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August 20, 2010
NEM Upcoming Events

Please mark your calendar for NEM's Fall Leadership Roundtable on October 18-20, 2010, in Harrisburg, PA. The conference will take place at the Hilton Harrisburg on One North Second Street. You may register for the Fall Meeting in Harrisburg at this hotlink.

Our Annual Winter Executive Committee Meeting is scheduled for January 17-19, 2011, in Miami at the famous Doral Hotel and Resort. Many Thanks to Doug Marcille, Vice Chair of NEM’s Executive Committee and CEO of US Gas and Electric for hosting this upcoming Executive Committee Meeting.

NYISO Report on Lake Erie Loop Flows

As required by FERC, NYISO filed a report on broader regional market issues and Lake Erie loop flows. NYISO's report discusses the work to date it has engaged in with IESO, PJM and Midwest ISO to develop concepts, including 1) Buy-Through Congestion, 2) Market-to-Market Coordination, 3) Interface Pricing Revisions, and 4) Enhanced Interregional Transaction Coordination. Comments on NYISO's Report are due September 15, 2010. The full text of the NYISO Report is available on the NEM Website.

Click here to view all past updates.
IPA Draft Procurement Plan for 2011-2016

The Illinois Power Agency (IPA) has prepared its draft procurement plan for June 2011 through May 2016. The Draft Plan sets forth an approach to procuring electric commodity and transmission services, and renewable assets to meet the RPS for eligible ComEd and Ameren customers. "The IPA maintains that a medium-term laddered approach to procurement for energy and capacity resources provides a high level of cost stability for consumers while still leaving room for some larger market trends - namely consumer migration from the IPA portfolio and the regulatory climate for fossil fuel power generators - to be better identified and assessed. The IPA proposes to continue the practice approved by the Commission in the 2009 and 2010 Procurement Plans of scheduling procurements of wholesale energy and capacity resources relatively evenly over three-year periods."

August 26, 2010 - Chicago Workshop
August 31, 2010 - Springfield Workshop
September 15, 2010 - Comments Due to IPA on Draft Procurement Plan
September 29, 2010 - IPA Revised Procurement Plan
October 4, 2010 - Objections to the Plan Due to the Commission
October 14, 2010 - Commission Determination of Whether Hearing is Necessary
December 28, 2010 - Commission Order on the Plan

The full texts of the Draft Procurement Plan and Notice are available on the NEM Website.

Click here to view all past updates.
Conference on PJM's Reliability Pricing Mechanism

The Commission will hold a conference to examine issues related to PJM's Reliability Pricing Mechanism (RPM) and the results of the 2010 Base Residual Auction for the 2013-14 delivery year in particular. The conference will be held October 14 and 15, 2010, in Annapolis. The Commission is concerned that the RPM has not attracted new generation or a sustained amount of demand response participation. The Commission is also interested in discussing whether and how RPM should be changed or abandoned, and how the Commission's policies impact participation in the capacity market.

The Commission requested comment on the following questions:
"1. What value or benefit will customers in the MAAC zones receive in exchange for the higher capacity prices they will pay in 2013-14? Is it true that because the MAAC and DPL South zones cleared below Net CONE, RPM is not incenting new developments in those zones? If the Commissioners were asked by the public to explain the purpose of the capacity market and the benefit customers receive from capacity payments, what should they say?
2. Identify and explain, with specificity, the mechanisms in the tariff, operating agreement, and manuals, that explain the resource clearing price for the MAAC and Pepco LDAs in the BRA for the 2013/2014 Delivery Year being higher than the RTO clearing price.
3. Why was the capacity clearing price for the 2013-14 planning year so much higher in MAAC than the clearing price for the 2012-13 planning year? What changed? What new price signals or economic incentives does the higher 2013-14 clearing price send?
4. What changes have been considered to RPM or within the PJM stakeholder process that could potentially facilitate more levelized capacity prices throughout the RTO?
5. What changes could be made to RPM that would stimulate increased generation and demand response investment in Maryland? Should RPM be kept as is, amended or abandoned?
6. Should the Commission monitor or regulate the participation of regulated electric companies with regard to their capacity offers of Demand Response and Energy Efficiency? If so, how? If not, why not?
7. What mechanism exists in PJM’s market rules and procedures that allows PJM to inform and share data with state commissions of the specific measures that could be undertaken by the state commissions to reduce energy and capacity costs for customers, and how do such procedures operate?
8. What duty does PJM have, or should it have, to facilitate levelized capacity prices across the RTO?
9. What can or should the Commission do to address these issues at PJM, FERC or elsewhere?"

Notices of Intent to Participate are due by August 27, 2010. Written comments are due October 1, 2010. The full text of the Notice of Public Conference is available on the NEM Website.

New York
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Consumer Bill of Rights Legislation

The Governor signed S2361, establishing an ESCO consumer bill of rights. S2361 provides that the Commission will develop the bill of rights which shall be provided by ESCOs to prospective customers. It also establishes limits on early termination fees as follows, not in excess of: 1) one hundred dollars for any contract with a remaining term of less than 12 months; 2) two hundred dollars for any contract with a remaining term of 12 months or more; or 3) twice the estimated bill for energy services for an average month. In order to charge the ETF, the ESCO must have provided the customer with an estimated bill for an average month at the time the contract was offered. Material changes in contract terms or duration are not permitted with a customer's express consent. All variable charges must be identified in every contract and all marketing materials to prospective buyers. Contracts cannot require customer prepayment, but may be offered as a customer option. S2361 also provides consumers with a private right of action for violation of its provisions. The full text of S2361 is available on the NEM Website.

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Commission Approves Columbia Gas Settlement

The Commission approved the ALJ's Recommended Decision accepting the settlement reached among parties to a Columbia Gas case. The settlement provides that:

1) Columbia will not make further offers under its Pilot Rider Price Protection Service and will not seek to extend the program after its February 28, 2011, expiration date.
2) Columbia will not engage in further mass advertising of its Negotiated Contract Service. Columbia may however promote it on its website in a place as favorable to links to supplier websites.
3) The volumetric limit for Rate SCD is inreased to 4000 Mcf/year.
3) Over and under-delivery penalties will be modified as follows: $25.00/Mcf when an OFO/OMO is not in effect; and $50.00/Mcf on days in which an OFO/OMO is in effect.
4) Unbundling of gas uncollectibles will be set on a permanent basis to update the charge applied to Price to Compare to 1.66% to reflect recovery of uncollectibles associated with gas costs.

The full text of the Order and Recommended Decision are available on the NEM Website.

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