Recent Pennsylvania PUC Decisions
July 25, 2014
On July 24th, The Pennsylvania PUC approved a default service plan for the FirstEnergy Pennsylvania utilities (Met Ed, Pennelec, Penn Power and West Penn Power) covering the period June 1, 2015 through May 31, 2017.
In addition to approving a wholesale power procurement plan for default service, the PUC also approved a settlement that called for the EDCs to assume the obligation for the following PJM charges for all distribution customers: Regional Transmission Expansion Plan (RTEP) charges, Expansion Cost Recovery charges (ECRC), unaccounted for energy (UFE), reliability must run (RMR) generating unit declarations and deactivations of generating plants qualifying for such payments after the Commission’s approval of the revised default service plan, and historical out of market tie line, generation, and retail customer meter adjustments. The costs of these items will be recovered via a nonbypassable distribution charge.
However, the PUC ruled that retail suppliers shall continue to be responsible for Network Integration Transmission Service (NITS) costs. Commissioner Gladys Brown dissented from the PUC’s decision on this point, stating that relieving retail suppliers and default service suppliers of the NITS obligation, with such costs instead recovered by the utilities through a nonbypassable charge applicable to all customers, would reduce risk premiums in both default service prices and competitive offers.
The key question is whether the PUC will order replication of this result for other EDCs. If not, suppliers will have to “customize” their offers and marketing in each service territory, taking account of which charges are covered by the EDC and which are the responsibility of the supplier in each service territory. End user customers too will have to be vigilant to insure that their contract do not contain a line item for one of these PJM charges that are now being procured by the EDC.
This Eckert Seamans Energy and Utilities Blog is intended to keep readers current on matters affecting businesses and is not intended to be legal advice. If you have any questions about the content of this post, please contact Dan Clearfield at (717) 237-7173; dclearfield@eckertseamans.com.