NEM's Annual Membership Meeting and National Restructuring Conference will be held on March 31 and April 1, 2004, at the Capitol Hill Hyatt in Washington, DC. The Senate VIP reception will be held on March 31 at 6PM in the Senate Russell Caucus Room 325. If you would like to invite a spouse or a VIP to the reception please contact NEM Headquarters.

House Energy and Air Quality Subcommittee Chairman Barton, FERC Chairman Wood, CFTC Chairman Newsome, FERC Commissioner Brownell, CFTC Commissioner Brown-Hruska, NARUC President Wise, NJBPU President Fox, NARUC BPL Committee Chair and MIPSC Commissioner Chappelle have all confirmed that they will be presenting public policy addresses at the NEM event.

If you wish to exhibit at this event please contact headquarters ASAP. You may view the agenda and register for the event by using this hotlink. Registration Information is also available on the NEM Website.

NEM's Summer Executive Committee Meeting will be held during the last week of June in Colorado. NEM is exploring the possibility of holding a Marketer/Utility Leadership Summit during the second week of October. Please mark your calendars. Many thanks to HomePort and ESG for hosting the upcoming meetings.

NEM's March article for Harts magazine is entitled, "The Public Interest in a 21st Century Global Economy." The article reflects on the evolution of the energy industry and the public interest that utilities have an obligation to serve. The article posits that, "a late 19th Century, early 20th Century utility business model may not be well-suited for the high technology needs of a globally competitive digital economy of the 21st Century." The article recommends that, "the 'public interest' may be far better served if public utilities focus available capital and credit on the reliability of energy delivery networks and let the competitive marketplace underwrite the high costs, high risks and potential losses associated with buying and selling volatile commodities." The full text of the Article is available on the NEM Website.

EIA released a report on the, "Status of Natural Gas Residential Choice Programs by State as of December 2003." EIA reports that almost seven percent (4.2 million) of U.S. gas customers purchase gas from a marketers. The largest migration has been achieved in Georgia (1.4 million customers), Ohio (1.3 million customers) and New York (295,000 customers). These migration statistics are consistent with the findings and recommendations of NEM's Executive Committee.

The transitional rate design of the Georgia market highlights the importance of a utility's exit from the merchant function, identified as a priority by the Executive Committee. This supports NEM's decision to pursue a strategy of engaging with utilities to develop mutually beneficial competitive market transition designs.

The success of the Ohio market also highlights a number of transitional market structure recommendations of NEM's Executive Committee. These include the Ohio gas utilities purchase of marketer receivables, the movement to a monthly GCR to better reflect market conditions, and permitting cost-effective customer acquisition via phone, internet and wet signature.

The migration numbers in New York are reflective of the success of O&R's Switch and Save Program, from which a number of NEM's Executive Committee transitional market structure recommendations were derived. These include utility purchase of marketer receivables, marketer access to storage and capacity, and provision of performance-based migration incentives to utilities to promote customer switching. The full text of the EIA Report is available on the NEM Website.

FERC issued an Order on its Generation Interconnection rule. The Commission clarified that the transmission provider has the option of charging the interconnected customer a transmission rate that is the higher of the incremental cost rate for the network upgrades required to interconnect its generating facility or an average embedded cost rate for the entire transmission system, including the cost of network upgrades.

The Commission revised two aspects of the rule pertaining to the method of reimbursing generators for the cost of financing network upgrades needed for interconnection as follows: 1) the transmission provider will not be required to provide credits to interconnection customers for all of the transmission delivery services the customers take, rather only for the transmission delivery service taken by the interconnecting generation facility; and 2) the transmission provider can choose, five years prior to the generation facility operations date, whether to reimburse the interconnection customer at that time for any remaining balance of the cost of financing network upgrades and accrued interest, or to continue to provide credits beyond five years until there is no remaining balance. The Commission decided that it will provide additional flexibility to interconnection pricing proposals filed by an independent transmission provider. The full text of the Order will be posted on the NEM Website when made available electronically.