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<title>August 2003: Ohio PUC Authorizes Issuance of RFP For Propsed Market-Based
Standard Service Offer</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>
August 2003</u><font size="6"><br>
Ohio PUC Authorizes Issuance of
RFP For Proposed Market-Based Standard Service Offer<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>3/09/26)</font></p>
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<p align="left"><span style="font-family:Arial">In a recently released order, the Public
Utilities Commission of Ohio (the "Commission") stopped short of approving
Monongahela Power Company’s (the "Company") application to modify its
generation rates to provide for a market-based standard service offer ("ISSO").
Case No. 03-1104-EL-ATA, Finding and Order, issued July 24, 2003. Instead,
the Commission authorized the Company to take the first step toward
implementation of its plan—issuance of a request for proposal ("RFP")—and
withheld a final decision on the Company’s application until responses to
the RFP are known and evaluated.</span></p>
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<p align="left"><span style="font-family:Arial">Ohio law requires electric distribution
utilities ("EDU"), like the Company, to provide customers with "a
market-based SSO" after its "market development period." ORC � 4928.14.
After the market development period, any customer who is not receiving
service from a certified retail electric service automatically defaults to
the EDU’s SSO. Id. The Company’s market development period concludes at the
end of calendar year 2003 with respect to large commercial and industrial
customers and street lighting. Its market development period concludes at
the end of calendar year 2005 with respect to residential customers and
small commercial and industrial customers. The plan set forth in the
Company’s application is its proposed method of complying with the
requirement for a market-based SSO. </span></p>
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<p align="left"><span style="font-family:Arial">The Company proposes to establish two
separate alternative market-based SSOs from which its customers could
choose. One alternative is a variable rate SSO under which the Company will
procure services on the spot market through the Pennsylvania-New
Jersey-Maryland Interconnection, LLC. The other alternative is a fixed rate
SSO under which the Company will procure services through a competitive
wholesale bidding process. Under the Company’s plan, a customer who defaults
to SSO service without choosing between the two market-based SSO options
would default to the fixed rate SSO. </span></p>
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<p align="left"><span style="font-family:Arial">The fixed rate SSO wholesale bidding
process would begin with a solicitation for wholesale suppliers to bid a
fixed price to supply "full requirements service" for a stated percentage of
the Company’s retail load for specific customer classes for one year. Once
under contract, the wholesale suppliers would be responsible to provide full
requirements service for the agreed percentage of retail load at the fixed
price regardless of "any changes in customers’ demand for any reason."
According to the application, "full requirements wholesale supply service"
includes "energy, capacity, [and] ancillary services and losses," but
excludes "network integration transmission service."</span></p>
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<p align="left"><span style="font-family:Arial">In the application, the Company indicates
that it has proposed a similar process in Maryland and argues that
establishing uniform procedures across each of the states it serves would be
more cost-effective for its customers.</span></p>
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<p align="left"><span style="font-family:Arial">The Commission decided to authorize
issuance of the RFP without rendering a decision on the application. The
Commission explained in its order that "the results of the RFP are necessary
to determine if [the Company’s] application is reasonable," and "the nature
and number of the responses to the RFP will serve to help assess the status
of the applicable wholesale market."</span></p>
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<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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