Energy Legal Blog

A central issue in the proceeding will be whether demand response providers are “electricity suppliers,” which the Maryland Code defines as someone “(i) who sells: 1. electricity; 2. electricity supply services; 3. competitive billing services; or 4 competitive metering services; or (ii) who purchase, broker, arrange, or market electricity or electricity supply services for sale to a retail electric customer.” If determined to be electricity suppliers, then demand response providers may be subjected to a host of new licensing and compliance responsibilities, including creditworthiness, registration, marketing, reporting, and record retention, depending on the outcome of the proceeding. (more…)

Baltimore Gas & Electric (BG&E) won Maryland PSC approval late Friday for an $833 million smart grid plan pursuant to which it will install 3,000 smart meter devices per day through 2014. Without timely PSC approval, BG&E risked losing approximately $200 million in Department of Energy subsidies to implement the plan.

The PSC rejected BG&E’s original plan, which included the large-scale build-out of advanced meters and mandatory time-of-use (TOU) billing because the PSC opposed (1) granting BG&E a rate tracker to recover smart grid costs as they are incurred as opposed to following a prudence determination, and (2) imposing TOU rates on all retail customers. The PSC also faulted the original BG&E proposal as doing too little to educate customers on how smart grid programs would work. The PSC nevertheless invited BG&E to resubmit its proposal to address these concerns. (more…)

After designating two bilateral Mid-Columbia (Mid-C) electricity contracts traded on the Intercontinental Exchange (ICE) as significant price discovery contracts (SPDC), the Commodity Futures Trading Commission (CFTC), in July 9th orders, designated four additional ICE electricity contracts used in organized Regional Transmission Organization (RTO) markets as SPDCs.  The four contracts are the SP-15 Financial Day-Ahead LMP Peak (SPM) and SP-15 Financial Day-Ahead LMP Off-Peak (OFP) contracts for the California ISO and the PJM Western Hub Real Time Peak (PJM) and PJM Western Hub Real Time Off-Peak (OPJ) contracts for the PJM Interconnection.  SPDC designation subjects these contracts to heightened regulatory oversight and reporting requirements.  At the same time, the CFTC issued two other orders finding that two daily SP-15 and two daily PJM contracts were not SPDCs.  (more…)

In June 25th Orders, the Commodity Futures Trading Commission (CFTC) for the first time designated two monthly electricity contracts traded at the Mid-Columbia (Mid-C) hub on the Intercontinental Exchange (ICE) - the Mid-C Financial Peak (MDC) and Mid-C Financial Off-Peak (OMC) - as significant price discovery contracts (SPDC) under §2(h)(7) of the Commodity Exchange Act (CEA).  (Two other daily ICE contracts traded at Mid-C - Mid-C Financial Peak Daily and Mid-C Financial Off-Peak Daily - were not so designated.)  SPDC designation subjects the contracts to heightened regulatory oversight and reporting requirements. (more…)

In connection with the completion of the 2010-2011 budget for the Commonwealth of Pennsylvania, the General Assembly has expressed its intention to pass legislation imposing a severance tax on the extraction of natural gas. The structure and rate of the tax remains uncertain, but it is expected that Pennsylvania law makers will negotiate the scope and magnitude of the tax in the coming months. (more…)

The Federal Energy Regulatory Commission (FERC) on June 17 proposed a rulemaking that, if implemented, has the potential to complete the opening of the transmission grid, an undertaking that began fourteen years ago. Earlier reforms, starting with FERC’s Order No. 888 in 1996, offered for the first time non-discriminatory open access to those who sought to interconnect with and use the grid.  In 2007 Order No. 890 expanded customer participation in the planning and operation of the grid. The new rule proposes to allow all power industry participants to contribute equally to the future design, configuration, and even ownership of the grid.  Public comments on the proposed rulemaking must be submitted to the agency by August, 30, 2010. (more…)