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May 6, 2005
NEM's Annual Membership Meeting and Restructuring Conference

This year's Membership Meeting and Restructuring Conference was a resounding success. We were fortunate to be joined by Chairman of the House Subcommittee on Energy and Air Quality Ralph Hall, FERC Chairman Wood, FERC Commissioner Kelly, CFTC Chair Brown-Hruska, Commissioner Weiss and Ron Cerniglia of the NYPSC, NJBPU President Fox, Ohio PUC Chair Schriber and Commissioner Mason, MIPSC Commissioner Chappelle and the new appointee to Chair the California Energy Commission, Joe Desmond. We were also privileged to have our VIP Reception at the Canadian Embassy.

Many thanks to all of our sponsors, speakers, members and potential members in attendance. The event would not be possible without your input and support.

Eastern RTO/ISO Conference Announced

The 2005 Eastern RTO/ISO Conference will examine wholesale electricity markets, particularly markets served by the New England ISO, the New York ISO, PJM, and eastern Canada. As previously reported by NEM, the topics will include resource adequacy and interregional planning, generation procurement and capacity markets, market monitoring, reliability, interregional seams, and new interregional initiatives like greenhouse gas credits trading, renewable resources attribute trading, and energy source labeling.

The conference will be in Washington, DC on May 11-12 and is being organized by 19 state regulatory agencies. To register, go to

Liquid Drop Out and Gas Interchangeability Technical Conference

A technical conference will be held by FERC on the issues of liquid hydrocarbon drop out in natural gas infrastructure and on natural gas interchangeability. The technical conference is to accept additional comments on the Natural Gas Council's reports and recommendations on these issues.

The conference is scheduled for May 17.

Click here to view all past updates.
Commission Issues Reports on Restructuring

The Commission has issued a report on electric restructuring and gas restructuring. The report lists suppliers, rate comparisons, market shares, etc. For electricity, the Commission reports that 6% of the residential market or 7.6% of MW customer demand have switched to a supplier, with 17.4% of non-residentials, or 72.9% of non-residential MW customer demand. For gas, suppliers are serving 10% of residential customers and 31% of commercial accounts.

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Competitive Technical Implementation Working Group Report Filed

The Competitive Technical Implementation Working Group (CTIWG) has filed a report on the application of consumer protection rules to non-residential customers. The CTIWG recommends adoption of regulations as follows: 1) "suppliers should have access to customer payment and billing data for all their currently-enrolled consolidated billing customers (i.e., residential and non-residential)"; and 2) "there should be no Commission-created contract rescission right for non-residential electric or gas supply contracts." The CTIWG was unable to reach consensus on whether non-residential customers should be able to terminate service with an electric supplier either by contacting the supplier or the utility. Comments will be filed on this issue on May 16, 2005. The full texts of the Report and Proposed Regulations are available on the NEM Website.

Click here to view all past updates.
Michigan Fines Detroit Edison for Not Enrolling Customers on a Timely Basis

The Commission issued an order fining Detroit Edison $975,000 for violating its tariff and failing to process new customers of suppliers within 45 days. The Commission also directed the Administrative Law Judge to determine costs, reasonable attorney fees and damages incurred by the complainants/suppliers and the excess meter reading charges paid by the suppliers' customers.

The Chairman stated that "It is undisputed that Detroit Edison has engaged in anti-competitive behavior and thrwarted customer choice and the intent of the Public Act 141 by failing to complete enrollment activities for electric choice customers within 45 days." The order observes that Detroit Edison managed to delay or deny altogether choice for thousands of customers. The full text of the Order is available on the NEM Website.

Detroit Edison's Supply Cost Recovery Plan Set for Hearing

A prehearing conference has been set for May 17 for Detroit Edison's 2004 stranded costs and power supply cost recovery plan case. Interventions are due by May 10.

New Jersey
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Meeting on Extension of Renewable Portfolio Standard

The BPU will hold two stakeholder meetings to receive input on the extension of the renewable portfolio standard beyond 2008 to 20% in 2020 for Class I renewables. The Commission will then initiate a rulemaking in August 2005. The first meeting will be held May 17, 2005, at 9:30AM at the Bloustein School of Planning and Public Policy at Rutgers University in NewBrunswick. The second meeting will be held June 16, 2005, at 9:30AM at the Board's Hearing Room at 2 Gateway Center, 8th floor in Newark.

New York
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Important ConEd and National Grid Meeting Dates

Two ConEd meetings will be held at the Commission's Manhattan offices. On May 12, 2005, at 10:30AM a meeting will be held to initiate a collaborative process to study issues associated with a retail market auction pilot program in the ConEd service territory. On May 23, 2005, at 10:30AM a meeting will be held to begin a collaborative process to study issues with ConEd's embedded cost of service study.

On May 9, 2005, there will be a collaborative meeting on National Grid's Competitive Opportunities Development Plan. The meeting will take place at National Grid's Albany offices at 1125 Broadway.

Click here to view all past updates.
Rates Set for CG&E Non-Residential Returning Customers

In its order on rehearing, the Commission adopted a return pricing methodology for nonresidential customers, which mirrors the Commission's decision for FirstEnergy. CG&E may charge the locational marginal price (LMP) associated with the node applicable to a non-residential customer or the load-weighted average if a specific node cannot be identified. The Commission has decribed this as market-based pricing relevant to customers and price transparency. The Commission also adopted the rate stabilization price as the floor.

Shopping customers who return at the end of their contract with a supplier will be treated as if they never shopped for supply. Also, nonresidential returning customers who agree to pay the RSC and the AAC may return to CG&E at the rate-stabilized price. The full text of the Order is available on the NEM Website.

Mon Power's Standard Offer Service and Wholesale Competitive Bidding Approved

The Commission approved Monongahela Power's fixed rate market-based standard offer service, variable standard offer service for large commercial and industrial custoemrs, and wholesale, competitive bid process. The competitive bid process was approved for this bid, but the Commission may look at other approaches for future bids. The fixed rate will be seasonal, with a summer and non-summer charge. Mon Power's revised RFP is due within 30 days.

The Commission found that the proposed administrative adders (for a return and incremental costs), ranging from 5.5 miills to 6.5 mills/kWh, may be unreasonable. The administrative adders will be subject to a hearing. Mon Power's testimony and interventions are due May 23, with intervenor testimony due June 13 and a hearing on June 28. The full text of the Order is available on the NEM Website.

Ohio Decides to Make Public Some of the FirstEnergy Auction Records

The Commission has decided that some of the records regarding the FirstEnergy auction can be made public. However, proprietary information will not be released and information regarding the identity and amount of the bids will be kept confidential for 18 months.

Bidders may disclose that they were registered to bid, the amount of their indicative bid, and their first round bid.

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NEM Comments on Provider of Last Resort

NEM submitted comments on the Commission's proposed Provider of Last Resort rules. NEM recommended, consistent with the Commissionís statutory authority, that the Commission set a date certain by which the utilities must exit the merchant function. NEM also recommended that the Commission focus its initial efforts in developing the competitive electric market by requiring the utilities to file fully allocated embedded cost-based rates to provide consumers with proper price signals. The full text of NEM's Comments is available on the NEM Website.

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