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Enron Mail |
for Order Shortening Time
Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: quoted-printable X-From: Steffes, James D. </O=ENRON/OU=NA/CN=RECIPIENTS/CN=JSTEFFE< X-To: Dasovich, Jeff </O=ENRON/OU=NA/CN=RECIPIENTS/CN=Jdasovic<, Kingerski, Harry </O=ENRON/OU=NA/CN=RECIPIENTS/CN=Hkingers<, Mara, Susan </O=ENRON/OU=NA/CN=RECIPIENTS/CN=Smara< X-cc: X-bcc: X-Folder: \JSTEFFE (Non-Privileged)\Steffes, James D.\Sent Items X-Origin: Steffes-J X-FileName: JSTEFFE (Non-Privileged).pst Harry -- Can you please review and provide input on comments? Especially a= s it relates to keeping open the San Diego market. =20 Jim -----Original Message----- From: Dasovich, Jeff=20 Sent: Monday, August 27, 2001 9:41 AM To: Kingerski, Harry; Steffes, James D.; Mara, Susan Subject: FW: IMPORTANT ! : Motion of San Diego Gas & Electric Company (U 90= 2-E) for Adoption of an Electric Procurement Cost Recovery Mechanism and fo= r Order Shortening Time FYI. We should discuss. =20 Best, Jeff -----Original Message----- From: Dan Douglass [mailto:douglass@energyattorney.com] Sent: Saturday, August 25, 2001 2:14 PM To: Vicki Sandler; Tamara Johnson; Mara, Susan; Steve Huhman; Roger Pelote;= Rob Nichol; Randy Hickok; Nam Nguyen; Jim Crossen; Dasovich, Jeff; Janie M= ollon; Jack Pigott; Greg Blue; George Vaughn; Gary Ackerman; Ed Cazalet; De= nice Cazalet Purdum; Curtis Kebler; Curt Hatton; Corby Gardiner; Charles Mi= essner; Carolyn Baker; Bill Ross; Karen Shea; Max Bulk Subject: IMPORTANT ! : Motion of San Diego Gas & Electric Company (U 902-E)= for Adoption of an Electric Procurement Cost Recovery Mechanism and for Or= der Shortening Time Yesterday, SDG&E filed a motion for adoption of an electric procurement cos= t recovery mechanism and for an order shortening time for parties to file c= omments on the mechanism. The attached email from SDG&E contains the motio= n, an executive summary, and a detailed summary of their proposals and rec= ommendations governing procurement of the net short energy requirements for= SDG&E's customers. The utility requests a 15-day comment period, which me= ans comments would have to be filed by September 10 (September 8 is a Satur= day). Reply comments would be filed 10 days later. The filing provides the following discussion of direct access: _____ =20 "Developing the net short requirements of consumers depends on the extent t= o which they might be served instead by third party providers. The level of= direct access will affect these net short requirements. At present, there = is substantial uncertainty concerning the future disposition of direct acce= ss and third party supply of retail customers that jeopardizes creation of = an optimal plan. This uncertainty has the potential for increasing costs to= San Diego retail customers as a result of unnecessary over- or under commi= tments. To resolve this uncertainty, the Commission needs to coordinate dir= ect access with resource planning, at least on an interim basis. SDG&E disc= usses below how to provide for this coordination.=20 As the retail market matures, SDG&E expects that direct access elections wi= ll gain stability and will not be characterized by severe volatility. That = stability will allow planners to make reasoned assumptions on direct access= and rely on them in developing a procurement plan. However, today, direct = access is subject to substantial uncertainty. Before the high prices of the= summer of 2000, approximately 20% of SDG&E's retail load had elected direc= t access. By the beginning of 2001, direct access had reduced by nearly hal= f. More recently, SDG&E has seen an increase in direct access, perhaps as a= result of two factors: first, would direct access customers be able to avo= id paying a share of CDWR contract costs, and second, would the state suspe= nd direct access, as appears to be permitted under ABx-1 1. Furthermore, th= e legislature is considering legislation that would permit direct access, a= nd other bills that would encourage municipal aggregation of load. The effe= ct of this latter bill is similar to direct access, but it could cause larg= e quantities of load to leave or return to the system quite abruptly.=20 These events illustrate the need for added coordination between direct acce= ss and resource planning. The necessary coordination could come by using an= open enrollment period each planning cycle under which direct access elect= ions take place. During that enrollment period, the utility is provided inf= ormation on the amount of load electing direct access (or municipal aggrega= tion) and the length of the direct access commitment. This open enrollment = period would last for 90 days and commence 180 days before SDG&E is schedul= ed to submit its procurement plan. Customers over 20kW would make commitmen= ts to service by suppliers other than SDG&E of at least 5 years. Smaller cu= stomers would make minimum one year commitments. These commitments and the = use of a specific enrollment period would provide SDG&E with the informatio= n it needs to plan to meet net short requirements and minimize the risk of = over- or under-commitment.=20 In order to ensure an orderly process that protects consumers, change of se= rvice would not occur until the commission ruled on the procurement plan, a= nd, to the extent that the commission determined that excessive direct acce= ss placed an unreasonable burden on utility customers, it could choose to l= imit direct access. Those electing to leave utility procurement would pay a= n exit fee to cover the costs of commitments made by CDWR and utility retai= ned generation committed to those customers in order to protect remaining c= ustomers. As a result of this change, SDG&E would not plan to provide commo= dity service to departing customers. Customers returning from direct access= prematurely would be subject to a re-entry fee and to spot energy pricing,= again to protect those customers who did not elect to switch. =20 Coordinating direct access with the planning process, at least for a near-t= erm period, is important to ensuring a reasonable procurement plan." _____ =20 The filing also briefly discusses competitive default supplier role: _____ =20 "When the State embarked on industry restructuring, one purpose was to take= advantage of the benefits that competitive markets can provide. Although C= alifornia's experience with markets has not been as anticipated, it is stil= l possible that a disciplined application of the market with adequate regul= atory oversight can offer advantages to consumers. In fact, some states hav= e undertaken to use the competitive market to meet customers' net short req= uirements. For example, in parts of Pennsylvania, the State decided to auct= ion off a piece of the procurement obligation to the competitive market. Ca= lifornia may decide that it wants to do the same type of thing. If a portio= n of the net short is auctioned off in this manner, from a planning standpo= int, it should be treated the same as direct access: SDG&E will need adequa= te notice and information to facilitate its planning for any net short posi= tion remaining to be served, and the same use of exit fees and re-entry fee= s should also apply." _____ =20 There are a number of issues here which I think WPTF may want to comment up= on, as we have dealt with many of these issues in previous filings. Please= let me (and others) know if you agree. =20 Dan Law Offices of Daniel W. Douglass 5959 Topanga Canyon Blvd. Suite 244 Woodland Hills, CA 91367 Tel: (818) 596-2201 Fax: (818) 346-6502 douglass@energyattorney.com ----- Original Message -----=20 From: Evans, Darleen <mailto:DEvans@sempra.com<=20 =20 Sent: Friday, August 24, 2001 4:49 PM Subject: Motion of San Diego Gas & Electric Company (U 902-E) for Adoption = of an Electric Procurement Cost Recovery Mechanism and for Order Shortening= Time <<A.01-01-044 Procurement Plan(v1).DOC<< <<A.01-01-044 Exc. Summary(v1).DOC= << <<A.01-01-044 Motion(v1).DOC<<=20 _________________________________ Darleen Evans Sempra Energy - Law Department 619-699-5056 devans@sempra.com <mailto:devans@sempra.com<
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