The Maine Public Utilities Commission (MPUC) is responsible for adopting and implementing the following:
1. Rules for competitive billing and metering and determining each transmission and distribution utilities’ costs for billing and metering to establish separate charges.
2. Rules for revoking licenses.
3. Rules requiring standard billing information on bills.
4. Rules establishing standards of conduct for distribution utilities and affiliated competitive providers.
5. Rules establishing a program allowing retail customers to make voluntary contributions to fund renewable resource research and development.
6. Rules encouraging and establishing funding levels and system capacity charges for conservation programs.
7. Rule establishing terms and conditions for standard offer services. 8. Rules establishing unbundled bill requirements.
9. Rules to implement a consumer education program.
10. Rules to collect a system benefits charge for transitional service and benefits for eligible utility employees.
Enforcement
The MPUC is responsible for licensing competitive electric providers and establishing rules for revoking licenses. The MPUC will intervene and participate in the proceedings of any federal agency whenever the interests of competition, consumers of electricity or economic development in Maine are affected.
Consumer Protection
The MPUC will adopt rules for consumer protection standards to protect retail customers from fraud and unfair practices. The MPUC has the authority to impose penalties for violating consumer protection rules and resolve customer disputes and to issue cease and desist orders and order restitution for any party injured for a consumer protection violation.
Rate Regulation
transmission and distribution utilities’ revenue requirements and costs for billing and metering to establish separate charges. Separate hearings will be conducted to determine the amount of stranded cost and appropriate charge for each utility. The MPUC will set rates in periodic rate cases of T&D utilities and receive funds for low income assistance programs.
FOLLOW-UP
The Maine restructuring legislation requires that on December 31st of each calendar year, the commission must submit to the joint standing committee of the Legislature having jurisdiction over utility matters a report describing the Commission's activities in carrying out the requirements of the restructuring legislation and the activities relating to changes in the regulation of electric utilities in other states.
In its report, the Commission must provide an accounting of the Commission's actual and estimated future costs of enforcing and implementing the provisions of the legislation governing the relationship between a transmission and distribution utility and an affiliated competitive electricity provider and the costs incurred by transmission and distribution utilities in complying with those provisions. The Commission must also provide an assessment of the effects of imposing these costs on ratepayers and the potential effects of assessing transmission and distribution utilities for these costs and prohibiting the costs from being passed through to ratepayers.
If the Commission determines, after providing interested parties an opportunity to be heard, that any provision in the present legislation is not in the public interest, the Commission should present a report to the joint standing committee of the Legislature having jurisdiction over utility matters stating the basis for the Commission's conclusion and including draft legislation designed to modify the chapter consistent with the public interest.
In addition, the commission will monitor events in the region pertaining to:
1. The development of an independent system operator with responsibility for transmission reliability;
2. The management of competitive access to the regional transmission system; and 3. Rights to negotiate potential contracts between sellers and buyers of electricity.
If the Commission determines that there exists insufficient independence on the part of the independent system operator from any provider of wholesale transmission, competitive electricity provider or electric utility, or if it determines any other problem threatens regional transmission reliability, the Commission will provide a report to the joint standing committee of the Legislature having jurisdiction over utility matters with a recommendation as to what actions within the authority of the State are available to remedy this problem.
RESTRUCTURING AUTHORITY Law
In 1999, the Maryland Legislature signed the Electric Customer Choice and Competition Act of 1999 (SB 300/HB 703). On September 8, 1999, the PSC passed Order No. 75680 which established a restructuring plan. Settlement agreements have been reached with 3 investor-owned electric utilities by the end of 1999. Potomac Edison Co. (Allegheny Power) has not reached a settlement agreement.
Applicability
Only the generation component of a customer’s bill is being deregulated. MARKET STRUCTURE
Affected Customers
Customers of investor-owned utilities will have choice by July 1, 2002. Nearly all Maryland residents will have choice by 2003.
Dates
Last year Mid-Atlantic Power Supply Association (MAPSA), an association of retail marketers, filed a petition in Baltimore Circuit Court asserting that the Maryland PSC incorrectly approved too much in stranded cost recovery for Baltimore Gas & Electric and that the amount reduced shopping credits to a point where customers would be reluctant to leave their incumbent utility. In May, the Circuit Court had affirmed the PSC's ruling that MAPSA lacked legal standing to dispute the restructuring order because it could not prove it had been harmed. However, on July 20, 2000, the appeals court disagreed with the lower court's ruling finding that MAPSA did have standing to challenge the settlement, lifted its stay to the start of competition, and remanded the case back to the circuit court for a decision on the merits. The next day, the Circuit Court reinstated the stay for two weeks, again suspending the start of competition, and scheduled a hearing for August 4, 2000.
We will continue to follow this case and report substantive developments MARKET POWER
Divestiture of Assets
The Commission may not require an electric company to divest itself of a generation asset nor prohibit an electric company from divesting itself voluntarily of a generation asset.
Sale
According to the settlement agreements, Delmarva (DPL) will sell 2,200 MW of nuclear and coal-fired generating capacity to third parties. Unsold assets will be transferred to an unregulated affiliate. Baltimore Gas and Electric (BGE) will sell all its generation assets.
Functional Unbundling
The Commission requires that customers' bills for electricity service indicate charges for 1) distribution and transmission, 2) transition charge or credit, 3) universal service program charges, 4) customer charges, 5) taxes, and 6) other charges identified by the Commission.
Rate reductions
The PSC will reduce residential electric base rates between 3% and 7.5%. For Delmarva, 7.5% rate reduction will apply for the residential rate class only, effective July 1, 2000, and have a four-year rate freeze. BGE will cut rates to an average of 6.5%, effective July 1, 2000, and have a six-year rate freeze. PEPCO will cut rates by approximately 7% for residential customers and 4% for nonresidential customers. These rate reductions will be apportioned between the unbundled supply rate and unbundled wires rate.
STRANDED COSTS Definition
The Electric Customer Choice and Competition Act of 1999 from the legislature establishes the subsequent PSC Orders creating a restructuring plan. Order 75680 (Filed October 8, 1999) restructures the Maryland electric industry and deals with stranded costs.
Calculation and Recovery
The appropriate rate for the recovery of stranded costs will be determined in Phase II on unbundled rates. (p. 28, Order 75680). The period of recovery will be during the rate freeze period beginning 7/1/00 for 4 years (6/30/04). The PSC determined $8 million in stranded costs for Delmarva. Delmarva has $8 million allocated to non-residential ratepayers only.
CUSTOMER SERVICE ISSUES
Standard Service Provisions and Policies
Beginning on the initial implementation date, an electric company's obligation to provide electricity supply and electricity supply service is stated by this subsection. Electricity supply purchased from a customer's electric company is known as standard offer service. A customer is considered to have chosen the standard offer service if the customer: is not allowed to choose an electricity supplier under the phase in of customer choice in subsection of this section, contracts for electricity with an electricity supplier and it is not delivered, cannot arrange for electricity from an electricity supplier, does not choose an electricity supplier, chooses the standard offer service, or has been denied service or referred to the standard offer service by an electricity supplier.
Any obligation of an electric company to provide standard offer service shall cease on July 1, 2003 except that electric cooperatives and municipal electric utilities may choose to continue providing standard offer service in their respective distribution territories, and may cease offering that service after notifying the Commission at least 12 months in advance.
Customer Education Campaigns
PEPCO began a consumer education program in December, 1999, notifying consumers of the option to shop for power beginning in the spring of 2000.
The Commission shall order each electric company, in conjunction with the Commission, the office of people's counsel, and other parties, to implement a consumer education program informing customers of changes in the electric industry.
Competitive Metering and Billing
Competitive metering for large customers shall begin on January 1, 2002, and competitive metering for all other customers shall begin on April 1, 2002, or earlier if requested by the electric company.
Slamming and cramming
The Commission shall adopt regulations or issue orders to: 1) protect consumers, electric companies, and electricity suppliers from anticompetitive and abusive practices, 2) require each electricity supplier to provide, adequate and accurate customer information to enable customers to make informed choices regarding the purchase of any electricity services offered by the electricity supplier, 3) establish reasonable restrictions on telemarketing, and 4) establish procedures for contracting with customers.
An electricity supplier or any person or governmental unit may not, without first obtaining the customer's permission, make any change in the electricity supplier for a customer or add a new charge for a new or existing service or option.
Deceptive practices
An electricity supplier may not engage in marketing, advertising, or trade practices that are unfair, false, misleading, or deceptive.
Customer Complaint/Redress
On or before July 1, 2000, the commission shall require appropriate complaint and enforcement procedures and establish procedures for dispute resolution.
Product Disclosure
The Commission requires that customers' bills for electricity service indicate charges for distribution and transmission, transition charge or credit, universal service program charges, customer charges, taxes, and other charges identified by the Commission.
Universal Service
The Commission shall establish a universal service program to assist electric customers with annual incomes at or below 150% of the federal poverty level. The Department of Human Resources shall be responsible for administering the universal service program through the Maryland Energy Assistance Program. The Department of Human Resources may, with input from a panel or roundtable of interested parties, contract with a for-profit or a nonprofit Maryland corporation existing as of July 1, 1999 to assist in administering the universal service program. The Commission shall have oversight responsibility for the universal service program. The components of the universal service program shall include bill assistance, at a minimum of 50% of the determined need. The components of the universal service program include low income weatherization, and the retirement of arrearage that were incurred prior to the initial implementation date.
PUBLIC PURPOSE PROGRAMS