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Pennsylvania Clarifies Price Under Retail Opt-in Program at FirstEnergy Utilities

By: Energy Choice Matters |

The Pennsylvania PUC, in an order on rehearing and clarification, has clarified the price that will be charged to customers participating in the retail opt-in program at the FirstEnergy electric distribution companies, for service beginning June 1, 2013.

As first reported by Matters, the PUC, in adopting a default service plan at the FirstEnergy EDCs, replaced the proposed opt-in retail auction with an opt-in “program” under which customers would receive a $50 bonus from their retail supplier, a four-month guaranteed 5% discount off of the Price to Compare at the time of enrollment, and a retail supplier-provided fixed-price product for the remaining eight months of the program term.

The PUC clarified that the term “time of enrollment” means when the customer enrolls in the retail opt-in aggregation program, not the start date for service under the program.

In other words, the discount from the Price to Compare will be off of the PTC in effect when customer enrollment into the opt-in program occurs (which may be nearly two months prior to June 1, 2013), rather than a discount off of the June 1, 2013 PTC.

The PUC declined to provide clarification regarding the price to be offered by retail suppliers for the eight-month remaining portion of the opt-in program, stating that this issue should first be addressed in a previously ordered collaborative. Among other things, the Office of Consumer Advocate had asked whether the eight-month fixed price will be identical for each retail supplier.

While the PUC did not offer further specifics on the eight-month price, it did confirm that it will require retail suppliers to file pricing for the eight-month term for PUC review. “[W]e emphasize that EGS participation in the ROI programs is voluntary. As a condition to an EGS’s voluntary participation in the ROI [retail opt-in] programs, we have directed that EGSs which want to participate will file their proposed terms and conditions, including pricing, for our review. Given that EGS participation is voluntary, and that the ROI programs will be implemented and conducted under the auspices of this Commission, we find that it is entirely appropriate to provide for our review of EGS ROI proposed offerings, including terms, conditions and pricing,” the PUC said.

The PUC also declined to provide further specifics on the customer assignment process for the opt-in program (as an auction is no longer required), stating that the issue should be addressed first by the collaborative.

The PUC also agreed that, at Penn Power and West Penn Power, small commercial customers up to 50 kW and 100 kW, respectively, may participate in the retail opt-in auction and other retail market enhancements, due to the composition of rate classes at each utility. The PUC’s prior order contemplated that the retail market enhancement programs would be open to small commercial customers up to 25 kW or, in the alternative, customers in the smallest rate class, and the smallest rate class at Penn Power and West Penn Power include customers up to 50 kW and 100 kW, respectively.

The PUC also affirmed that PJM generation deactivation costs shall remain the responsibility of the load serving entity (retail supplier or default supplier as applicable). “These generation deactivation costs are inherently part of the supply of electricity. Consistent with the Commonwealth’s continued migration to a more competitive retail market, we believe that these supply-related costs should remain with the EGSs,” the PUC said.