancillary, non-regulated (i.e. line maintenance fees or late fees) service charges." Duke was ordered to implement the change by October 15, 2006. Likewise, competitive gas and electric suppliers were ordered to review their contracts and revise them as needed to be consistent with this change. The full text of the Order is available on the NEM Website.

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