Direct Energy recommends that the Commission reject GSA PECO’s proposal. Direct Energy argues that proposal conflicts with the PECO’s final order in its Investigation of Retail Electricity Market: Commission’s Pennsylvania’s at Docket No. I-2011-2237952 (Order entered February 15, End State of Default Service 2013) (End in which the Commission recommended that future State Final Order) default service plans move to procurements no less frequently than quarterly, even for residential customers. Direct Energy states that the Commission should require PECO and interested stakeholders to explore other options for minimizing fluctuations in the PTC that are unrelated to movements in the underlying prices of default service wholesale contracts. Direct Energy avers that proposed annual GSA adjustments PECO’s would be a step backwards from the commitment to keep retail prices as Commission’s reflective of market prices as possible. Direct Energy M.B. at 18-19. Disposition Annual Reconciliation of the GSA We concur with Direct Energy that proposal to reconcile the GSA PECO’s on an annual basis runs counter to the findings and recommendations that were developed through the RMI and were presented in the In that Order, the End State Final Order. Commission explained that it relied on several underlying principles including the default service model to more closely reflect current market “structuring conditions.” at 10. The Commission addressed the characteristics of default End State Final Order service procurement and cost recovery that can lead to the inclusion of significant costs in the PTC that have little or no relationship to current energy prices. at 23-24. The Id. End also addressed how a PTC, that does not reflect current market prices, State Final Order can jeopardize the viability and the benefits of a competitive retail market. Id. Therefore, the Commission has proposed, the implementation of a ninety-day inter alia, default service product for residential and small commercial customers that is able to track current conditions more closely. at 41. Id.
Direct Energy recommends that the Commission reject PECO’s GSA proposal. Direct Energy argues that PECO’s proposal conflicts with the Commission’s final order in its Investigation of Pennsylvania’s Retail Electricity Market: End State of Default Service at Docket No. I-2011-2237952 (Order entered February 15, 2013) (End State Final Order) in which the Commission recommended that future default service plans move to procurements no less frequently than quarterly, even for residential customers. Direct Energy states that the Commission should require PECO and interested stakeholders to explore other options for minimizing fluctuations in the PTC that are unrelated to movements in the underlying prices of default service wholesale contracts. Direct Energy avers that PECO’s proposed annual GSA adjustments would be a step backwards from the Commission’s commitment to keep retail prices as reflective of market prices as possible. Direct Energy M.B. at 18-19. Disposition Annual Reconciliation of the GSA We concur with Direct Energy that PECO’s proposal to reconcile the GSA on an annual basis runs counter to the findings and recommendations that were developed through the RMI and were presented in the End State Final Order. In that Order, the Commission explained that it relied on several underlying principles including “structuring the default service model to more closely reflect current market conditions.” End State Final Order at 10. The Commission addressed the characteristics of default service procurement and cost recovery that can lead to the inclusion of significant costs in the PTC that have little or no relationship to current energy prices. Id. at 23-24. The End State Final Order also addressed how a PTC, that does not reflect current market prices, can jeopardize the viability and the benefits of a competitive retail market. Id. Therefore, the Commission has proposed, inter alia, the implementation of a ninety-day default service product for residential and small commercial customers that is able to track current conditions more closely. Id. at 41.
1266207.docx