AUSenergy News Update 10/28/2014
Oct 28, 2014

In today’s AUSenergy News Update: New ISO New England Tariff Winter Reliability Program, ComEd Minimum Stay Eliminated, and PJM 2015 Capacity Auction Plans Complicated by EPSA Stay.

New ISO New England Tariff Winter Reliability Program

Summary: The Winter Reliability Program is a new tariff affecting ISO New England states. The main idea behind this tariff is to mitigate significant reliability concerns for the upcoming winter. It creates an additional cost charged by electricity grid operators to electricity suppliers during the winter. This charge is to ensure that the grid has enough power during peak demand times when the grid must seek alternative generation sources for electricity besides natural gas.
AUS Comment: As of right now, this additional cost is being passed through by providers and is not included in Fixed All Inclusive prices.

ComEd Minimum Stay Eliminated

Summary: ComEd announced that residential and small commercial customers purchasing electricity from the utility may switch to a retail electric supplier at any time. If ComEd’s electricity supply customers choose to switch to a retail electric supplier, they will no longer be required to remain with ComEd for a minimum period of time, ComEd said.
AUS Comment: By eliminating the minimum stay period of 12 months, ComEd has made it easier for aggregation programs to take advantage of competitive pricing as soon as they occur.

PJM 2015 Capacity Auction Plans Complicated by EPSA Stay

Summary: On October 20, 2014, the D.C. Circuit granted a stay on its ruling to overturn FERC’s Order 745. The ruling stipulated that regulation of demand response (DR) resources are the realm of the states, not federal agencies. The stay lasts until Dec. 16, giving U.S. Solicitor General Donald B. Verrilli Jr. time to file a petition for certiorari on FERC’s behalf. If Verrilli files the petition, the stay will remain in effect until the Supreme Court either rejects the request, or accepts it and decides the case on its merits. Demand response aggregators have questioned whether the EPSA ruling will affect FERC’s jurisdiction over capacity. They say the RTO’s proposed response will upset existing business relationships and reduce DR’s role.
AUS Comment: DR plays an important role in PJM’s capacity auctions. This court ruling is a frustrating development for consumers as well as the environment. Consumers will likely see increased electricity prices along with dirtier fossil-fuel burning power plants being built. The court ruling has also generated a great deal of uncertainty regarding the future of demand response. It’s likely that DR resources will be reduced in the marketplace and states will need to take a far more active role in helping DR to compete with other resources on a level playing field.

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