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August 19, 2011
Upcoming NEM Meetings

October 2011 NEM Fall Leadership Roundtable – NEM’s Fall Leadership Roundtable will be held in Trenton, NJ on October 11-12, 2011. The Chairman of the NJBPU has confirmed his attendance and invitations to the other Commissioners, the Governor’s office and state legislators are also being extended for this event.

Early Bird registration is now available on the NEM website. Special NEM hotel rates are $99 per night at the Marriott Trenton Downtown, 1 West Lafayette Street, Trenton, NJ 08608, and (866) 373-9806. Use this hotlink for hotel reservations.

January 2012 Executive Committee Meeting - NEM’s Annual Winter Executive Committee Meeting will be held at the headquarters of SCRA in Charleston, South Carolina on January 24-25, 2012. The Winter Executive Committee Meeting is where Executive Committee members set NEM's course for the coming year. Many thanks to Bill Mahoney and SCRA for hosting the Winter Executive Committee meeting.

You may register for the meeting at this hotlink. NEM has a room block at the Hilton Garden Inn Charleston Airport, 5265 International Blvd in North Charleston, SC. You may register for the hotel at this hotlink or call the reservation number 843-308-9330 or 1-800-HILTONS and reference group code NLL.

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ComEd POR Discount Rate Order on Rehearing

The Commission issued an Order on rehearing in the ComEd discount rate proceeding. The issue before the Commission was whether to retain the current practice of blending uncollectible factors for residential and commercial customers to derive a single rate or whether two separate factors should be used for these two customer groups. The Commission ordered that the blended rate should be used by ComEd, finding that the statute, "does not permit this Commission to devise more than one “rate” for POR services." Additionally, in support of this conclusion the Commission found that on a policy basis, "that the people of the state of Illinois, competition in this state, and, the interests of the retail electric suppliers are best served by the blended uncollectible rate that was adopted in the final Order in this docket." The full text of the Order on Rehearing is available on the NEM Website.

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Rehearing of Order on BGE Calculation of Discount Rate

The Commission issued a notice of opportunity to respond to rehearing requests filed on the Order setting the annual recalculation of BGE's POR discount rates. WGES sought rehearing of the aspect of the Order that, "reset the negative discount rates for three commercial classes computed under approved tariff provisions to zero and to allow BGE to bank over-collections from suppliers without a reasoned explanation or findings of fact supported by substantial evidence." WGES recommends that, "the Commission should direct BGE to apply the revised negative discount rates computed by tariff for the Type II, HPS and General Schedule C classes. Alternatively, the Commission could order BGE to reimburse the over-collections to suppliers who paid them if [sic] provides a reasoned interpretation of BGE's tariffs. The Commission should further consider instituting a separate proceeding to consider revising the POR provisions of BGE's supplier tariffs and similar tariffs of other utilities." BGE additionally sought rehearing of the Order as to the Commission's decision to allow BGE to earn interest on imbalances at a rate equivalent to that for customer deposits.

Responses to the requests for rehearing are due September 23, 2011. The full texts of the Notice of Opportunity to Respond, BGE Rehearing Request and WGES Rehearing Request are available on the NEM Website.

Rehearing of Order on Treatment of ETFs as Commodity Charges Under POR Programs

The Commission issued a notice of opportunity to respond to the rehearing request of WGES of its action declining to treat early termination fees as commodity charges for purposes of utility POR programs. In its rehearing request WGES argues that the ruling, "deeming ETFs are not 'supplier charges' eligible to be treated as 'supplier receivables' on a utility's consolidated bill under COMAR (1) represents an arbitrary and capricious departure from a long standing rule and policy without adequate explanation, (2) represents an arbitrary and capricious failure to comply with the Commission's own regulations, (3) relies on a prior order that, as interpreted, adopts a new rule and policy that fails to comply with due process requirements under the Maryland Administrative Procedure Act (APA), and (4) relies on factual findings not supported by substantial evidence in the record.

On rehearing the Commission should reverse the July 13 Ruling and reinstate the long standing combined billing practice and rule of treating ETFs as 'supplier charges' eligible for combined billing that it has followed since 1996."

Responses to the request for rehearing are due September 23, 2011. The full texts of the Notice of Opportunity to Respond and Request for Rehearing are available on the NEM Website.

New York
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Smart Grid Policy Statement

The Commission adopted a smart grid policy statement, establishing guidelines for the utilities to follow in the development of smart electric grid systems. The guidelines provide that:

"In the short term, utilities are to pursue established and reliable technologies that can provide a relatively certain return on investment. In the longer term, the billions of dollars the federal government has provided for smart grid projects nationwide will generate a significant base of knowledge and experience which, along with further development of smart grid standards, will help identify those technologies that are most effective and efficient.

Smart grid technologies will utilize a hybrid of both public and private networks. Utilities and communication providers should work together to ensure appropriate use of commercial facilities, and to limit utility capital investments in dedicated communications infrastructure.

Utilities must provide basic information on smart grid to customers who are largely unaware of this technology. Utilities further must provide a thoughtful and comprehensive customer education plan before commencing with implementation of technologies that require extensive customer engagement.

Smart grid projects must be able to show demonstrable benefits in excess of costs.

For most smart grid projects, rate recovery will be addressed through traditional means. The Commission will consider risk-sharing mechanisms for novel or unproven technology.

Utilities can start to develop smart grid plans and projects using the existing industry standards as building blocks.

Utilities must develop the capability to build and maintain cyber security standards. Utilities will bear the responsibility to ensure that cost-effective protection and preparedness measures are employed to deter, detect, and respond to cyber attacks, and to mitigate and recover from their effects.

Utilities and third-party providers must protect customer privacy when projects involve the collection and use of customer data."

The full text of the Smart Grid Policy Statement will be posted on the NEM Website when made available electronically.

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NEM Comments on Gas Competition Regulations

NEM filed comments with the Independent Regulatory Review Commission in suppport of the Public Utility Commission's Revised Final Rulemaking Order on gas competition regulations. NEM noted its longstanding support for the measures the PUC adopted, namely: 1) reformulation of the utilities Price to Compare (PTC) to be more reflective of market-based pricing signals as well as reflective of all of the costs incurred in providing default service in order to provide consumers with a better basis of comparison of utility versus competitive offerings; 2) establishment of permanent rules for utility purchase of receivables (POR) programs; and 3) non-discriminatory capacity release programs in which capacity assets follow the customer. NEM urged the IRRC to expeditiously approve the regulations. The full text of NEM's Comments is available on the NEM Website.

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