The Commission issued an Order setting forth a regulatory framework for the electric utilities to resume their full procurement responsibilities on January 1, 2003. Inasmuch as the Department of Water Resources has entered into long-term contracts that provide a large percentage of bundled energy service requirements through 2008, the Order addresses the utilities ability to meet their residual net short (RNS) requirements. The Commission found that the remainder of the utilities RNS can be, "met through a combination of directly contracting with wholesale energy suppliers, purchases in the energy markets administered by the ISO, and purchases of demand-side resources, including distributed and self-generation." The Commission also ordered that a moratorium be placed on Edison, PG&E, and SDG&E's dealings with their own affiliates in procurement transactions as of January 1, 2003, pending a reexamination of affiliate rules. The full text of the Order is available on the NEM Website.

The Commission initiated a rulemaking proceeding to examine the, "establishment of standards for determining whether or not prices are constrained by market forces and for determining, in a case when prices are unconstrained, if those prices are significantly higher than they would be if they were constrained." While recognizing the authority granted to the Commission to intervene in the markets, including imposing price regulations on marketers, NEM urged that Commission intervention in the market should be a last resort measure reserved for true periods of emergency. NEM argued that if the Commission showed a willingness to intervene in the market under less than emergency conditions it would send a severe, negative signal to participants in the natural gas market in Georgia as well as to participants in competitive retail markets across the country. The full text of NEM's Comments is available on the NEM Website.

Many thanks to Harry Kingerski of Shell Energy Services for his assistance with this proceeding.

Staff has requested comments on electric competition in the state for the possible inclusion in a report to the General Assembly. Staff has requested comments on a number of issues including: 1) barriers to entry; 2) impediments to the establishment of competitive retail and wholesale markets in Illinois; 3) means of encouraging competitive retail activity; 4) necessary modifications to policies on interconnection of large generation and small generation as well as back-up rates; 5) the legislature and Commission's role in promoting load response; 6) the legislature and Commission's role in promoting load aggregation; 7) necessary modifications to the transition charge and market value index policies; 8) necessary modifications to customer switching rules; 9) the legislature and Commission's role in promoting advanced technologies for electric generation, transmission, distribution, or usage; 10) necessary modifications to affiliate standards; and 11) necessary modifications to reciprocity standards. Comments are due November 12, 2002, and should be sent to: eschlaf@icc.state.il.us. The full text of the Request for Comments is available on the NEM Website. Members should submit their comments to headquarters by November 7, 2002.

The Commission issued an Order on telephonic and internet enrollment of electric customers. Contrary to the recommendations of NEM, and despite the Commission's finding that, "telephonic enrollment would be a valuable tool that could potentially advance [] development" of the retail market," the Commission concluded that telephonic enrollment is not permitted by the state restructuring law or electronic signature legislation. However, the Commission did find that internet enrollment is permitted under the state restructuring law and electronic signature laws and adopted rules for use of internet enrollment. The full texts of the Order and Internet Enrollment Rules are available on the NEM Website.

The ALJs in the proceeding on ComEd's petition to declare service to customers 3MW or above on Rate 6L as competitive have issued a post exceptions proposed order (PEPO). The PEPO adopts many of the recommendations of NEM. The PEPO concludes that the petition for competitive declaration should be granted by operation of law. The PEPO reasons that ComEd's petition has met the statutory requirements for a competitive declaration as follows: 1) ComEd has identified a subject customer segment or group of customers for the declaration; 2)RES flowed power and energy is a reasonably equivalent substitute service; 3) comparable prices for power and energy to Rate 6L are available; 4) customers with usage of 3MW and above are being served by more than one provider other than the electric utility or an affiliate of the electric utility; 5) ComEd has sustained a loss of business to alternative suppliers for the relevant customers; 6) ComEd has adequate transmission capacity into the service area to make electric power and energy reasonably available; and 7) there has been substantial customer switching in the relevant customer class. The PEPO also finds that new customers can initiate service under Rate 6L during the three-year transition period. The PEPO rejects Staff’s proposal to require ComEd to allow customers that are taking service from competitive suppliers to return to service under Rate 6L by giving thirty days notice prior to the end of their contract. The full text of the PEPO is available on the NEM Website.

The utilities have posted new drafts of the Basic Generation Service-FP and Basic Generation Service-HEP Supplier Master Agreements. The documents are available at: http://www.bgs-auction.com/bgs.bidinfo.cc.asp. The next bidder information session for the Basic Generation Service auction will be held December 3, 2002, at the Westin Hotel in Philadelphia. Further details will be forthcoming.

NEM submitted a trial brief in the ConEd unbundling proceeding. NEM argued that ConEd did not comply with Commission Orders requiring the filing of an embedded cost study but rather filed an avoided cost study. NEM also argued that ConEd's proposed stranded cost recovery mechanisms did not comply with Commission Orders because they did not use a two-part method in which competitive service costs would not be applied to customers that migrate. The full text of NEM's Brief is available on the NEM Website.