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<title>January 2003: January 2003: Illinois Competitive Service Declaration
Takes Effect by Operation of Law</title>
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<p align="left"><strong><small><font face="Arial">About The Author:</font></small></strong></p>
<p align="left"><font face="Arial" style="font-size: 9pt">Robert A. Olson is a partner in the law firm of
Brown, Olson & Gould, P.C. which maintains a nationwide practice in energy law,
public utility law and related commercial transactions.</font></p>
<p><small><font face="Arial"><font style="font-size: 9pt">He can be reached at:</font><br>
<br>
<b><font color="#0000FF">Brown, Olson & Gould, PC</font></b><br>
2 Delta Drive<br>
Suite 301<br>
Concord, NH 03301<br>
<a href="mailto:[email protected]">[email protected]</a><br>
(603) 225-9716<br>
<a href="mailto:[email protected]"></a></font></small></p>
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</center><p align="left"><b><u><br>
January 2003<br>
</u><font size="6">Illinois Competitive Service Declaration Takes Effect
by Operation of Law<br>
</font></b><strong>by Robert Olson -- Brown, Olson and Wilson, P.C.<br>
</strong><font face="Arial" size="2">(<em>originally published by PMA OnLine Magazine:
200</em>3/06/14)</font></p><center>
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<p ALIGN="JUSTIFY">The Illinois Commerce Commission (the "ICC") declined to approve or deny,
within applicable time limits, Commonwealth Edison Company’s ("ComEd")
petition for a declaration that the tariffed provision of electric service
to the 3MW or greater customer segment (the "Service") is now a "competitive
service" under Section 16-113 of the Illinois Public Utilities Act (20 ILCS
5/16-113). See Petition for Declaration of Competitive Service, No. 02-0479
(ICC November 14, 2002) (interim order). As a result, the Service has been
declared competitive by operation of law, subject to the possibility of a
subsequent ICC determination that the Service is not competitive. The effect
of the declaration is that customers currently receiving the Service at
rates prescribed by tariff may continue to take Service at those rates for
three years measured from June 2003, but new customers and existing
customers who are not presently subject to the applicable tariff, will not
be eligible for service under the prescribed rates after June 2003. </p>
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<p ALIGN="JUSTIFY"></p>
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<p ALIGN="JUSTIFY">Section 16-113 of the Act is part of Illinois’ statutory
scheme to transition to a competitive energy market. It permits an electric
utility to petition the ICC for a declaration that a tariffed service
provided by the utility is a competitive service. Following such a
declaration, Section 16-113 generally entitles a customer who is taking the
tariffed service to continue to receive the service from the utility on a
tariffed basis for three years. The ICC is to declare a service to be
competitive as to an "identifiable customer segment or group of customers,
or some clearly defined geographical area" within the utility’s service
area, "if the service or a reasonably equivalent substitute service is
reasonably available . . . at a comparable price from one or more providers"
other than the utility or an affiliate of the utility, and the utility "has
lost or there is a reasonable likelihood that the electric utility will lose
business for the service to the other provider or providers." In making its
determination, the ICC must also consider whether there is "adequate
transmission capacity" to make electric service available from the other
provider or providers. </p>
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<p ALIGN="JUSTIFY"></p>
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<p ALIGN="JUSTIFY">In its interim order on ComEd’s petition, the ICC
generally found that ComEd had satisfied the statutory criteria and stated
that competitive conditions "exist in considerable degree." The ICC
acknowledged, however, that "current competitive conditions may be tenuous,"
and in recognition of the arguments of numerous intervenors concerning the
possibility of a future decrease in competition, the ICC declined to
affirmatively grant ComEd’s petition, and instead allowed the competitive
service declaration to take effect by operation of law. Under Section 16-113
of the Act, a competitive service declaration is deemed granted if the ICC
fails to act within 120 days of the filing of the petition, provided that
the ICC is not precluded from making a contrary determination in a
subsequent determination. In its interim order on ComEd’s petition, the ICC
initiated a proceeding to monitor the development of the marketplace for the
affected customer segment to form the basis for a possible future ICC
declaration that the Service either is or is not competitive. Section 16-113
does not prescribe a time limit within which any such subsequent
determination must be made. If the ICC were to declare that the Service is
not competitive, Section 16-113 would permit ComEd to file another petition
six (6) months later.</p>
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<blockquote>
<p align="left"><font face="Arial">
<small>Robert A. Olson is a partner in the law firm of Brown, Olson &
Gould P.C.
which maintains a nationwide practice in energy law, public utility law and related
commercial transactions. He can be reached at:</small></font><p align="center">
<font face="Arial"><small><font color="#0000FF"><b>Brown, Olson & Gould, PC</b></font><br>
2 Delta Drive, Suite 301<br>
Concord, NH 03301 <br>
<br>
<a href="mailto:[email protected]">[email protected]</a> | (603) 225-9716<a href="mailto:[email protected]"></a></small></font>
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