FirstEnergy's Pennsylvania Default Service Program

Frequently Asked Questions

General

GEN 00001
Published On: 10/18/2012

Question: Is the Legal Representative (designated in Section 1.4 of the Part 1 Application) responsible only for the receipt and forwarding of legal process? Are there any other duties that must be performed? Is the Legal Representative responsible in any way for the Applicant’s activities? Can a corporation be designated as the Legal Representative, as opposed to an individual?

Answer: The responsibility of the Legal Representative from the perspective of the FE-PA Companies is to accept service of process on behalf of the Applicant.  This designation is required so that the Companies may appropriately direct any legal communications.  Designation as an Applicant's Legal Representative is not intended to create a responsibility in any individual for the Applicant's activities where that responsibility would not otherwise exist.  An individual must be designated, not merely a corporation.

GEN 00003 (revised 07/07/2014)
Published On: 11/01/2012

Question: Does MW/tranche multiplied by # of tranches represent the total MW (estimated) to be procured?

Answer: A tranche represents a fixed percentage of a company’s class load. Forecasted company peak loads were used to set the number of tranches, and the resulting tranche size percentages.  The MW/tranche size is an estimate. The number of tranches will stay constant during the delivery period regardless of the actual peak or hourly load data. Suppliers are responsible for serving the actual load, which reflects various factors including but not limited to time of year and day, weather, and customer shopping migration.

GEN 00004 (revised 10/10/2014)
Published On: 11/07/2012

Question: If applying the load cap to the total number of tranches to be procured in a given auction across all products results in a fraction, will the load cap be rounded down to the nearest integer?

Answer: If application of the load cap would result in fractional tranches, then rounding down to the nearest integer tranche is used. Note that the load cap is applied in each auction. For example, if there are 72 tranches being procured in the Residential/Commercial (Fixed-Price or FP) auction, a load cap of 50% means no bidder will be allowed to bid on more than 36 tranches in that auction. If there are 37 tranches being procured in the Industrial (Hourly-Priced or HP) auction, applying a 50% load cap results in 18.5 tranches, and rounding down to the nearest integer tranche means no bidder will be allowed to bid on more than 18 tranches in that auction.

GEN 00006 (revised 11/06/2014)
Published On: 11/07/2012

Question: Is it anticipated that the auction will start and close on the same day?

Answer: There is no set time-frame for how long any particular auction will take.  Generally, however, most Pennsylvania auctions are concluded in a single day.

GEN 00007 (revised 11/06/2014)
Published On: 11/14/2012

Question: For the Part 1 Application, are hardcopies required for all of the supporting documents (i.e., PJM and financial documents)?

Answer: Hardcopies of Part 1 and Part 2 Application documents are not required, electronic versions are sufficient. Hardcopies are required for Letters of Credit only.

GEN 00008 (revised 11/06/2014)
Published On: 11/14/2012

Question: We do not have a legal counsel that resides in Pennsylvania, and all legal documents are handled by our headquarters in another state. Will this be acceptable?

Answer: No.  All bidders are required to provide the name of a legal contact that has an address within the Commonwealth of Pennsylvania.

GEN 00009 (revised 11/06/2014)
Published On: 11/15/2012

Question: In FAQ GEN 00001, it is stated that for the Legal Representative, “An individual must be designated, not merely a corporation.” We utilize a large Service of Process agent and they have told us that they cannot name a specific individual, and that naming an individual applies only to individuals who act as the registered agent. This would not apply to a service company which acts as a corporate registered agent. In addition, service of process is valid only if received by mail, certified mail, FedEx, or process server. We do not accept process via fax or email. To clarify that, the State statutes and administrative rules mandate how service can be accepted.

Answer: All bidders are required to provide the name of an individual to be designated as their legal contact. Please also see GEN 00008.

GEN 00010 (revised 10/10/2014)
Published On: 11/20/2012

Question: What are the consequences of any one or all of the EDCs being downgraded below investment grade or not being rated by any rating agency?

Answer: The Supplier Master Agreement (SMA) does not address the possibility of a downgrade of an EDC.  Each supplier should make its own determinations of the likelihood and effect, if any, of such an occurrence.

GEN 00012
Published On: 12/07/2012

Question: Regarding Section 1.6 of the Part 1 Application, what documents count as documentation that our company has PJM E-Accounts set up and that we are a registered PJM LSE?

Answer: As proof of having a PJM E-Account, we accept screenshots of your logged-in E-Account or a Customer Account Manager Designation Form. Proof of being a registered Load Serving Entity (LSE) in PJM can be a fully executed PJM Application for Membership, a copy of the Operating Agreement of PJM showing your company name listed in the PJM Member List in that Agreement, or a screenshot from the PJM Website listing its members and showing the name of your company.

GEN 00013 (revised 11/06/2014)
Published On: 12/07/2012

Question: Please explain the differing renewable requirements for West Penn Power versus the three other EDCs. Please explain in detail how the AECs for West Penn Power are allocated.

Answer: The obligations of Default Service Suppliers to provide Alternative Energy Credits (AECs) vary among the Companies. Each supplier to Met-Ed, Penelec and Penn Power must provide non-solar Tier I and Tier II AECs to meet the requirements of the Alternative Energy Portfolio Standards Act (AEPS) for the load it serves, but those Companies will satisfy all Tier I solar AEPS requirements associated with their Default Service load using solar AECs obtained through separate procurements. Each supplier to West Penn Power will be required to provide all Tier I (including solar) and Tier II AECs associated with AEPS requirements for the default service load served by the supplier, less a specified number of Tier I solar AECs and Tier I non-solar AECs obtained by West Penn Power under separate long-term contracts. West Penn Power will allocate a defined number of Tier I solar and Tier I non-solar AECs for each tranche of load served that will be applied to reduce each supplier’s AEPS obligations. The obligation provisions resulted from the Commission Order at Dockets No. P-2013-2391368, P-2013-2391372, P-2013-2391375, P-2013-2391378. Please also see GEN 00014.

GEN 00014 (revised 09/21/2016)
Published On: 12/07/2012

Question: For West Penn Power, what portion of the 1,000 Solar and 75,000 Tier I Alternative Energy Credits (AECs) will be allocated to Default Service Suppliers for this procurement?

Answer: FAQ GEN 00013 explains the allocation of AECs for West Penn Power. The table below provides more details on how 1,000 Solar Photovoltaic Alternative Energy Credits (SPAECs) and 75,000 Tier I AECs per year are allocated to Default Service Suppliers by customer class:

DSP-III Residential Commercial Industrial Total
Percentage 36% 24% 40% 100.0%
Tranches per Class 28 18 13
SPAECs/Tranche 14 12 30
Tier I AECs /Tranche 968
1012
2,283
Total Allocated SPAECS 392 216 390 998
Total Allocated Tier I 27,104 18,216 29,679 74,999

DSP-IV Residential Commercial Industrial Total
Percentage 33% 25% 42% 100.0%
Tranches per Class 28 19 13
SPAECs/Tranche 10 12 37
Tier I AECs /Tranche 880
968
2,459
Total Allocated SPAECS 280 228 481 989
Total Allocated Tier I 24,640 18,392 31,967 74,999

GEN 00016 (revised 09/21/2016)
Published On: 12/13/2012

Question: Please list the items that are excluded from the Default Service Suppliers’ full requirements obligation.

Answer: The full requirements obligations of Default Service Suppliers exclude the following items:

  • Regional Transmission Expansion Plan charges ("RTEP");
  • PJM Expansion Cost Recovery Charges ("ECRC");
  • Reliability Must Run / Generation Deactivation charges ("RMR") associated with generating plants for which specific RMR charges begin after the approval of the Companies' DSP-III Default Service Plans   by the Commission. All Suppliers will continue to be responsible for RMR charges associated with generating plants that began before the approval of DSP-III by the Commission, as those charges may change over time; 
  • Unaccounted for Energy; and
  • Historical out of market tie line, generation and retail customer meter adjustments.

A listing of PJM billing line items, and the responsible party for each under the Default Service Supply Master Agreement, can be found in Appendix D of the Supplier Master Agreement (SMA).

GEN 00017
Published On: 12/13/2012

Question: In the Part 2 Application, the indicative offer includes the number of tranches and does not include indicative offer prices, is that correct?

Answer: Yes, that is correct.  Applicants do not specify prices in their indicative offers -- at the time indicative offers need to be provided by applicants, the prices already will have been specified as the minimum and maximum possible starting prices in the auction.  For each product, the indicative offer comprises two numbers: the first number is the maximum number of tranches the applicant is willing and able to bid on and serve at the minimum starting price for the product, and the second number is the maximum number of tranches the applicant is willing and able to bid on and serve at the maximum starting price for the product.

GEN 00018 (revised 10/10/2014)
Published On: 12/13/2012

Question: Will the pre-bid security be returned to the bidder in the event the bidder does not participate in the auction or is not awarded any tranches?

Answer: The pre-bid security will be returned to the bidder as explained in the Bidding Rules.

GEN 00019
Published On: 12/13/2012

Question: How frequently are the FAQs updated?

Answer: Some questions can be answered and posted as FAQs within 24 hours.  Other questions require more time to answer.  Questions are answered and FAQs are posted in as timely a manner as possible.

GEN 00021 (revised 09/21/2016)
Published On: 12/14/2012

Question: According to the Bidding Rules, the Residential load Default Service supplier will be paid a fixed price for 95% of the residential load and 5% of the residential load will be priced at Real Time LMP plus a $20/MWh adder. The Commercial load Default Service supplier will be paid 100% fixed price, and the Industrial load Default Service supplier will be paid the sum of 100% of the fixed price and 100% of the Real Time LMP plus a $4/MWh adder.  To confirm this, are the following calculations correct?  

Example: Assume auction price is $100/MWh for all customer classes, volume is 10 MW at a certain date/hour for all customer classes, and RT LMP for that date/hour is $50/MWh for all customer classes.

Residential DS supplier will be paid 0.95*100*10 + 0.05*(50+20)*10= $985

Commercial DS supplier will be paid 100*10=$1000

Industrial DS supplier will be paid 100*10 + (50+4)*10 = $1540.

Answer: That example is correct, except in DSP-III there is also a seasonal billing factor that is applied to the fixed price portion of the calculation for the Residential and Commercial products. There is no seasonal billing factor in DSP-IV auctions.

GEN 00022 (revised 09/22/2016)
Published On: 01/03/2013

Question: This inquiry is regarding smart meter installation/implementation. Did all the FirstEnergy utilities complete smart meter installation for all customers? If so, are you using smart meter information (no more profile) to allocate customer capacity/transmission peak? If not, what is the current status, and when do you expect to use smart meter information to allocate customer capacity/transmission peak?

Answer: No, the PA utilities have not completed smart meter installation for their customers. Deployment of smart meters will continue through mid-2019 for 98.5% of all customers per the Commission- approved smart meter deployment plan. The remaining 1.5% of the meters that may require alternative communication solutions or involve hard-to-access locations are expected to be installed by December 31, 2022, pursuant to the Joint Petition of Metropolitan Edison Company, Pennsylvania Electric Company, Pennsylvania Power Company, and West Penn Power Company For Approval of their Smart Meter Deployment Plan, Docket Nos., M-2013-2341993, M-2013-234199, M-2013-2341990, and M-2013-2341994 (Order entered June 25, 2014).

As of June 30, 2016, approximately 463,000 meters along with related infrastructure have been deployed based on the following Company breakdown:

Meters
Met-Ed 35,520
Penelec 157,140
Penn Power 171,750
West Penn Power 98,800
Total 463,210

The Companies anticipate the majority of Penn Power smart meters will be certified and operational before the end of the first quarter 2017. Smart meters in the remaining Companies’ service territories that were deployed throughout 2016 will commence with a certification process on a meter reading unit by meter reading unit (or route by route) basis over several months following first quarter 2017. After the first quarter of 2017, interval data will be accessible for those customers with smart meters.

GEN 00025 (revised 09/21/2016)
Published On: 01/08/2013

Question: If a successful Part 1 Application and Part 2 Application were submitted and approved for a prior auction under one of FirstEnergy’s Pennsylvania Default Service Programs (DSP), does a Part 1 Application need to be submitted for subsequent auctions under any DSP?

Answer: During the process leading up to an auction, we will inform Qualified Bidders from the most recent auction(s) whether a new Part 1 Application will be required for the upcoming auction.  As a general rule, prospective bidders will need to complete one new Part 1 Application per calendar year, unless the prospective bidder needs or wants to make changes to their Part 1 Application.  The Qualified Bidder still needs to complete a separate Part 2 Application for each auction.  In any case, a prospective bidder is obligated to inform the Independent Evaluator of any change in its status related to the information the prospective bidder previously provided in its Part 1 Application or its Part 2 Application. A new Part 1 Application is required of all prospective bidders for the first auction in a DSP series of auctions.

GEN 00027
Published On: 01/10/2013

Question: Do all customers in a given group (for example Met-Ed Residential Default Service customers) pay the same rate? If not, please provide the rate translation mechanism from all the auction clearing prices (inclusive of the floating LMP-based portion) to what different types of customers within a group would pay.

Answer: All customers within the Residential Class and the Commercial Class of each Company pay the same rate.  The Industrial Class customers on hourly rates pay the same rate for kWh's consumed in the same hour.

GEN 00031 (revised 01/18/2017)
Published On: 01/22/2013

Question: (1) Have any of the EDCs filed to adjust the Network Integration Transmission Service (NITS) rate? If so, what are the expected changes? (2) Do you expect any of the EDCs to file during the term of the products in the Default Service auctions (e.g., now through and until May 2015)? (3) If so, what are the expected changes? (4) When will Pennsylvania Power Company (Penn Power) update its formula rate? What variables are expected to change? What would be the expected impact to both the Bulk and Area NITS rate?

Answer: On October 31, 2014, PJM, on behalf of American Transmission System, Incorporated (“ATSI”), filed with the Federal Energy Regulatory Commission (“FERC”) a proposed update to ATSI’s formula rate with a requested effective date of 1/1/2015. FERC approved a settlement in this case on October 29, 2015. This affects Default Service and EGS LSEs serving load in Penn Power as of 1/1/2015 as well as potential bidders of future Penn Power Default Service Auctions. For more information, please see the filing and additional information posted on the FERC Website pertaining to Docket No. ER15-303-000. The ATSI NITS rate will be updated every January 1st per ATSI’s new formula rate.

Having received approval from the PA Commission to transfer the transmission assets of Met-Ed and Penelec to MAIT, a future filing proposing to revise NITS rates to formula style rates for the Met-Ed and Penelec zones is anticipated.

GEN 00034 (revised 09/21/2016)
Published On: 02/05/2013

Question: Can a winning bidder publicly disclose the number of tranches they won in an auction?

Answer: In both the DSP-III and DSP-IV Bidding Rules, Section 11.3.4, Limitations on Disclosures by Bidders, states:  "Bidders are not allowed to disclose they are participating in the Fixed-Price Auction or the Hourly-Priced Auction, and winning bidders are not allowed to disclose that they have won any tranches in the Fixed-Price Auction or the Hourly-Priced Auction until the Commission publicly reports the results of the auction. Such limitation on public disclosure by bidders is waived if disclosure is required by law."

GEN 00035
Published On: 11/26/2013

Question: Regarding section 1.4 of the Part 1 Application for Default Service products for Met-Ed, et al: does the applicant's legal representative in PA have to be an attorney or will the corporation's agent for service of process suffice?

Answer: An agent for service of process will suffice.  See also FAQ GEN 00001 and FAQ GEN 00009.

GEN 00036
Published On: 12/11/2013

Question: The Independent Evaluator and the Pennsylvania PUC publish the winning auction prices of prior auctions. Are the names of the winning suppliers made public?

Answer: The names of winning bidders are not made public.  As noted in FAQ GEN 00034, a winning supplier is free to disclose that they have won tranches in an auction but only after the Commission has publicly reported the results of the auction.

GEN 00039 (revised 01/18/2017)
Published On: 01/07/2014

Question: What is the percentage of interval-metered installations for various customer classes, say, Residential, Commercial, and Industrial for each of the EDCs (Met-Ed, Penelec, Penn Power, and West Penn Power)? Is there a plan to install more interval-meters within the EDCs' territories and if so what is the planned timeline for the installation?

Answer: Interval meters are currently installed on C&I customers with demands of 400 kW or greater.

Percent Customers with Interval Meters
  Res C&I
Met-Ed 0.00% 1.48%
Penelec 0.00% 1.57%
Penn Power 0.00% 1.29%
West Penn Power 0.00% 1.86%

 

The percentage of customers with interval meters stated above does not include any smart meters installed to date because the Companies are not currently collecting interval data from these meters. See GEN 00022 for the Smart Meter installation status.

GEN 00040 (revised 01/18/2017)
Published On: 01/10/2014

Question: What is the exact tranche size per EDC per customer class? For example, if for a particular Default Service auction there were 12 tranches of Met-Ed Residential load that totaled 43%. Would the calculation be 0.43/12 so that each tranche = 3.583% or would this 43% be a rounded number reflecting a total number of 28 tranches, so that the actual tranche size was 1/28, or 3.5714%? Please clarify.

Answer: The 12 tranches would represent approximately 43% rounded.  The actual size of each tranche would be 1/28, or 3.5714% (using four decimal places of precision here).

GEN 00042 (revised 09/21/2016)
Published On: 07/28/2014

Question: Have the documents changed at all for the upcoming Auction other than as referenced per the date noted at http://www.fepaauction.com/Documents/SupplierDocuments.aspx?

Answer: The documents on that Web page have been updated as of the date shown under “Updated On”.  The Part 1 Application and Part 2 Application on that Web page are updated as necessary to reflect the products that are being offered in the upcoming auction.

GEN 00043 (revised 09/21/2016)
Published On: 09/02/2014

Question: In the DSP-III process, are Default Service suppliers responsible for RMR charges and how are these charges different from DSP-II?

Answer: DSP-III and DSP-IV Default Service suppliers are not responsible for PJM charges associated with reliability must run (“RMR”) unit declarations and deactivation charges of plants for which charges are set after the approval of DSP-III by the Commission (July 24, 2014).  RMR unit declarations and deactivation charges of plants for which charges were set before July 24, 2014, and continue during the DSP-III and/or DSP-IV term, are the responsibility of the Default Service suppliers in the relevant DSP.  Please also see GEN 00016.

GEN 00044 (revised 11/06/2014)
Published On: 09/09/2014

Question: Will the FE-PA Utilities provide the awarded ARR paths (or nominated FTR paths) and values for PY14/15 that will be allocated to Default Service Suppliers?

Answer: The Default Service Suppliers independently participate in the PJM ARR/FTR auctions and are awarded ARRs and FTRs from the PJM auction into their individual PJM account.  The FE-PA Utilities do not have access to the awarded ARR paths or nominated FTR paths for any Default Service Supplier.

GEN 00045 (revised 12/03/2015)
Published On: 09/10/2014

Question: For the ARRs that are allocated to suppliers, what percent, if any, of the MWs are converted to FTRs?

Answer: Please refer to FAQ GEN 00044.  Also, note that when customers move among suppliers, PJM allocates ARRs among the suppliers in accordance with the PJM Tariff.  FTRs are not transferred from supplier to supplier.

GEN 00046 (revised 09/21/2016)
Published On: 09/11/2014

Question: If the Part 1 Application is submitted electronically, is it necessary to submit hardcopies of any part of the Part 1 Application and/or supporting documents?

Answer: Applicants are not required to submit hardcopies of any part of the Part 1 Application and/or supporting documents.

GEN 00048 (revised 09/21/2016)
Published On: 10/03/2014

Question: Is a Letter of Intent to Provide a Guaranty required for participation in DSP-III or DSP-IV Default Service Auctions?

Answer: In some cases for the prior DSP-II Default Service Auctions, a Letter of Intent to Provide a Guaranty was required.  However, for the DSP-III and DSP-IV Default Service Auctions there is no Additional Pre-Bid Security required, and therefore no need for a Letter of Intent to Provide a Guaranty.

GEN 00050 (revised 09/21/2016)
Published On: 10/23/2014

Question: Would you please make available a Word document version of the Form of Guaranty?

Answer: Rather than a Word version, a PDF version of the Form of Guaranty is available on the "Supplier Documents" page of the Information Website.  This version contains form fields that can be filled in electronically.

GEN 00052
Published On: 10/30/2014

Question: Could you provide the methodology for how the total APS zone capacity obligation is allocated between Allegheny Maryland (Potomac Edison) and West Penn Power?

Answer: Each state jurisdiction within the APS Zone is metered at the state line crossings.  This includes MonPower WVA, Potomac Edison WVA, Potomac Edison Maryland, ODEC VA, and West Penn Power PA.  The state jurisdiction loads at the time of the PJM five summer peaks are determined from the metered loads which sum to the APS Zone load at the time of the five PJM peaks.  A load ratio share is then determined based on each state jurisdiction average 5 CP compared to the total APS Zone average 5 CP.  This load ratio share is then applied to the PJM assigned capacity obligation for the APS Zone to determine each state's capacity obligation.

GEN 00055 (revised 09/21/2016)
Published On: 01/08/2015

Question: Appendix D of the Default Service Supplier Master Agreement distinguishes "Generation Deactivation and RMR Generating Unit Declarations" (billing line item 1930) before PaPUC Approval of the Company's Default Service Program as the responsibility of the DS Supplier (winning bidder) and after PaPUC Approval of the Company's Default Service Program as the responsibility of the EDC. Would you provide the date of the approval of the Company's Default Service program, as well as indicate where on PJM's Website information regarding the dates of Generation Deactivation and RMR Generating Unit Declarations can be found?

Answer: Current generation deactivation for reliability must run generating units can be found on the PJM Website at http://www.pjm.com/planning/generation-deactivation/gen-deactivation-rmr.aspx

GEN 00056
Published On: 01/08/2015

Question: For West Penn Power: (1) What is the on-going rate for the PJM charge of "Transmission Owner Scheduling, System Control and Dispatch Service"? (2) Which transmission owner is providing transmission service to West Penn Power?

Answer: (1) There is no "Transmission Owner Scheduling, System Control and Dispatch Service" charge for West Penn Power under Schedule 1A of the PJM OATT.   APS (West Penn, Monongohela Power, and Potomac Edison) waived these charges as part of their agreement to join PJM in 2002.  (2) West Penn Power Company d/b/a Allegheny Power is the transmission owner providing service to West Penn Power.

GEN 00058 (revised 01/18/2017)
Published On: 03/25/2015

Question: There are two rates - one for a 365-Day Year and one for a 366-Day Year. The NITS rate for FirstEnergy (Met-Ed and Penelec) is $15,112/MW-Year, so I see how the rates in $/MW-Day are arrived at. However, looking at Section 5.2 of Manual 27 for PJM, it mentions only dividing the Annual Zonal Network Integration Transmission Service Rate by 365. Given that 2016 is a leap year, will the rate be $41.289617/MWd or will the PJM rule apply and it will be $41.402740/MWd?

Answer: The Penelec and Met-Ed NITS rate for 2016 will be 41.289617, which is based on the 366 calendar days in a leap year.

GEN 00059 (revised 10/20/2017)
Published On: 05/11/2015

Question: The Allegheny (West Penn Power), Met-Ed, and Penelec NITS rates have not changed since before June 2012. Are there any plans for the operating companies to update their NITS rates in the foreseeable future?

Answer: Allegheny (West Penn Power) has not filed changes to its NITS rate. On July 21, 2016, Met-Ed and Penelec received approval from the PaPUC to transfer their transmission assets to Mid-Atlantic Interstate Transmission, LLC (MAIT). On October 28, 2016, a FERC filing was made by MAIT (Docket # ER17-211-000) that may impact the NITS rates in the Met-Ed and Penelec zones. If approved, the rates would change as follows:

NITS Rates Current NITS Rate Current NITS Rate
Effective Dates
Future NITS Rate Future NITS Rate
Effective Date
Allegheny Power Zone $15,396.00/MW/Year Since March 1, 2002
MAIT Rate for ME & PN Zones $15,112.00/MW/Year Since January 1, 1999 $22,612.39/MW/Year January 1, 2017

In addition, please see FAQ GEN 00085.

GEN 00060 (revised 01/18/2017)
Published On: 07/07/2015

Question: In reference to FAQ 00054, since the load data are at the generator level (including distribution and transmission losses), we would need the proper loss factors to account for AECs being charged at the retail meter level. Without the loss factors customers who are on Default Service will potentially be paying too much for this service. Based on that can you supply us with the proper loss factors or confirm the losses in Rider H of each location's tariff are the applicable distribution for these auctions?

Answer: The distribution loss factors provided in Rider H of each company's tariff are suitable to use for these auctions.  The transmission loss component would need to be added to these distribution loss factors to reflect the total loss included in the loads.  The transmission loss components are as follows: Met-Ed --- 0.021; Penelec --- 0.039; Penn Power --- 0.01486; and West Penn --- 0.02184.

GEN 00061 (revised 12/03/2015)
Published On: 07/21/2015

Question: Is there a definitive schedule set already for future auctions?

Answer: The Calendar page of the Information Website provides the latest information on upcoming auctions.

GEN 00062 (revised 12/03/2015)
Published On: 09/01/2015

Question: Can you please comment on how transfer of MET-ED & PENELEC transmission assets to Mid-Atlantic Interstate Transmission, LLC (MAIT), if approved, will affect any existing and future Default Service contracts?

Answer: As proposed in the filings made seeking approval of the transfer of assets, the transfer represents a change of control only and therefore is not expected to impact Default Service contracts.

GEN 00063 (revised 12/03/2015)
Published On: 11/10/2015

Question: How much notice must a customer who is currently taking Default Service give before they can switch to a retail provider for each rate schedule?

Answer: All Pennsylvania customers may select a supplier at any time whether currently taking Default Service or already shopping.  No notification is required for any customer rate type.  A supplier switch is made effective within three days after the utility receives notification from a customer's selected supplier.

GEN 00064 (revised 01/18/2017)
Published On: 04/21/2016

Question: Are there currently any plans for municipal aggregation in any of the First Energy Zones in Pennsylvania that will affect Default Service load for PJM planning year 2016-2017? If so, will households/businesses have to opt-in or opt-out? If so, is there a list of municipalities that have already decided to leave Default Service?

Answer: The Companies are not aware of any municipal aggregation activities in any of the First Energy Zones in Pennsylvania that will affect Default Service load for PJM planning years 2016–2017 and 2017-2018.

GEN 00065
Published On: 08/29/2016

Question: Will the DSP-III auction and the DSP-IV auction use the same auction Website?

Answer: The DSP-III auction and the DSP-IV auction use the same Bidding Website for the actual bidding process.  The Information Website also is the same for both auctions.  However, the Website used to submit Part 1 and Part 2 Applications is different between DSP-III and DSP-IV:  DSP-III has its own Website to submit Part 1 and Part 2 Applications, and DSP-IV has its own Website to submit Part 1 and Part 2 Applications.

GEN 00066 (revised 01/18/2017)
Published On: 08/30/2016

Question: I noticed that the DSP-III Auction Calendar and DSP-IV Auction Calendar on the Information Website state different %'s of Default Service (DS) Load supplied for the same number of tranches available. For example 4 tranches of Met-Ed Residential in DSP-III was equal to 16.0% of DS Load supplied, whereas 4 tranches of Met-Ed Residential in DSP-IV is equal to 16.7% of DS Load supplied. Could you confirm that the DSP-IV Auction calendar is accurate and could you please state how many tranches of each product in each zone will be procured over the course of the DSP-IV process?

Answer: In the auction schedules on the Information Website, "% of DS Load" is the number of tranches to be procured in a particular auction (for the given company, customer class, and delivery period -- also referred to as an auction "product"), divided by the total number of tranches to be procured across all the auctions and relevant contract periods for the product (company/class/period).

For Met-Ed Residential in DSP-III, during the Default Service delivery months of June 2015 through May 2017, each day and each hour there are 25 tranches of Default Service load (and therefore 25 tranches delivered by Default Service suppliers).  So 4 tranches being procured in an auction represent 16.0% of the 25 total tranches across multiple auctions and relevant contract periods for the product.

For Met-Ed Residential in DSP-IV, during the Default Service delivery months of June 2017 through May 2019, each day and each hour there will be 24 tranches of Default Service load (and therefore 24 tranches delivered by Default Service suppliers).  So 4 tranches being procured in an auction represent 16.7% of the 24 total tranches across multiple auctions and relevant contract periods for the product.

The total number of tranches to be procured for a product across all auctions is "# Tranches" divided by "% of DS Load" for that product (rounding that ratio to the nearest integer), which are both shown in the auction schedule.

GEN 00067
Published On: 09/14/2016

Question: Will the products in the October 2016 DSP-III auction be combined with the October 2016 DSP-IV auction resulting in a greater number of tranches available overall and therefore a larger load cap, or will they be treated separately?

Answer: The DSP-III auction and the DSP-IV auction are separate auctions.  Each of the two auctions will have its own products, tranche target, and load cap.  The mechanics of bidding in the two auctions will take place concurrently, using the same Bidding Website.  This is analogous to DSP auctions involving residential and commercial products (referred to as the fixed-price or FP auction) and industrial products (referred to as the hourly-priced or HP auction) -- the FP auction and HP auction are two separate auctions, although bidding takes place concurrently.

GEN 00068
Published On: 09/14/2016

Question: Do participants in previous DSP-III auctions in 2016 need to submit a new Part 1 Application to participate in the DSP-IV auction in October 2016?

Answer: All prospective bidders for the October 2016 DSP-IV auction must submit a new Part 1 Application for that DSP-IV auction.  It is the first DSP-IV auction of 2016.  The bidder application process for DSP-IV auctions is separate from the bidder application process for DSP-III auctions.  Qualified Bidders from DSP-III auctions in 2016 who would like to participate in the DSP-IV auction in October 2016 must submit a new Part 1 Application for that DSP-IV auction.

GEN 00069
Published On: 09/14/2016

Question: If there are changes to the NITs rates after the auction has cleared, will suppliers be made whole for any changes?

Answer: No.  As per the Supplier Master Agreement definition of Default Service Supply, or "DS Supply", on page 5, the suppliers are responsible for transmission services including NITS.  Any changes to the NITS rates are the responsibility of the Default Service Supplier.

GEN 00070 (revised 10/20/2017)
Published On: 09/27/2016

Question: With Met-Ed and Penelec joining Mid-Atlantic Interstate Transmission LLC, (MAIT), can you estimate the impact to the NITs rate?

Answer:

NITS Rates NITS Rate Effective Date NITS Rates
MAIT Rate for ME & PN Zones January 1, 2017 $22,612.39/MW/Year
Current ME & PN Zones January 1, 1999 - December 31, 2016 $15,112.00/MW/Year

On October 28, 2016, Met-Ed and Penelec filed forward-looking formula rates with the Federal Energy Regulatory Commission (FERC), Docket # ER17-211-000, to better support efforts to modernize the regional transmission grid and enhance service reliability for customers. The rates, if approved, would increase as reflected in the chart above.

In addition, please see FAQ GEN 00085.

GEN 00071 (revised 10/18/2016)
Published On: 10/05/2016

Question: In reference to FAQ GEN 00070, if MAIT does not have an estimate of the impact on NITs rates, can you give a directional impact? Can you at least provide some insight as to whether you expect NITs rates to go up or down with a new NITs rate filing? When Penn Power joined American Transmission System, Incorporated (“ATSI”), the rates went up. Do you expect the same to happen to Met-Ed and Penelec NITs rates?

Answer: Met-Ed and Penelec are not able to speculate on the direction or financial impact of any future NITS rate filings associated with the transfer of transmission assets to Mid-Atlantic Interstate Transmission LLC (MAIT).  Such information will be available after a filing is made at FERC.

GEN 00072
Published On: 10/12/2016

Question: Due to miscalculation of non-solar Tier I requirements in the past years, the PA PUC is issuing a tentative order to procure those shortfalls in the future. As a result, if the PA PUC adjusts the Renewable Portfolio Standards (RPS) in the future to compensate for those shortfalls, will current Default Service suppliers bear the additional cost?

Answer: In a July 8, 2016, Secretarial Letter, the Commission provided notification to all electric generation suppliers (EGSs) and electric distribution companies (EDCs) that the Commission had become aware of an error in how the non-solar Tier I quarterly adjustments were calculated over the previous six years. The Secretarial Letter also noted that the error had been corrected for the 2016 reporting period, resulting in an approximate seven percent increase in the otherwise anticipated annual non-solar Tier I obligations. For the 2016 reporting period (June 1, 2015 through May 31, 2016), the FirstEnergy Pennsylvania utilities have purchased and plan to retire the additional Tier I renewable energy credits (RECs) that were noticed by the Secretarial Letter. For all future reporting periods, the Default Service Supplier will be responsible for any subsequent increases in Tier I requirements under 66 Pa.C.S. § 2814 in accordance with the terms of the Default Service Supplier Master Agreement.

GEN 00073
Published On: 10/18/2016

Question: What RPS percentages will be required throughout the various deal terms for serving load in FE-PA territories given the uncertainty left by the PA PUC about ongoing renewables obligations (and revisions for existing load)?

Answer: Please refer to the definition of Alternative Energy Portfolio Standards and Appendix E of the DSP-IV Default Service Supplier Master Agreement.  Please note that the Tier I requirement may increase from the stated percentage in Appendix E on a quarterly basis consistent with 66 Pa.C.S. § 2814.

GEN 00074 (revised 10/18/2016)
Published On: 10/18/2016

Question: In FAQ GEN 00069, you note that the NITS costs will be the responsibility of the Default Service Supplier. On their public website, FirstEnergy describes their major initiative: Energizing the Future – “a long-term transmission initiative that involves upgrading and strengthening the grid to meet the future demands of our customers and communities. Three key factors are driving this $4.2 billion investment in our transmission system from 2014 through 2017.” (https://www.firstenergycorp.com/about/transmission_projects.html) Further, in their 06/19/2015 SEC Filling, FE states that it “has identified $15 billion in incremental opportunities for reliability enhancement across its 24,000 mile transmission system.” (http://investors.firstenergycorp.com/Cache/30034104.pdf) In other press releases related to the MAIT subsidiary referenced in FAQ GEN 00070, FirstEnergy spokesman Doug Colafella is cited stating that “FirstEnergy expects to invest $2.5 billion to $3 billion over the next five to 10 years on upgrades in the JCP&L, Met-Ed and Penelec zones.” (https://www.rtoinsider.com/firstenergy-transmission-spinoff-mait-16251/) Can FE provide any guidance, absent a public FERC filling, on how these very sizable investments will impact the Future NITS Rates for the term of the procurement? Is there any publicly available information regarding the measures taken to implement the stated investments, what are the current projects in the PJM cue, what are the projects currently being worked on, etc.?

Answer: FE is not able to speculate on the direction or financial impact of any future NITS rate filings.  Such information will be available after a filing is made at FERC.  With regard to the projects in the PJM queue, the information can be found on the PJM website:  http://www.pjm.com/planning/rtep-upgrades-status/construct-status.aspx.

GEN 00075 (revised 10/18/2016)
Published On: 10/18/2016

Question: My counterparty Risk group is assessing credit and was wondering if you would be able to provide Met-Ed’s most recent YE audited financials, as well as their most recent quarterly financials?

Answer: The financials are available at www.firstenergycorp.com.  Once at the Website, they are available under Investors / Fixed Income Investors / Financial Information (non-SEC registrants).

GEN 00076 (revised 10/18/2016)
Published On: 10/18/2016

Question: Please provide any available details of capital expenditures for transmission projects that are expected to go into service in the next three years that are relevant to Metropolitan Edison Company and Pennsylvania Electric Company.

Answer: Transmission projects in the PJM queue can be found on the PJM’s Website:  http://www.pjm.com/planning/rtep-upgrades-status/construct-status.aspx.

GEN 00077 (revised 10/18/2016)
Published On: 10/18/2016

Question: Please provide a listing of the of the transmission projects that are expected to go into service in the next three years that are relevant to Metropolitan Edison Company and Pennsylvania Electric Company.

Answer: Transmission projects in the PJM queue can be found on the PJM’s website:  http://www.pjm.com/planning/rtep-upgrades-status/construct-status.aspx

GEN 00078 (revised 10/19/2016)
Published On: 10/18/2016

Question: On what date were NITS charges for Pennsylvania Power Company converted to a formula based rate from a fixed rate?

Answer: ATSI changed from a fixed rate to a formula based rate on 02/01/2005. The formula rate was adjusted on 06/01/2011 when ATSI joined PJM and most recently on 01/01/2015.

GEN 00079 (revised 11/21/2016)
Published On: 10/19/2016

Question: Please explain the increases in Pennsylvania Power Company’s NITS charges in 2015 and 2016. In particular, what components of the formula-based calculations for the NITS charges contributed to the increases and what was the magnitude of the increases?

Answer: Pennsylvania Power Company is a transmission customer of American Transmission Systems, Incorporated (ATSI).  The ATSI formula rate for 2015 was affected by the following two modifications to ATSI’s FERC-approved formula rate template:

  • The test year was modified from a historical period to a forward-looking period.
  • The transmission rate design was modified from a duel voltage or two-rate mechanism to a single-rate mechanism for all transmission customers operating in the ATSI Zone.
The underlying inputs to the ATSI formula rate filings are available publicly in FERC dockets ER11-3508 and ER15-303 respectively.

GEN 00080
Published On: 10/19/2016

Question: Please explain the difference between how Network Integration Transmission Services (NITS) charges (rates) are currently calculated for Metropolitan Edison Company and Pennsylvania Electric Company and the manner in which they will be calculated under a formula based methodology.

Answer: The transmission revenue rate for Met-Ed and Penelec (Companies) is a fixed rate that was developed pursuant to a black box settlement and approved by FERC in 1998.  It has not changed in nearly 20 years. The Companies have received approval from the PA Public Utilities Commission to transfer the transmission assets of Met-Ed and Penelec to Mid-Atlantic Interstate Transmission LLC (MAIT).   MAIT will file an application under Section 205 of the Federal Power Act seeking Federal Energy Regulatory Commission (FERC) authorization of a forward-looking formula rate structure for transmission service, including NITS, over both the existing transmission assets (i.e., the transmission assets that MAIT acquires from the Companies under the proposed transfer) and the transmission assets that MAIT develops and owns in the future.  MAIT’s formula rate will differ from the current fixed (stated) rate in that:  (i) MAIT will annually update its transmission revenue requirement and resulting rate, and (ii) the Companies’ current stated rate was calculated based upon the combined transmission revenue requirements of the Companies and Jersey Central Power & Light Company.  The final determination of MAIT’s rate formula is subject to FERC approval.

GEN 00081
Published On: 11/03/2016

Question: Is there a deadline to submit comments on the pre-bid letter of credit?

Answer: Any proposed changes to Credit Documents must be submitted by the Part 1 Application deadline. For more information, refer to Appendix C of the Part 1 Application.

GEN 00082 (revised 11/21/2016)
Published On: 11/21/2016

Question: Are auction revenue rights (ARRs) for PJM delivery year 2016-2017 allocated to Default Service Suppliers, and if so, how are they allocated?

Answer: PJM allocates ARRs to Default Service Suppliers.  See FAQ GEN 00044 and FAQ GEN 00045.

GEN 00084
Published On: 11/30/2016

Question: Can you provide the tranche sizes for West Penn Power for Residential and Commercial and Penn Power Residential and Commercial for 1 tranche? What is the percentage of Default Service load for just 1 tranche for each of those products?

Answer: The approximate MW-per-tranche sizes and the values for the percentage of Default Service load are posted on the News page of the Information Website at www.fepaauction.com/News.aspx.

GEN 00085 (revised 01/18/2017)
Published On: 12/06/2016

Question: What are the 2017 NITS rates for Met-Ed, Penelec, Penn Power, and West Penn Power?

Answer: The NITS rates can be found at  www.fepaauction.com/Documents/NITSRateInformation.aspx.

GEN 00086
Published On: 12/06/2016

Question: On the Web page at http://www.fepaauction.com/Documents/NITSRateInformation.aspx, the NITS rate for Allegheny Power Zone is shown as $15,396.00/MW/year, which is equivalent to $42.18/MW/day assuming 365 days per year. But in FAQ GEN 00023, West Penn Power's NITS rate is shown as $49.027397/MW/day assuming 365 days per year. (This rate is also equivalent to the $17,895 MW/year on the PJM Website.) Could you please indicate which one is the current rate for West Penn Power?

Answer: GEN 00023 is outdated and has been removed from the FAQ page.  Current NITS information is available at www.fepaauction.com/Documents/NITSRateInformation.aspx.

GEN 00087
Published On: 12/06/2016

Question: Is there a tranche fee for FirstEnergy tranches? If not, how does the consulting companies conducting the auctions get paid for their services?

Answer: There is no tranche fee paid by bidders in the auctions.  The Auction Manager is paid by submitting invoices to FirstEnergy for its services.

GEN 00088 (revised 01/18/2017)
Published On: 12/06/2016

Question: Can you give us all historical dates when Commercial customers were moved into Industrial depending on their demand level for Met-Ed, Penelec, Penn Power, and West Penn Power? For example, on June 1, 2015, West Penn Power Commercial was redefined to exclude interval customers with demands of 400-500 kW. What are all the historical dates when Commercial was redefined?

Answer:
Met-Ed / Penelec
January 1, 2011 to current:  HPS created to include GS-Large, GP, and LP

Penn Power
January 1, 2007:  Hourly Pricing (HPS) becomes effective, including GP and GT
June 1, 2008 to current:  Special Rule GSDS added to HPS

West Penn Power
January 1, 2011:  HPS created to include Rate Schedules 30-large, 40, 41, 44, 46, 86, and PSU
May 3, 2015 to current:  HPS changed to include RS 35, 40, 44, 46, and PSU

GEN 00089 (revised 01/18/2017)
Published On: 12/16/2016

Question: Was Docket No. ER17-211-000 approved by FERC? It pertains to the NITS rate effective 1/1/2017 for Met-Ed.

Answer: As of December 15, 2016, there has been no resolution in Docket # ER17-211-000.  You can check for updates by entering the Docket Number (ER17-211) at https://elibrary.ferc.gov/idmws/docket_search.asp.

GEN 00090
Published On: 01/10/2017

Question: Does West Penn Power and Penn Power have Tier I, Tier I Solar, and Tier II alternative energy portfolio standard obligations? Are the percentages the same for West Penn Power and Penn Power?

Answer: Please see the responses to FAQs GEN 00013 and GEN 00014, as well as Appendix E of the Supplier Master Agreement (SMA).

GEN 00091
Published On: 01/13/2017

Question: Do winning bidders have to pay Pennsylvania Gross Receipt tax?

Answer: Bidders should consult their tax advisors regarding the applicability of the Pennsylvania Gross Receipts tax.

GEN 00092
Published On: 01/18/2017

Question: Do you know of any municipal aggregation that could happen in West Penn Power, Penn Power, Penelec, or Met-Ed?

Answer: Refer to FAQ GEN 00064.

GEN 00093 (revised 01/20/2017)
Published On: 01/20/2017

Question: Are there any plans for ATSI or APS to increase their transmission rate in 2018?

Answer: Please see FAQ GEN 00071.

GEN 00094
Published On: 03/27/2017

Question: We understand that on March 10, 2017, FERC approved the MAIT NITs rate effective July 1, 2017 for MetEd and Penelec. Can you quantify the impact of this?

Answer:

FERC stated the following on March 10, 2017:  "MAIT’s proposed Tariff revisions are accepted for filing, suspended for the maximum five-month period, to become effective July 1, 2017, subject to refund, and set for hearing and settlement judge procedures."  Therefore, subject to any subsequent FERC action including but not limited to settlement, PJM will begin billing the proposed rates as filed by MAIT effective July 1, 2017.  The proposed rates and their impact are shown in FAQs GEN 00059 and GEN 00070.  These billings will be subject to refund as FERC stated.  A PJM invoice for transmission service rendered in July 2017 would be received by transmission customers in August 2017 per the normal course of PJM business.

GEN 00095
Published On: 04/04/2017

Question: Are there any proposals, filings, or anticipated changes to the NITS rate for the AP Zone? If so, could you please provide the Docket Number or any other supporting documentation?

Answer: Refer to FAQ GEN 00059 posted on http://www.fepaauction.com/FAQ/General.aspx.

GEN 00096
Published On: 05/04/2017

Question: If an Applicant’s intent is to provide a Pre-Bid Letter of Credit for the Pre-Bid Security, and the Applicant (1) does not provide financial statements of its own, (2) provides financial statements for its Parent company, but (3) does not rely on the Parent company for a guarantee, will the Applicant be considered a Qualified Bidder?

Answer: If the Applicant is relying on the financial standing of a Parent company, and the Parent company is not listed as a Guarantor in the Part 1 Application, the Applicant will not be declared a Qualified Bidder for the auction.  If the Applicant is relying on the financial standing of a Parent company, and the Parent company is used as a Guarantor in the Part 1 Application, the Applicant may be declared a Qualified Bidder for the auction.  However, the Guarantor must agree to guarantee the Winning Bidder’s financial obligations under the Supplier Master Agreement if the Applicant becomes a Winning Bidder in the auction.  More information is provided in the Supplier Master Agreement posted at  http://www.fepaauction.com/Documents/SupplierDocuments.aspx.

GEN 00097
Published On: 08/22/2017

Question: I am interested in finding the load auction calendars for FirstEnergy Pennsylvania.

Answer: The timeline for the next DSP-IV Default Service Program auction is posted at http://www.fepaauction.com/Calendar.aspx. Under the "Here" link on the same Web page, you can also find the schedule for all auctions in FirstEnergy's Pennsylvania Default Service Program DSP-IV.

GEN 00098
Published On: 10/10/2017

Question: The current auctions are for the Companies' DSP-IV Default Service Program. What is the timeline for the process for the next Default Service Program, DSP-V?

Answer: As per the Companies’ DSP-IV settlement agreement approved by the PaPUC at Docket Nos. P-2015-2511333; P-2015-2511351; P-015-2511355; and P-2015-2511356, the current program is scheduled to continue without change through May 31, 2019.  Whether the program will continue for the following two-year period (June 1, 2019 through May 31, 2021) and, if so, the details of that continuation are one of several subjects scheduled to be discussed at a collaborative between the parties to the settlement to be hosted by the Companies in October 2017, and will be addressed in a filing containing the Companies' proposals on this and other topics to be made by the Companies no later than January 31, 2018 per the terms of that settlement. 

GEN 00099
Published On: 10/20/2017

Question: I saw that the 3-month West Penn Power Commercial tranche size is 5.26% (26.3%/5) and that the 12-month West Penn Power Commercial tranche size is 5.25% (10.5%/2). Are they supposed to be the same?

Answer: The apparent difference in the West Penn Power Commercial tranche sizes is due to rounding.  For the delivery period covered by the 3-month product, 19 tranches over multiple auctions are being procured.  Of those 19 tranches, 5 tranches are being procured in the October 2017 auction.  Each tranche represents 1/19 or 5.26%.    For the delivery period covered by the 12-month product, it also is the case that 19 tranches over multiple auctions are being procured.  Of those 19 tranches, 2 tranches are being procured in the October 2017 auction.  Each tranche represents 1/19 or 5.26%.  The 10.5% cited in the question actually (more precisely) is 2/19 = 10.526% and 10.526%/2 = 5.26%.

GEN 00100 (revised 10/24/2017)
Published On: 10/23/2017

Question: Will the NITS rates for MetEd/Penelec under MAIT be increasing on 1/1/2018 as projected on the PJM Website at http://www.pjm.com/markets-and-operations/billing-settlements-and-credit/formula-rates.aspx? If so, by how much?

Answer: The updated NITS rates are posted at http://www.fepaauction.com/Documents/NITSRateInformation.aspx.

GEN 00101
Published On: 10/25/2017

Question: Will the NITS rate for Penn Power in the ATSI transmission system be increasing as of 1/1/2018? If yes, by how much? What are the expected rates?

Answer: The updated NITS rates are posted at http://www.fepaauction.com/Documents/NITSRateInformation.aspx.

GEN 00102 (revised 10/25/2017)
Published On: 10/25/2017

Question: The response to FAQ GEN 00014 was revised on 9/21/16 and then the answer to FAQ GEN 00090 published on 1/10/2017 was directed to the response for FAQ GEN 00014. The response for FAQ GEN 00014 specifies the number of Solar and Tier I Alternative Energy Credits (AECs) to be allocated to Default Service Suppliers for West Penn Power load for DSP-IV. Can you confirm that those same amounts apply to the October 2017 procurement and all future procurements under DSP-IV?

Answer: Yes. The DSP-IV table in FAQ GEN 00014 represents the annual Solar and Tier I Alternative Energy Credits (AECs) per tranche allocated to the winning suppliers for each auction in DSP-IV.  Since the table represents annual allocations, a supplier that wins a Commercial 3-month tranche will receive 3 SPAECs and 242 Tier I AECs, which are 25% of the annual total, respectively.  A supplier that wins a 24-month tranche will receive that same annual allotment of SPAECs and Tier I AECs each year.

GEN 00103
Published On: 10/26/2017

Question: Are there any seasonal scaling factors which impact the auction clearing prices paid by the EDCs to suppliers?

Answer: There is no seasonal billing factor in DSP-IV auctions.  Please refer to FAQ GEN 00021 posted at www.fepaauction.com/FAQ/General.aspx.

GEN 00104
Published On: 10/26/2017

Question: Could you post a list (or point to the location of one) detailing how many total tranches are available for each Company/Product so that potential suppliers can accurately calculate the exact tranche size for the October 2017 Auction?

Answer: The tranche targets for each auction are shown in a table that is displayed by clicking on the "Here" link on the Calendar page of this Website (http://www.fepaauction.com/Calendar.aspx).

GEN 00105
Published On: 10/30/2017

Question: Do the 3-month Commercial loads flowing from Dec.'17 to Feb.'18 transfer over to auction winning suppliers with ARR credits? If so, what portfolio of paths come with these loads?

Answer:

PJM allocates ARRs to Default Service Suppliers.  See FAQs GEN 00044, GEN 00045, and GEN 00082.

GEN 00106
Published On: 11/08/2017

Question: Can the FEPA companies provide an update to the table given in response to question FAQ GEN 00022 (the number of currently deployed smart meters throughout their respective territories)?

Answer: As of June 1, 2017, approximately 1,058,000 meters along with related infrastructure have been deployed.  The previous number of smart meters reported in FAQ GEN 00022 for Penn Power was overstated. The correct number smart meters deployed by company is as follows:

Meters (000)
Met-Ed 259
Penelec 426
Penn Power 167
West Penn Power 206
Total 1,058

GEN 00107 (revised 01/08/2018)
Published On: 01/08/2018

Question: If each tranche is a % of customer class, what is the relevance of the 50MW tranche size (or 49.33MW or 49.79MW etc)?

Answer: A tranche represents a fixed percentage of a company’s class load. This percentage can be calculated from the information provided under the 'Here' link on www.fepaauction.com/Calendar.aspx or from the relevant news items on www.fepaauction.com/News.aspx. The MW-per-tranche measure is only an estimate of what the actual MW tranche size will turn out to be during the delivery period. For example, for Penn Power Commercial products in the January 2018 auction, one tranche represents 14.3% of the load and the tranche size is estimated to be 45.84 MW/tranche.

GEN 00108
Published On: 01/17/2018

Question: Based on FAQ GEN 00107, if I apply 14.3% to the historical non-shopped Commercial Penn Power load from Mar 1, 2017-May 2017, shouldn't this provide an estimate of the MW/tranche? This logic results in a tranche size of 6MW though. Am I not applying the 14.3% to the correct load parameter?

Answer: MW/tranche is calculated using the Peak Load Contribution (PLC) Daily Zonal Scaling Factor (DZSF) times the Shopped and Non-Shopped Capacity Peak Load Share (PLS) by Class and dividing that number by the relevant number of tranches.  For example, using the data from the Load and Other Data section for Met-Ed Residential on 1/1/18:

PLC DZSF = 0.99192 (Daily Zonal Scaling Factor spreadsheet)

Residential Capacity PLS = 844,325 (non-shopped) + 419,337 (shopped) = 1,263,662 KW = 1,263.662 MW (Capacity and Transmission PLC by Rate spreadsheet)

Met-Ed Residential Tranches = 24

MW/Tranche = 0.99192 * 1,263.662 / 24 = 52.2 MW/Tranche

GEN 00109
Published On: 01/23/2018

Question: Once established as a load serving entity (LSE) in PJM, are there any Pennsylvania PUC regulatory approvals required to provide Default Service Supply in these auctions?

Answer: Pennsylvania PUC regulatory approvals are not required to participate in the auctions.  Default Service suppliers must meet the requirements as stated in the Companies’ Bidding Rules, the Part I and Part II Applications, and the Supplier Master Agreement (SMA).  After each auction, the Pennsylvania PUC reviews and approves the auction results.

GEN 00110
Published On: 01/24/2018

Question: When is AEPS compliance required by? Is there a window after delivery so that actual volumes are known?

Answer: In PA, Alternative Energy Portfolio Standards (AEPS) compliance is due September 1.  The compliance reporting year runs June 1 through May 31.  Actual volumes typically are available by mid to late July.

Bidding Rules

RULES 00001
Published On: 11/02/2012

Question: Do all winning tranches for a product get paid the same price?

Answer: Yes, all winning tranches for a product are paid the same price.

RULES 00002
Published On: 11/02/2012

Question: Must all products in the auction clear simultaneously?

Answer: Products in the auction do not close product by product. The auction will continue, and bids can be placed on any products, as long as at least one product is over-subscribed. The Bidding Rules provide the complete set of conditions that determine when the auction concludes.

RULES 00004 (revised 11/06/2014)
Published On: 12/14/2012

Question: If we bid on certain products and do not bid on certain other products, would we still be able to follow the auction for these other products. i.e., would we know the clearing prices of the products we did not bid on?

Answer: During the auction, while you have eligibility to bid in the auction, you will see the status of all products in the auction including any products that you do not bid on.  At the close of the auction, the winning bidders for any product in the auction will see the closing prices for all the products in that auction.  Bidders who do not win any tranches in the auction will not be able to see the closing prices for any product.

RULES 00005
Published On: 01/10/2013

Question: Is the price decrement formula going to be available to the bidders?

Answer: The price decrement formula is not going to be available to the bidders.

RULES 00006
Published On: 01/11/2013

Question: Referenced in 5.4 of the Bidding Rules, when will the reporting ranges be made available to bidders? Also, will the pre-determined level that determines when total supply will be reported simply as below that level be made available prior to the auction?

Answer: The ranges that will be used to report total supply bid after each round in the auction will be provided to Registered Bidders no later than one day before the start of the auction.  This information also will include the level below which total supply bid is reported simply as being below a pre-determined number of tranches.

RULES 00008
Published On: 10/29/2014

Question: In the Default Service clock auctions, if no products receive a price decrement after a round, does this mean that the auction is over?

Answer: Not necessarily.  Pursuant to the Bidding Rules, the presence of free eligibility can keep the auction open even if no product receives a price decrement.

RULES 00009
Published On: 02/10/2016

Question: What determines the reduction in price from one round to another?

Answer: Formulas based on a number of factors and pre-specified guidelines are used to determine the price decrements. Generally, the price decrement for a product will be larger for the earlier rounds in the auction and when the excess supply for the product is greater.  As noted in the Bidding Rules, the Independent Evaluator reserves the right to override the price decrement guidelines.

RUL 00010
Published On: 02/08/2017

Question: When multiple tranches are rolled back to multiple bidders, how do you determine the tranche numbers allocated to different bidders?

Answer: As explained in the Bidding Rules, a random number is assigned to each tranche that is bid. For selecting tranches to roll back, reduced tranches that reflect reduced eligibility for bidders are given priority over reduced tranches that reflect switches to another product. Within each of those two groups of reduced tranches – reduced-eligibility tranches and switched tranches – the random numbers are used to select tranches to roll back. In effect, the rolled back tranches will be proportional based on the number of tranches by which each bidder reduced its bid on the product, but with the condition that reduced-eligibility tranches first are given priority over switched tranches.

RUL 00011
Published On: 02/07/2018

Question: In the Part 2 Application, is it possible to indicate only 1 tranche in 1 zone and still be able to move within zones during the actual auction (for a max 1 tranche) or would an applicant need to submit 1 tranche per EDC in order to do this?

Answer: In the Part 2 Application, you can indicate that you wish to bid on only 1 tranche across all products in the auction by entering 1 for your Indicative Offer at the Maximum Starting Prices.  In this case, your initial eligibility for the auction will be 1 tranche and you will be able to switch your 1 tranche among EDCs and products in response to changes in announced prices (subject to any bidding restrictions).  The Bidding Rules posted at http://www.fepaauction.com/Documents/SupplierDocuments.aspx provide more details.

Load Data

DATA 00007
Published On: 12/21/2012

Question: Can you explain the jump in migration in the Penelec Commercial Customer Class in January 2011 (migration went from 10% to 35% in that one month)? Was there a PUC mandate, or expiring contracts, or some other factor that induced customers to switch during that time period?

Answer: Generation Rate Caps ended on 12/31/2010, and rates associated with the Default Service that started 1/1/2011 reflected market-based pricing.  Commercial customer shopping increased during this time period.

DATA 00009 (revised 11/06/2014)
Published On: 12/27/2012

Question: The historical load data are unadjusted for Unaccounted for Energy (UFE) and deration. Therefore, to determine the amount that a Default Service supplier must deliver and gets paid for (which are equal) in the historical data, you first add the load ratio portion of UFE to each class, and then scale that number by the deration factor. This represents a Default Service supplier's obligation and volume that will be paid on. Is this correct?

Answer: Effective June 1, 2015, in accordance with the PA PUC orders in P2013-2391368, P2013-2391372, P2013-2391375 and P2013-2391378, the PA utilities will be responsible for total UFE and no longer allocate UFE to LSE loads.  A Default Service supplier should no longer add the load ratio portion of UFE to each class’ historical load data to determine its amount of load delivered. Simply apply the deration factor to the historical hourly class loads (which include T&D losses and exclude UFE) to determine energy volumes for delivery and payment.

DATA 00010 (revised 11/06/2014)
Published On: 12/27/2012

Question: Could you confirm if the following statements regarding final settlement load are correct: "(1) Unaccounted for Energy (UFE) load needs to be allocated to historical load for each customer class before the load can be correctly de-rated. (2) The adjusted load with UFE needs to de-rated."

Answer: See FAQ DATA 00009.

DATA 00012
Published On: 01/08/2013

Question: We have adjusted the Peak Load Contribution (PLC) data provided for each Company on the Auction Information Website with the Daily Zonal Scaling Factors also provided. When we compare our adjusted PLCs to those published by PJM for each Company they do not reconcile. If 100% of the customers are on Default Service, these two numbers should be very close. Why does this occur and how can we reconcile these numbers?

Answer: The load data posted on the PJM Website include wholesale load, which is not included in the Default Service load used in this procurement.

DATA 00013
Published On: 01/10/2013

Question: In the Shopping Statistics data file, the implied number of total (shopping plus non-shopping) customers for the Commercial customers and Industrial customers increases substantially, from ~95,563 and ~129 respectively as of April 1, 2012, to ~114,986 and ~624 respectively as of July 1, 2012, using the provided %'s and number of customers served by an AS. Is this in fact correct, and if so, could you perhaps explain why this is occurring?

Answer: The July 1, 2012 statistics for West Penn Power Commercial and Industrial customers reflect the integration of West Penn Power with its sister FirstEnergy PA utilities following the Allegheny Energy/FirstEnergy merger.  The statistics now are reported from the same FirstEnergy systems and on the same basis as Met-Ed, Penn Power, and Penelec.  The Commercial statistics represent the combination of Types 20 and 30 and now include street light counts, which are reflected in increased total counts.  The Industrial statistics include Type 40, including Schedule 30 Large (greater than 500 kW), which is reflected in the increased in customer counts.

DATA 00014
Published On: 01/11/2013

Question: In the load data files provided for each zone, does the load make up the entire zone or are there additional loads within each load not included in the load data?

Answer: The load data files make up the entire retail load in each zone.  The load attributable to the wholesale munis and coops served within each zone are not included.

DATA 00015 (revised 09/21/2016)
Published On: 01/11/2013

Question: In the provided hourly load data files, the data are broken up between residential, small commercial, and large commercial. The descriptions do not directly correlate with the data definitions provided in the "Data_Description_Document.pdf". Can you provide what rate schedules make up the small commercial data as well as the large commercial data, or explicitly state what customer class the data series correlate with in the data description document?

Answer: The small commercial and large commercial nomenclature appears only in the Penn Power hourly load profile data file.  This small commercial data align with Penn Power Commercial in Section II B of the Data Description document, and large commercial data align with the Penn Power Industrial in the Data Description document.  This has been revised to alleviate any further confusion.

DATA 00018 (revised 11/06/2014)
Published On: 02/05/2013

Question: When do the Companies plan to update the Hourly Load Data, Hourly UFE Data, and Historical Daily Capacity and Transmission Obligations?

Answer: The Historical Daily Capacity and Transmission Obligations are updated the last business day of each month.  The Hourly Load Data and Hourly UFE Data are updated the first week of each calendar month.

DATA 00019 (revised 07/07/2014)
Published On: 02/05/2013

Question: Will the Companies be able to provide forecasted Capacity Obligations by customer type for the current Procurement month?

Answer: No.  The Companies do not forecast Capacity Peak Load Contributions ('PLC').  As noted in the Data Description Document (https://www.firstenergycorp.com/content/dam/upp/files/pa/load-data/Data_Description_Document.pdf), these data are provided on an historical basis.

DATA 00021 (revised 07/08/2014)
Published On: 02/15/2013

Question: Can you please provide the expected Daily Zonal Scaling Factors for the upcoming Planning Year for each zone?

Answer: The forecasted Daily Zonal Scaling Factors will not be posted as the factor is calculated based upon the Capacity Peak Load Contributions which the Companies do not forecast.

DATA 00023 (revised 02/10/2016)
Published On: 06/25/2013

Question: How often are the Daily Zonal Scaling Factors updated on the FE-PA Auction Information Website?

Answer: The Daily Zonal Scaling Factors are updated on the first business day of each month on the FE-PA Auction Information Website.

DATA 00024
Published On: 07/15/2013

Question: It is my understanding that the PLCs that FirstEnergy submits to PJM have already been scaled by the Daily Zonal Scaling Factors provided in the Data Room. Therefore, PJM’s Zonal Scaling Factors as posted in PJM’s eRPM eSuite are equal to one. However, when I take the 5/31/2013 PENELEC Commercial Capacity PLS value posted on the FEPA Auction Load and Other Data page (http://www.fepaauction.com/Documents/LoadandOtherData.aspx) of 275.093 MW and multiply that value by the 5/31/2013 PENELEC Daily Zonal Scaling Factor of 89.781%, I get a value of 247.708 MW. Using our share of the PENELEC commercial load on 5/31/2013, the computed PLC is not equal to the value posted in eRPM for 5/31/2013. Is there another daily factor that is applied to the PLC outside of the Daily Zonal Scaling Factor prior to uploading the values to PJM?

Answer: The PLCs submitted to PJM already have been scaled by the Daily Zonal Scaling Factors as provided in the Data Room.  Please note that the raw PLC values posted in the Data Room when scaled may not match those posted to PJM eRPM because they are created on a monthly basis after the fact.  The Data Room data are not intended, nor should they be used, to verify or validate the values posted to PJM.

DATA 00025
Published On: 07/29/2013

Question: How are the daily zonal scaling factors that are provided in the FEPA data room calculated?

Answer: The DZSF (Daily Zonal Scaling Factor) is calculated by dividing the retail zonal load by the sum of the LSEs PLC values on a daily basis.

DATA 00026 (revised 01/18/2017)
Published On: 12/11/2013

Question: The Met-Ed file containing Daily Zonal Scaling Factors for Network Transmission Service Peak Loads (“NSPLs”) begins with data from 12/1/2012. Are there historical data available prior to this date? Also, can you explain the significant difference between the factor on 12/31/2012 and on 1/1/2013?

Answer: We added the NSPL daily zonal scaling factors to the load data postings starting December 2012.  We are unable to create these data historically.  The significant difference in NSPL Daily Zonal Scaling factors between December 31 and January 1 is due to newly assigned NSPL tickets , as well as a new PJM zonal NSPL target, that are effective each January 1.

DATA 00027 (revised 09/21/2016)
Published On: 12/27/2013

Question: Within the Unaccounted for Energy (UFE) data file, the UFE Factor starts to be published 06/01/2011. Please explain how those factors are calculated.

Answer: Unaccounted for Energy (UFE) represents the hourly Mega-Watt (“MW”) variance between the Companies’ total retail hourly energy (system load) and the sum of (i) the estimated hourly customer loads (both interval metered and profiled) and (ii) associated electrical losses.  The hourly UFE values are in Eastern Prevailing Time (EPT).  See section E of the Data Description Document,  https://www.firstenergycorp.com/content/dam/upp/files/pa/load-data/Data_Description_Document.pdf.  Also see FAQ DATA 00009.

DATA 00031
Published On: 01/11/2014

Question: Can the Company share any background information as to the reason for the substantial increase in Reactive Services in the Penelec Zone in 2013 and whether that is expected to continue in the future?

Answer: Explanation of changes in Reactive Services charges should be obtained from PJM.

DATA 00032
Published On: 01/11/2014

Question: Does the non-shopped residential data provided on the Website as "Capacity and Transmission PLC by Rate" include the Default Service peak load contribution (PLC) associated with load served by the 48-month round-the-clock fixed 50-MW energy-only block procured in January 2010?

Answer: Yes, the posted Capacity and Transmission data include the fixed block Default Service.

DATA 00033
Published On: 01/11/2014

Question: Does the non-shopped residential data provided on the Website as "Hourly Load by Class" include the Default Service load served by the 48-month round-the-clock fixed 50-MW energy-only block procured in January 2010?

Answer: Yes, the posted Hourly Load by Class data include the fixed block Default Service.

DATA 00035
Published On: 01/11/2014

Question: In the historical peak load contribution (PLC) file, the December 31st PLC value for West Penn Residential Default Service customers is 1,088.9 MW. However, the projected Planning Year (PY) 2014-2015 PLC for West Penn Residential Default Service is 910.6 MW. This reflects a decrease of approximately 16% in year-over-year PY PLC values. Can you confirm that this decrease in PY 2014-2015 PLCs relative to PY 2013-2014 PLCs for West Penn Residential Default Service customers is accurate?

Answer: The 2014 PLC snapshot is not a projected value.  It is simply a snapshot of the new 2014 PLC tickets as assigned to the current Residential population.  The decrease is due to the recalculation of new PLCs based on new peak days and an updated zonal target.

DATA 00036 (revised 09/21/2016)
Published On: 01/11/2014

Question: For each EDC how many Default Service customers have enrolled in the Standard Offer Referral Program since its inception?

Answer: This information is posted at http://www.fepaauction.com/Documents/LoadandOtherData.aspx under Shopping Statistics.

DATA 00041 (revised 11/04/2015)
Published On: 10/30/2014

Question: Regarding the new hourly load data posted for West Penn Power, and specifically with respect to the reclassification of the Commercial and Industrial load classes, can you explain why the total load for the zone has changed in many periods? For example: between the WPP_Hrly_Data.xls file available on the Information Website on 9/8/14 and the same file available 10/22/14, the New Industrial column does not explain all the load data differences for HE3-10 in every day of October 2013. In months prior to this there are many periods that also have changes that are not explained by the New Industrial column. Specifically, the very first data point provided, 6/1/13 Hour 1, on 9/8/14 the total eligible load was 2,007,856 and on 10/22/14 the total eligible load was 1,994,476. Non-Shopped Commercial was 185,639 on 9/8/14 and became 180,660 on 10/22, but the Non-Shopped New Industrial load is only 3,459. Once these inconsistencies have been addressed, can you please provide additional historical data for the New Industrial sub-class, optimally starting 1/1/11?

Answer: Until the most recent file posting in October, there was a misclassification of on-peak vs. off-peak hours used in the previous data postings for the time period 6/1/13 through 9/30/13.  To be specific, loads were reported using on-peak losses hours 1 through 23 in error.  Additionally, for October 2013, load was represented incorrectly in hours 3 through 10 as a result of shifting hours forward; i.e., HE 4 should have been HE 3, etc.  With the creation of the New Industrial group, data were re-pulled and these misclassifications were diagnosed and corrected for the historical time periods of 6/1/13 through 10/31/13 in the latest procurement posting.  You will see a correction in total load for West Penn Power as a result of these adjustments.  This error correction impacted calculations specific to this Web posting only.

DATA 00043 (revised 01/18/2017)
Published On: 12/11/2014

Question: We looked at the historical load data in the online data room. For Penelec and Met-Ed, sometimes hourly load is significantly higher than for the previous hour and following hour. For example, in the Penelec hourly load data file, on 12/22/2013, hour 10, both shopped and non-shopped residential load is almost 3 times higher than the load in hour 9. The same load jump also is found for 9/5/2014-Hr12 and for some days in Sept 2010. The issue also exists in the Met-Ed load data (9/11/2013-Hr10). Is this a data error?

Answer: Residential loads, more so than commercial and industrial loads, are weather-sensitive and respond to temperature fluctuations.  9/5/2014 was one of PJM's five critical peak days in both Penelec and Met-Ed as energy demands were at their highest.  Temperatures were above normal this day, especially compared to other days during the summer, and residential loads responded in kind.  The data have been reviewed and are accurate.  Additionally, extreme weather conditions on 12/22/13 also would explain the residential load jump at hour 10.  When weather conditions are extreme, the customer class load diversity decreases significantly as many residential customers turn on their A/C or heat simultaneously, depending on the season.

DATA 00047 (revised 01/18/2017)
Published On: 01/08/2015

Question: Please confirm the TRANS PLS values are correct for Met-Ed. Specifically, there looks to be a significant drop in both the Shopped and Non-Shopped values on 1/1/2015 vs 12/31/2014.

Answer: Yes, the new Trans PLS values for Met-Ed as posted for 1/1/15 are correct.  Met-Ed's 2015 transmission peak target is 200 MW below the previous year's peak.  Additionally, please note that the provided Trans PLS values are not scaled and the Trans (NSPL) scaling factors must be applied.  The scaling factor for 1/1/2015 is somewhat higher than for 12/31/2014.

DATA 00048
Published On: 03/25/2015

Question: In reference to FAQ DATA 00009, can you confirm that the energy volumes that Default Service Suppliers are required to deliver and on which they will be paid effective June 1, 2015, are equal to the provided Hourly Load by Class data multiplied by [1 - (Hourly Deration Factor)]?

Answer: Yes, that is correct as described.

DATA 00052 (revised 11/04/2015)
Published On: 06/18/2015

Question: For Penn Power, the first hour in the load data file is missing. Can you confirm the load is in "Hour Ending" as the Data description document specifies, or if it is in "Hour Beginning"?

Answer: In the file, load data for hour 0 represents hourly load measured between 12:00 am EST and 1:00 am EST which is Hour Beginning EST.  The file has been reposted in Hour Ending EST to be consistent with the time convention language described in the Data Description Document.

DATA 00054
Published On: 06/19/2015

Question: The loss factors are provided by schedules, and without class information that gives us the make-up of each class, we cannot develop a properly weighted loss factor. Can you provide us with either the load data applicable by schedule or the applicable weighted loss factors for the different classes?

Answer: The load data posted on the Information Website are by class type with losses.  The purpose of the data specifically is to provide potential Default Service Suppliers with the information needed to competitively bid to serve non-shopped load available for Met-Ed, Penelec, Penn Power, and West Penn.  These are the data posted to PJM used for billing Default Service Providers and also used to create the EDC invoice to pay Suppliers for purchased power.  While we agree the class type load data do not provide the granularity needed to determine a weighted loss factor, we do not agree that there is a need to determine a weighted loss factor for each class type in order for Default Service Suppliers to competitively price this product since the aggregated load by class with losses is provided.

DATA 00055 (revised 07/24/2015)
Published On: 07/24/2015

Question: Where can I find the actual electrical load numbers (in megawatt-hours) for the previous auctions and future auctions?

Answer: All actual MWh information used for previous auctions and to be used for future auctions can be found here:  https://www.firstenergycorp.com/upp/pa/load_data.html.  Under Hourly Load you will find the MWh data for each operating company by class type.

DATA 00056 (revised 09/21/2016)
Published On: 09/22/2015

Question: Where can information related to demand response add-back during the high 5 peak hours for the PJM Region be found?

Answer: Information on PJM add-backs (also referred to as Load Drop Estimates) can be found in the PJM's Website Manual 19, Load Forecasting and Analysis, in Section 4 and Attachment A: http://www.pjm.com/~/media/documents/manuals/m19.ashx. For the 2015 five (5) coincident peaks, West Penn Power had one add-back on 7/29/15 @ 1600 of 7.3 MW, and Met-Ed had three minimal add-backs on 7/28/15 @ 1600 of 0.2 MW; 7/29/15 @ 1600 of 0.6 MW; and 8/17/15 @ 1400 of 0.2 MW.

DATA 00057 (revised 12/03/2015)
Published On: 09/29/2015

Question: For West Penn Power load data, I noticed an increase in both shopping and non-shopping commercial load starting around 6/1/2015 (what looks like around 30 MW for non-shopping and 50 MW for shopping). Is there a reason for this, or is this an error in the data?

Answer: We verified the accuracy of the data.  When compared to June 2014 average loads, there was very little change in the commercial class year-over-year; less than a 1% decrease in commercial non-shopping load and about a 2% increase in commercial shopping load.  Seasonal changes may influence increased load patterns from month to month; May is generally considered a shoulder month with moderate swings in temperature and load usage versus June which is a warmer weather month with higher consumption.

DATA 00059
Published On: 10/09/2015

Question: For Penn Power small commercial/industrial (SCI) Default Service, PLC dropped about 10MW (~10%) in June 2015. What is the reason behind the drop in PLC during June 2015?

Answer: The posted peak load contribution (PLC) values are unscaled values.  Penn Power's actual load contribution to the 2014/2015 five coincident peak periods (5 CPs) was above target and the zone's actual load contributions to the 2015/2016 5 CPs were below target due to mild summer weather.  If the daily zonal scaling factor is applied to the posted PLC values for May 31 and June 1 (0.98 and 1.02, respectively), you will find that the scaled PLC values are in line.

DATA 00060 (revised 01/18/2017)
Published On: 11/04/2015

Question: Could you provide Network Transmission Service Peak Load (NSPL) values for all utilities and classes for 2016?

Answer: PJM published the 2016 NSPL values by zone on October 26, 2015. The NSPL values by operating company are provided below. The 2016 NSPL values by class will not be available until the end of this year.

Company NSPL (MW) Date Hour
Met-Ed 2,798.4 2/20/2015 0800
Penelec 3,024.3 2/19/2015 1900
Penn Power 983.3 7/29/2015 1600
West Penn Power 3,842.9 2/20/2015 0800

DATA 00062 (revised 11/30/2015)
Published On: 11/30/2015

Question: In order for a Default Service Supplier to estimate their capacity obligation, do they need to scale the hourly load data found in the data room by the reconciliation factors found here, for the applicable delivery year? https://www.firstenergycorp.com/content/dam/supplierservices/files/load-profile/MESummaryDefaultsFactors2015.pdf. Or has the hourly load data found in the data room already been scaled by these factors?

Answer: The reconciliation factors referred to are applied to a customer's metered load with losses to determine a customer's peak load contribution (PLC) value.  Applying these factors to the hourly data posted in the data room would estimate a PLC value not capacity obligation.  To determine capacity obligation, apply PJM's UCAP conversion factor and the daily zonal scaling factor to the class type PLC values.  Both the daily zonal scaling factor and the class type PLC values can be found in the data room https://www.firstenergycorp.com/upp/pa/load_data.html.  The PJM's UCAP conversion factor is the ratio of the respective zone's Final Zonal UCAP to the Base Zone WN Summer Peak.  These values can be found in PJM"s eRPM.  The UCAP conversion factor typically is around 15%.

DATA 00064
Published On: 01/19/2016

Question: In looking at the PLCs posted for PY 16/17 in FAQ DATA 00063, please clarify the following for West Penn Power. Specifically, the posted values in the FAQs imply that 64% of the WPP Commercial MWs have migrated away. In the posted PLC Excel file, the values imply that 59% of the WPP commercial MWs have migrated away as of 12/31/2015. Given that FAQ DATA 00063 states "The stated values do not take into account any migration taking place between January 1, 2016 and June 1, 2016", how do you explain the difference in the two calculated values above?

Answer: The Commercial class PLC values for PY 16/17 reflect the same population as the PLCs provided for 12/31/15. The fact that the shopping Commercial population’s PLCs are a higher percentage of the total commercial PLC for PY 16/17 is a reflection that this population’s load at the time of the PJM five 2015 summer peak hours used to determine PY 16/17 was higher than the non-shopping commercial customers. There is no customer migration taken into account.

DATA 00065 (revised 09/21/2016)
Published On: 01/19/2016

Question: The following question is in regards to the posted FAQ DATA 00057: We are seeing a year-over-year (Jun14-Sept14 to Jun15-Sept15) increase of approximately 11% when comparing eligible (shopped plus non-shopped) load for the West Penn Power Commercial class. When comparing June 2014 average loads to June 2015 average loads we are seeing an increase of 2% for Non-Shopped and 12% for shopped. Could you please confirm that the posted data are correct or provide an explanation for this increase?

Answer: We verified the accuracy of the data.  For June-September 2014, please include the hourly loads in the New Industrial column along with the Commercial column in order to compare against June-September 2015 Commercial loads.  By doing so, there is only a 4% increase in shopping Commercial load and a 2% decrease in non-shopping Commercial load.  The 4% increase in shopping Commercial load can be explained by migration of non-shopping Commercial customers and a moderate increase in load usage year over year.  The New Industrial column represents interval metered Commercial customers with demands between 400-500 kW that were expected to transition to the Industrial class as of 6/1/2015 with the introduction of new rate codes, but that never materialized and they reverted back to the Commercial class.

DATA 00066 (revised 09/21/2016)
Published On: 02/10/2016

Question: What is the size of the total load in the auction?

Answer: For the upcoming auctions, the tranche targets and approximate tranche sizes will be announced on the Information Website.  Additionally, load data can be found on the Information Website at http://www.fepaauction.com/Documents/LoadandOtherData.aspx

DATA 00070 (revised 01/18/2017)
Published On: 04/21/2016

Question: In the answer to question GEN 00060, you give the transmission loss factors. For example, Met-Ed is 0.021. Are these loss factors the same as the average duration factors for the zones? If so, over what period are they the average? If not, what is the source of the loss factor? Can they be found in published tariffs?

Answer: These transmission loss factors are from company loss studies.  These loss factors are provided in the PJM OATT Attachments M-1 and M-2.  They also can be found in the Company retail tariffs.  They do not reflect the PJM company zone deration factors, however the hourly deration factors are posted to this portal monthly.

DAT 00073
Published On: 09/14/2016

Question: West Penn Power hourly data are updated through 7/31/2016; will the utility provide an additional update? The files for the other three utilities are updated through 8/31 or 9/5.

Answer: The updated report will be posted by end of day today.

DAT 00074 (revised 09/26/2016)
Published On: 09/26/2016

Question: West Penn Power Hourly Data file has the following notes:
(1) Please note, starting June 1, 2013, Commercial has been redefined to exclude interval customers with demands of 400-500kW; loads previously associated with these customers have been subtracted from Commercial and are now reported in New Industrial.
(2) New Industrial represents interval metered customers with demands between 400-500 kW; loads were previously reported as Commercial, and as of 6/1/2015, qualifying loads will be classified as Industrial.

Contradicting the second note, on the FAQ Web page, DATA 00065 and 00069 both indicate that the 400-500 kW customers were never transitioned into Industrial class and will stay in Commercial class going forward (Data 00069: “The New Industrial column represents interval metered Commercial customers with demands between 400-500 kW that were expected to transition to the Industrial class as of 6/1/2015 with the introduction of new rate codes, but that never materialized and they reverted back to the Commercial class”).

So from what we understand, in the Hourly Data file, the 400-500 kW customer load is excluded from Commercial for 6/1/2013-5/31/2015 and is under New Industrial starting 6/1/2015, but this contradicts FAQ DATA 00069 that indicates these customers’ load is supposed to be included in Commercial starting in June 2015.

To get the correct history of Commercial load on default service, we will just need to add the load under “New Industrial” for 6/1/2013-5/31/2015 to Commercial, correct? Also, starting in June 1, 2015 either note (2) needs to be revised to reflect that the 400-500 kW load is now included under “Commercial” or if this was a mistake and the 400-500 kW customers is included in the Industrial then the data needs to be corrected. Please advise.

Answer: Yes, add the New Industrial class together with the Commercial class from 6/1/2013 through 5/31/2015 to get an hourly history of the Commercial class during that time period. To avoid further confusion, we will re-post the file with the classes of Commercial, Industrial, and Residential only, and remove the New Industrial grouping.

DAT 00075
Published On: 09/26/2016

Question: Can FE-PA please provide some background on how the capacity file takes into account the customer redefinition? Based on the “WPP_Cap_Trans” file customers in question appear to be included in the Commercial class, please confirm that is the case.

Answer: Starting 6/1/2015, interval metered customers with demands between 400-500 kW and qualifying loads are reported in the industrial class as a result of new rate design; previously, they were classified as commercial.  As such, PLC and NSPL values associated with these customers are reflected in the industrial class starting 6/1/2015.

DAT 00076
Published On: 10/18/2016

Question: Could the Companies provide estimated Network Transmission Service Peak Load (NSPL) values for all utilities and classes based on current customer splits for 2017?

Answer: PJM has not yet published the Zone NSPL targets for 2017 which serve as the basis for the annual customer class NSPL calculations.  The new customer class NSPL values are made available in late December each year.

DAT 00077
Published On: 11/29/2016

Question: To follow up FAQ DATA 00056, where did you get the PJM add-backs for West Penn Power on 7/29/2015 @1600 of 7.3MW? What document indicates that you need to add back 7.3 MW? I looked in PJM's Website Manual 19, Load Forecasting and Analysis, in Section 4 and Attachment A, and could not find that number in there.

Answer: PJM makes the add-backs available in its eLRS system respective to each of the 5 coincident peak (CP) days.  PJM provides the add-back kW on a customer basis respective to each zone.  Add-backs are calculated values based on reductions made at Load Management locations as follows:  (1) under the economic program, (2) for Load Management tests, and (3) for Load Management events.

DAT 00078
Published On: 12/01/2016

Question: For the Penn Power Cap_Trans_PLS, are the units KW or MW?

Answer: The units are kW.

DAT 00079
Published On: 01/09/2017

Question: Can you post the data for the first couple of days of the Capacity and Transmission PLC by Rate class, so we can see how it changed starting January 1, 2017?

Answer: The data have been posted.

DAT 00080
Published On: 01/17/2017

Question: Can you please explain why in the Capacity and Transmission PLC by Rate (PP_Cap_Trans_PLS) file, PennPwr Non-Shopped NSPL increased 6 times from 12/31/2016 to 1/1/2017?

Answer: The large increase in the Penn Power Industrial customer class NSPL is due to a 15 MW Industrial customer that became active last year and was assigned a default Transmission PLC value less than 1 MW at that time.  The 2017 Transmission PLC calculation used this customer's actual load data, increasing its Transmission PLC from less than 1 MW in 2016 to 14.6 MW effective Jan 1, 2017.  A similar change occurred with the Capacity PLC value assigned to this customer effective June 1, 2017.

DAT 00081 (revised 03/22/2017)
Published On: 01/17/2017

Question: Can you please provide PLC data for PJM planning year PY 2017/2018 for each utility by customer class?

Answer: The tables below depict the 2017 PLC values and Daily Zonal Scaling Factors that will become effective on June 1, 2017 for the current populations by customer type for each PA utility. The stated values do not take into account any migration taking place between March 20, 2017 and June 1, 2017.

2017 UNSCALED PLC kW - Snapshot as of 03/20/2017

Non-Shopped Commercial Non-Shopped Industrial Non-Shopped Residential Non-Shopped Total
Met-Ed 172,721 26,998 794,404 994,122
Penelec 207,718 22,981 588,885 819,584
Penn Power 83,243 15,368 242,206 340,817
West Penn 294,300 51,100 1,078,900 1,424,300


Shopped Commercial Shopped Industrial Shopped Residential Shopped Total
Met-Ed 482,560 813,790 434,223 1,730,573
Penelec 512,366 768,172 275,764 1,556,302
Penn Power 211,313 213,027 97,750 522,090
West Penn 635,152 1,102,893 436,892 2,174,938


PLC Scaling Factor
Met-Ed 0.98735
Penelec 1.03140
Penn Power 0.99540
West Penn 1.01143

DAT 00082
Published On: 01/17/2017

Question: Can you please post PJM PY2017/1018 Shopped & Non-Shopped PLCs by class for all four EDCs? Back in January 2016 these values were made available for PJM PY2016/2017 through FAQ DATA 00063.

Answer: Refer to FAQ DATA 00081.

DAT 00083
Published On: 01/20/2017

Question: Could you explain why the daily NSPL number in the PJM MSRS report is different from the number in the online data room? For example, for a single tranche for default residential class at Nov 30, 2016, the MSRS report shows 32.9 for NSPL, however, the data room shows 34.3 (Trans PLS for Default Res.) - (834,231 / 1000) * (0.98706 NSPL scaling factor) * (4.167% Tranche Size ). Similar issue for the UCAP too.

Answer: For Met-Ed, there were 25 tranches bid for the residential class which makes the tranche size percentage 1/25 = 4% rather than the 4.167% value used in your calculation.  The NSPL values in PJM MSRS will match those posted in the data room with this correction.

DAT 00084
Published On: 03/27/2017

Question: From May 3, 2015, West Penn Power Commercial was redefined to exclude interval customers with demands of 400-500kW. Is the West Penn Power load data prior to this date provided adjusted accordingly to the new class definition?

Answer: No, historical Commercial data prior to May 1, 2015 are not recast according to the new class definition, but instead represent Commercial load respective to the class definition effective during that time.

DAT 00085
Published On: 04/18/2017

Question: Can you please provide updated PLC data for PJM planning year PY 2017/2018 for each utility by customer class?

Answer: FAQ DAT 00081 posted at http://www.fepaauction.com/FAQ/Data.aspx is now updated with a 3/20/17 snapshot of PLC data for PY 2017/2018 for each utility by customer class.

DAT 00086
Published On: 05/22/2017

Question: Can someone review and revise the posted data for Penn Power UFE rates for January 2017? Right now the file just repeats values for January 2016 exactly.

Answer: The January 2017 UFE information for Penn Power has been corrected.

DAT 00087
Published On: 06/02/2017

Question: Can you please provide updated PLC data for PJM planning year PY 2017/2018 for each utility by customer class?

Answer: The data now are posted on the Information Website at http://www.fepaauction.com/Documents/LoadandOtherData.aspx.

DAT 00088
Published On: 06/05/2017

Question: Can you please provide PY17/18 PLC as of 6/1/17 as well as the DZSF?

Answer: The data now are posted on the Information Website at http://www.fepaauction.com/Documents/LoadandOtherData.aspx.

DAT 00089
Published On: 06/07/2017

Question: While reviewing the Penelec Capacity and Transmission PLC by Rate worksheet on 5/31/2017, we noticed posted values for Capacity for June 1-3. These values differ from the posted PLC values found in FAQ DAT 00081 to start in June. Can you confirm the source of these readings?

Answer: The posted June 1-3 PLC values represent a customer population snapshot as of May 30.  These are not the final official values but have been posted as information for the upcoming DSP-IV auction.  These values will differ from the PLC values found in FAQ DAT 00081 because those values were reflective of the 2017/2018 PLC values for the population snapshot on 3/20/17.  Customer switching from non-shopping to shopping and vice versa, in addition to normal customer attrition, account for any differences.

DAT 00090
Published On: 06/07/2017

Question: Can you please advise why the DZSF as of March 20, 2017 published in FAQ DAT 00081 for Penelec and Penn Power changed so materially versus the prior auction data?

Answer: The DZSF values as of March 20, 2017, published in FAQ DAT 00081 for Penelec and Penn Power, regretfully were reversed.  The correct PLC DZSFs effective June 2017 are now available at http://www.fepaauction.com/Documents/LoadandOtherData.aspx and https://www.firstenergycorp.com/upp/pa/load_data.html.

DAT 00091
Published On: 10/10/2017

Question: What's wrong with the Penelec data (Capacity and Transmission PLC by Rate, Daily Zonal Scaling Factor)?

Answer: The issue has been resolved and the data are now available.

DAT 00092
Published On: 10/16/2017

Question: We are still seeing some data classified as preliminary and wondering when the final settlement data will be updated? Specifically, the Hourly Load by Class data and the Unaccounted for Energy data beyond 2017-08-01 are currently marked as (P).

Answer: The (P) indicates the data posted are respective to the Primary (daily) settlement posted to PJM.  The (S) indicates that the data posted are respective to the Secondary (60-day) settlement posted to PJM.  The Secondary settlement has been completed and posted through July 2017.  The August Secondary settlement will not be performed until the end of October.  All data posted are the most current data available.

DAT 00093
Published On: 10/16/2017

Question: We noticed a significant change in the shape of the load for the shopping and default service Penn Power commercial load starting in mid-February 2017. Do you have any explanation for this change?

Answer: All Penn Power consumption customers became smart meter enabled in February 2017, and FirstEnergy started to report their actual interval data as of February 20, changing the load shape from profiled to actual.

DAT 00094
Published On: 10/25/2017

Question: In general across the four zones, we noticed that the residential load coincident peaks for 2017 were on the high end based on the historical data posted to the Website. Can you confirm whether or not all consumption customers in all FE-PA zones experienced a change to smart meters this year, similar to the shift in Penn Power zone?

Answer: The conversion of consumption meters to smart meters is ongoing for Met-Ed, Penelec, and West Penn Power.  As smart meters are installed and the meter testing is completed, the hourly data from smart meters have been incorporated into the Residential historical hourly data starting in March 2017.  The percentage of Residential customers with smart meters for these three operating companies will continue to increase through 2019.

DAT 00095
Published On: 10/26/2017

Question: Just to clarify the response to FAQ - DATA 00092 as the data problem is with the “Hourly Load By Class” file for West Penn Power: https://www.firstenergycorp.com/content/dam/upp/files/pa/load-data/westpennpower/WPP_Hrly_Data.xls. Row 32197 to Row 33612 (corresponding to date range between 2017-02-01 to 2017-03-31) and Row 16789 to Row 17532 (corresponding to date range between 2015-05-01 to 2017-05-31) have their settlement type (Column-L) marked as “P”. Why is that?

Answer: The data for May 2015 are final and the label has been corrected.

DAT 00096
Published On: 10/26/2017

Question: Do the Companies have estimated PLC data for PJM PY 2018/2019 for each utility by customer class?

Answer: Customer class PLC estimates for the upcoming PJM planning year 2018/2019 are not currently available.  Customer PLC data for planning year 2018/19 will be made available prior to January 1, 2018.

DAT 00097
Published On: 10/30/2017

Question: Regarding the Penelec residential and commercial loads for the second half of July 2017 (July 18-30), it looks like there is a significant increase in the load as compared to previous months. Could you provide an explanation for this anomaly?

Answer: This anomaly is due to an error.  The Penelec hourly load and UFE data files have been re-posted with corrected July 2017 information.

DAT 00098
Published On: 10/30/2017

Question: Can you explain the large increase in hourly peaks for the Penelec settled summer 2017 load? These peaks are significantly higher than any other previous summer peaks.

Answer: The large increase in the hourly peaks for Penelec settled summer 2017 load was due to an error identified in the Residential and Commercial hourly load data beginning on July 18, 2017.  Corrected hourly load data for July 2017 is now posted.

DAT 00099
Published On: 10/30/2017

Question: There appears to be a significant increase in Penelec Residential & Commercial load beginning on July 18th, 2017. During the same period there is an offsetting increase in the zonal UFE allocation. Is this shift due to switching customers in this zone and these classes on to smart meters?

Answer: An error was identified as the cause of the significant increase in the Penelec Residential and Commercial load beginning on July 18, 2017.  The July 2017 hourly load and UFE data files have been corrected and re-posted.

DAT 00100
Published On: 10/30/2017

Question: Will Default Service Suppliers be allocated any UFE to smooth the transition from profiled to smart-metered load?

Answer: There are no current plans to allocate any UFE to the Pennsylvania Default Service loads.

DAT 00101 (revised 10/30/2017)
Published On: 10/30/2017

Question: Could you provide NSPL values for all utilities and classes for 2018?

Answer: PJM published the 2018 NSPL values by zone on October 23, 2017. The NSPL values by operating company are provided below. The 2018 NSPL values by class will not be available until the end of this year.

Company NSPL (MW) Date Hour
Met-Ed 2,897.0 7/20/2017 1700
Penelec 2,889.9 12/15/2016 1900
Penn Power 900.3 7/19/2017 1700
West Penn Power 3,778.4 12/15/2016 2000

DAT 00102
Published On: 12/08/2017

Question: After June 1, 2017, PJM started reporting scaling factors other than 1 for Met-Ed and Penelec. Before June 1, all scaling factors reported for both Met-Ed and Penelec were 1. Because of the change in scaling factors since June 1, we would like to know if Met-Ed and Penelec have changed how they treat or report the capacity tags provided in the data files on the FE-PA Information Website.

Answer: We have not changed how we treat or report capacity tags in the data files found on the FE PA Information Website.  The unscaled tags continue to be provided as well as the respective scaling factors.

DAT 00103
Published On: 12/15/2017

Question: Please provide PY 2018/19 capacity tags for each customer type for all four utilities. If the capacity tags are not readily available, please let us know when we can expect to receive them. The EDCs are mandated to provide capacity tags to retailers by the end of the year.

Answer: The capacity tags for PY 2018/19 will be provided for all four utilities for each customer type on or before December 27, 2017.

DAT 00104
Published On: 12/28/2017

Question: Can you please provide PLC data for PJM planning year PY 2018/2019 for each utility by customer class?

Answer: The tables below depict the 2018 PLC values and Daily Zonal Scaling Factors that will become effective on June 1, 2018 for the current populations by customer type for each PA utility. The stated values do not take into account any migration taking place between January 1, 2018 and June 1, 2018.

2018 UNSCALED PLC kW - Snapshot as of 12/19/2017

Non-Shopped Commercial Non-Shopped Industrial Non-Shopped Residential Non-Shopped Total
Met-Ed 159,275 27,227 831,382 1,017,884
Penelec 194,548 11,967 574,173 780,688
Penn Power 68,633 1,203 285,516 355,352
West Penn 287,263 42,965 1,068,770 1,398,998


Shopped Commercial Shopped Industrial Shopped Residential Shopped Total
Met-Ed 457,408 775,425 416,222 1,649,055
Penelec 467,741 800,355 233,947 1,502,043
Penn Power 178,885 200,580 100,647 480,112
West Penn 591,737 1,151,704 393,183 2,136,624


PLC Scaling Factor
Met-Ed 1.01525
Penelec 1.02842
Penn Power 1.00794
West Penn 1.01530

DAT 00105
Published On: 01/05/2018

Question: Can the FEPA companies provide initial Transmission/NSPL tags for January 2018 for prospective bidders to tighten up their NITS and related cost estimates?

Answer: The 2018 Transmission/NSPL tags have been posted by class type for all FEPA companies through January 3, 2018 along with the respective Daily Zonal Scaling Factors.

DAT 00106
Published On: 01/09/2018

Question: I understand that the hourly load profile of a tranche is an estimate based on historical loads. Will the companies or PJM provide their own forecasts closer to delivery to be scheduled using InSchedule? Who does this scheduling - the companies or the Default Service provider?

Answer: Please see section 7.3 (Energy Scheduling) of the Supplier Master Agreement.  The Companies are not obligated to provide any day ahead scheduling services.  Also, the Companies do not provide forecasts.

Credit Requirements

CRE 00001
Published On: 10/26/2012

Question: Is there a credit-based tranche bid limit in the Default Service Program auctions?

Answer: No, there is no credit-based tranche bid limit.  There is a load cap that limits the number of tranches any bidder can bid across all products within an auction.

CRE 00002 (revised 05/15/2013)
Published On: 11/02/2012

Question: Bidder applicants are given an option to submit either an LOC or cash for the pre-bid security. Can we propose changes to the LOC and if so when would those be due?

Answer: Yes, during the Part 1 Application process, you can propose redlined changes to the Pre-Bid Letter of Credit. The Word version of the Pre-Bid LOC can be found here: http://www.fepaauction.com/Documents/SupplierDocuments.aspx. The deadline for all Part 1 Application documents for an upcoming auction is announced on the Calendar page of the Information Website: http://www.fepaauction.com/Calendar.aspx.

CRE 00003
Published On: 11/08/2012

Question: What is the timeline for the return of the pre-bid security?

Answer: Once the auction results are approved by the Commission, a pre-bid letter of credit will be marked as canceled and returned, and any pre-bid cash deposit will be transferred to the account designated on the bidder's Part 1 Application.  This will occur as soon as possible if the bidder has won no tranches, or after the winning bidder has signed the Supplier Master Agreement (SMA) and has complied with all creditworthiness requirements of the SMA for the tranches that it has won.

CRE 00004
Published On: 11/26/2012

Question: There are multiple beneficiaries on the Pre-bid Letter of Credit. Can you please confirm that if the Pre-Bid LC is drawn upon, payment will be made to only one account?

Answer: The Companies may do a partial or full drawing in accordance with the terms and conditions specified in the Pre-Bid Letter of Credit.  The Companies would use Annex 2 of the Pre-Bid Letter of Credit for that purpose.  The amount specified in Annex 2 would be directed to a single account.

CRE 00005 (revised 10/10/2014)
Published On: 11/26/2012

Question: (1) With respect to the letter of credit that must be maintained during the term of the Supplier Master Agreement, would each letter of credit have a single EDC beneficiary or would only one letter of credit with multiple EDC beneficiaries be required if the bidder were to be awarded tranches with multiple EDCs to serve full requirements Default Service for those EDCs?

(2) In the event that a bidder is awarded tranches to serve full requirements Default Service under multiple EDC auctions (e.g., for Met-Ed, Penelec, Penn Power, and West Penn Power), will margining be done on an EDC-specific basis (i.e., Total Exposure Amount calculating exposure of that particular EDC only), or would it take into account and aggregate the exposure of all of the EDCs to DS Supplier?

(3) Are the EDCs required by the SMA or any other provision of the Default Service Program to maintain a minimum standard of credit quality (e.g., Minimum Rating as defined in Section 6.4 of the SMA)?

Answer: (1) Each letter of credit that must be maintained during the term of an SMA will have a single EDC beneficiary.

(2) Margining will be done separately for each EDC.

(3) No. The SMAs do not include credit requirements for the EDCs and there is no provision of the Default Service Program requiring the EDCs to maintain a minimum standard of credit quality.

CRE 00006 (revised 07/08/2014)
Published On: 12/03/2012

Question: Can a Pre-Bid LOC be used for consecutive auction events? Our intent would be to instruct the Independent Evaluator in our Part 2 Application for the first event to retain the LOC for the second event if it is allowed.

Answer: Yes, the Pre-Bid Letter of Credit can be kept open for subsequent auctions.  The Expiration Date must be at least thirty days following the date of the last auction for which the LOC will be used.

CRE 00007 (revised 10/10/2014)
Published On: 12/03/2012

Question: How do we deposit cash as pre-bid security?

Answer: Per page 15 of the Part 2 Application, "If you are submitting a cash deposit, you must attach a copy of your W9 (for tax ID) and a copy of your banking information on your company's letterhead, signed and dated."  To make a cash deposit, request the wiring instructions from the Independent Evaluator.  Also on page 15 of the Part 2 Application, you must provide your wiring instructions that will be used to return your cash deposit.  This information is needed so that the cash can be returned promptly to the bidder.

CRE 00008 (revised 10/10/2014)
Published On: 07/29/2013

Question: Sections 6.1 of the Supplier Master Agreement (SMA) requires the Default Service Supplier to "inform the Company immediately of any changes in its credit rating or financial condition," and Section 6.8(a) of the SMA requires the DS Supplier to "inform the Company immediately of any changes in its credit rating or financial condition or that of its Guarantor." Can you provide examples of when the Companies want to be notified?

Answer: A couple of examples:  (1) If a Supplier's credit rating from any of the three SMA-referenced rating agencies changes, notification to the Companies is required.  (2) If a material event occurs that detrimentally impacts a Supplier's financial condition, such as what would be reported in an 8-K filing, then the Companies require notification.

CRE 00009 (revised 02/23/2015)
Published On: 12/09/2013

Question: In a follow-up to FAQ CREDIT 00006, may a Supplier request that the pre-bid letter of credit posted for the upcoming auction be held by CRA for future auctions? The Supplier would instruct the bank to amend the letter of credit to $1.00 in between auctions, amending it by increasing to the proper dollar amount at the time of the next auction. The pre-bid letter of credit would not expire for one calendar year hence.

Answer: Yes, CRA can hold the pre-bid letter of credit on file.

CRE 00011
Published On: 10/14/2014

Question: What is the amount per tranche required for the "maximum Pre-Bid Security" discussed in the Part 1 Application, necessary for applicants with foreign guarantors?

Answer: The pre-bid security amount is $250,000 per tranche of desired initial eligibility, regardless of whether there is a foreign guarantor.

CRE 00012
Published On: 10/14/2014

Question: Can you confirm the limit amounts necessary for inclusion in Section 1 of the Guaranty (Appendix G of the Default Service Supplier Master Agreement) for “Option 1” and “Option 2” in that paragraph? Additionally, if we are currently a Default Service supplier and we win any products in the October 2014 DS auction, is it possible to extend the guaranty already in place to cover any new products won, or is a new guaranty required?

Answer: The amounts for Option 1 or Option 2 are at the discretion of the Guarantor.  The Guarantor can issue a guaranty amount up to the Maximum Credit Limit based on the Guarantor's Credit Rating per Appendix A of the Supplier Master Agreement.  If the Total Exposure Amount exceeds the Guaranty amount, then a Margin call may be required per Section 6.5 of the Supplier Master Agreement.  Since this is a new delivery period, the Companies prefer that a new guaranty be issued, which is Appendix G of the Supplier Master Agreement.

CRE 00013
Published On: 02/23/2015

Question: Per the SMA, the Company needs to be notified of any changes to the Supplier's financial stance. Is there a materiality standard? Would you be able to provide examples of what would trigger this requirement?

Answer: Any change in the Supplier's credit rating would require a notice to the Company.  An example of a change in the financial condition that would trigger a notice is a 5% or greater change in the Supplier's Tangible Net Worth.

CRE 00014
Published On: 02/25/2015

Question: In the Sample Default Supplier Letter of Credit (Appendix F to the Supplier Master Agreement), what is the intent and purpose of Annex 5? Per Paragraph 7(iv) of the Letter of Credit (LC), the LC is clearly evergreen (stating that unless sooner terminated, the letter of credit “will be automatically extended without written amendment for successive additional one (1) year periods”). Annex 5 is inconsistent with that Paragraph 7(iv). Is Annex 5 a commitment to issue an LC in replacement of the existing LC, assuming no notice of non-renewal has been sent? As written in Paragraph 1 of the LC, the bank is bound to issue Annex 5 which in the event the LC is automatically renewed becomes a contradiction in the LC terms. Would the bank be issuing a new LC with the same number or a new number? If it is a new number, then the existing LC is still on the books until returned for cancellation. Because the LC has an auto-renewal provision in Paragraph 7, when would Annex 5 be required? And if Annex 5 were used, would the bank be issuing a new LC with the same number or a new number with the existing letter of credit to be returned to the issuing bank at the time the new LC is issued?

Answer: Annex 5 may never be needed due to the auto-renewal provision in Paragraph 7.  Annex 5 does give the Supplier the option of issuing a new Letter of Credit with a new number.

CRE 00015
Published On: 03/11/2015

Question: If a Default Service Supplier is not granted an unsecured line of credit based on its creditworthiness, and is also not granted an unsecured line of credit based on the creditworthiness of a guarantor, is there a minimum security deposit that must be provided when the SMA is executed if the DS Supplier is a winning bidder? Or may such DS Supplier provide no security deposit upon execution of the SMA and instead provide cash or a letter of credit only if and when, during the term of the SMA, the Total Exposure Amount exceeds the Minimum Transfer Amount (assuming that such DS Supplier’s credit limit would be $0), pursuant to a request to post Margin?

Answer: If a bidder wins Industrial tranches and has no unsecured credit, then security of $140,000 per Industrial tranche would be required per Section 6.3 of the Supplier Master Agreement (SMA).  If a bidder wins Residential and/or Commercial tranches, the MTM credit exposure methodology in Appendix B of the SMA is used.  If the Total Exposure Amount exceeds the Minimum Transfer Amount (the bidder has zero unsecured credit), then security would be required at the time the SMA is signed.

CRE 00016 (revised 12/03/2015)
Published On: 09/10/2015

Question: The applicant is not rated. Can we still get some unsecured credit by submitting financials? The financials are not audited.

Answer: Per Section 6.4 of the Supplier Master Agreement, in order to be granted an unsecured line of credit, the Default Supply Supplier or its Guarantor (if the DS Supplier is providing a Guaranty) must be rated by at least two of the following rating agencies: S&P, Moody's, or Fitch.

CRE 00017
Published On: 09/30/2015

Question: If an applicant submits cash as their form of pre-bid security, are they bound to that form of security throughout the entire supply period should they win tranches in the auction? Or is an applicant allowed to use cash for pre-bid security and then execute an approved letter of credit after the auction results are known?

Answer: The pre-bid security is returned to bidders once the auction results are reviewed by the Commission. The form of security chosen if the bidder becomes a Default Service Supplier can differ from the form of pre-bid security.  Section 6.7 of the Supplier Master Agreement lists the acceptable methods for posting security as a Default Service Supplier.

CRE 00018 (revised 03/13/2017)
Published On: 03/13/2017

Question: The Part 1 Application indicates the following:

A potential bidder that had secured approval for an alternate form of guaranty from any previous Default Service procurement auction held by one or more of the Companies and wishes to use the same alternate form of guaranty can renew this by submitting the following:
1. The alternate form of guaranty from any previous Default Service procurement auction by the Companies;
2. The enforceability opinion from any previous Default Service procurement auction by the Companies;
3. A certification that the text of the alternate form of guaranty is exactly the same as the alternate form of guaranty that had been previously approved from any previous Default Service procurement auction by the Companies;
4. A certification that the text of the enforceability opinion is exactly the same as the enforceability opinion that had been previously approved from any previous Default Service procurement auction by the Companies.

Are the Companies requesting that these certifications be provided by in-house legal counsel?

Answer: The only certification from outside counsel is the enforceability opinion. The applicant must provide an enforceability opinion with respect to the alternate form of guaranty from its  counsel. The accompanying enforceability opinion must be from a law firm of national (i.e., United States) standing, must not be weaker than would be industry norm, and must contain only those qualifications that would be typical. The opinion shall name the Companies and explicitly state that the Companies are entitled to rely on the opinion for purposes of the transaction at issue.

PJM

PJM 00006 (revised 12/03/2015)
Published On: 01/29/2014

Question: PJM's Energy Market Uplift Senior Task Force is pursuing changes to the energy market that could have an impact on energy prices in the ATSI zone. Specifically, on 12/20/13, the task force posted a document (see link below) that indicates they are contemplating "extending existing logic" for certain "inflexible units" to set LMP when they are called upon to resolve transmission constraints.

The implications of this according to the task force are "More congestion on the system; Higher prices in areas where generation is running under these circumstances; Incremental costs will be removed from uplift as long as these constraints bind."

The task force also indicates that ATSI is one of the areas that would be sensitive to such a change. They propose to implement the new logic on June 1, 2014.

What are the implications of this proposed change on the products offered in the Default Service Auctions?
http://www.pjm.com/~/media/committees-groups/task-forces/emustf/20131220/20131220-item-02c-price-setting-option.ashx

Answer: FirstEnergy's Pennsylvania utilities do not possess information outside what has been presented through the efforts of the Energy Market Uplift Senior Task Force ("EMUSTF") at PJM.  Auction participants in the FirstEnergy's Pennsylvania Default Service Program procurements are responsible for most if not all of the impacted market mechanisms (such as energy, operating reserves, congestion, etc.) because they are deemed hedgeable and within the control of a potential auction winner.  The best source of information on the EMUSTF efforts is directly from the PJM Task Force itself.

PJM 00010
Published On: 01/08/2015

Question: In its recent capacity performance filing, PJM has proposed procuring 2500 MW of additional capacity resources through RMR contracts for PJM Planning Year 2015-2016. If costs associated with these procurements are billed under billing line item 1930 in Appendix D of the Default Service Supplier Master Agreement, will they be the responsibility of the EDC or the DS Supplier? If costs associated with these procurements are billed under a different or new billing line item, will they be the responsibility of the EDC or the DS Supplier?

Answer: In accordance with the Default Service Program documents, the Default Service Supplier is responsible for capacity and such other services or products that the DS Supplier may be required to provide.  Should PJM purchase additional capacity the DS Supplier would be responsible for the additional cost of such purchases regardless of the line item where the charge would be placed on the PJM bill.

PJM 00011 (revised 09/21/2016)
Published On: 01/08/2015

Question: PJM is proposing changes to its capacity market, but how those changes will be implemented is still unknown. If transition period charges are put into invoice line item 1930 for RMR, will they still be a pass-thru to the EDC under the Default Service Supplier Master Agreement (SMA) as it stands? If a new Capacity RMR line item is created for charges on the PJM invoice, will that be the responsibility of the EDC?

Answer: In accordance with Section 2.2 of the Bidding Rules, obligations of Default Service Suppliers exclude Reliability Must Run / Generation Deactivation ("RMR") charges that are implemented after the approval of the Companies' Default Service Plan ("DSP-III") on July 24, 2014.  Charges and credits associated with generating plants that began before the approval of DSP-III by the Commission are captured on the PJM bill on lines 1930 and 2930.  Should PJM create a new line item associated with RMR that includes RMR units after the July 24, 2014 date, the Companies will be responsible for these RMR charges and credits.  Should PJM include charges or credits in lines 1930 and 2930, or in new line items associated with RMR, that are not RMR-related, the Companies will evaluate the charges at that time for proper allocation based on the Bidding Rules and the Default Service Supplier Master Agreement.

PJM 00012
Published On: 02/18/2015

Question: Do the Companies schedule 2 separate load contracts in the InSight Scheduling System, one for the 95% and the second for the 5%, or do they include all the load in one single contract.

Answer: The Companies include the entire amount of load in one PJM InSchedule. The breakdown of the 95% and 5% volume pricing is performed in each Company's monthly Settlement process.

PJM 00015 (revised 01/18/2017)
Published On: 04/28/2015

Question: Could you disclose the charge (monthly cost per MWh or other format) for PJM meter error corrections (billing item 1250) in Met-Ed and Penelec zones? Are the utilities currently allocated this charge?

Answer: Appendix D to the Companies' Supplier Master Agreement lists which PJM billing statement line item charges are allocated to and are the responsibility of Met-Ed and Penelec, and which are the responsibility of the Default Service Supplier.  As shown in Appendix D, line item 1250 (meter error correction) is the responsibility of utility.  It is possible Default Service Suppliers may be allocated and responsible for 1250 meter error correction charges related to EDCs other than Met-Ed and Penelec, however, meter error corrections that are related to Met-Ed and Penelec are not allocated to and are not the responsibility of their Default Service Suppliers.  The PJM billing line item may be a charge or credit each month.  The rate and volume used to determine the charge/credit vary month to month (and therefore so does the charge/credit), but the amounts typically are considered small.

PJM 00016 (revised 09/21/2016)
Published On: 10/13/2015

Question: If PJM begins including additional line items on their bill, will those new line items be the responsibility of the Default Supplier or the Company?

Answer: For the delivery period of June 1, 2015 through May 31, 2021, any new line items that PJM may begin billing will remain the responsibility of the Default Service Supplier under the Companies' Commission-approved plans.

PJM 00017
Published On: 10/15/2015

Question: Can you confirm that the volume of MWh's a Default Service Supplier will be paid on will equal the volume of MWh's a Default Service Supplier will be charged for by PJM? For example if a Default Service Supplier delivers and is paid for 100 MWh, will the PJM bill reflect a 100 MWh charge for the same time period?

Answer: A Default Service Supplier will paid for the de-rated MWh volumes from PJM's InSchedules, which also are the basis for PJM's energy charges to the Supplier.

PJM 00018 (revised 11/04/2015)
Published On: 10/15/2015

Question: What PJM line items are covered on the Delegation of Authority that the winning bidder must sign as part of the confirmation process?

Answer: Please refer to Appendix D of the Default Service Supplier Master Agreement for a list of PJM line items the winning bidder is responsible for. Due to the implementation of PJM’s Billing Line Item Tool, the Delegation of Authority no longer is completed as part of the confirmation process. Billing line item transfers will be created by FirstEnergy’s Regulated Settlements Group and then approved by the winning bidders using the Billing Line Item Tool.

PJM 00019 (revised 01/18/2017)
Published On: 04/05/2016

Question: This question is about the price that load pays for capacity. Can you confirm that the Final Zonal Net Load Price ($/MW-day) for Met-Ed and Penelec zones is $163.21/MW-day, which includes the premium for capacity performance, and not the Adjusted Zonal Capacity Price from the 3rd Incremental auction of $123.35/MW-day?

Answer: PJM posts the final zonal net load prices for capacity on its Website.  Values for each of the FirstEnergy Pennsylvania load zones for capacity can be found at http://www.pjm.com/markets-and-operations/rpm.aspx.  Questions on the PJM RPM posted values should be directed to PJM.

PJM 00021 (revised 10/12/2016)
Published On: 10/11/2016

Question: As per PJM’s FERC EL05-121-009 Settlement Agreement, the Settlement establishes cost responsibility for charges or credits to transmission customers in the PJM Interconnection, L.L.C. (“PJM”) region with respect to transmission projects operating at or above 500 kV approved by the PJM Board prior to February 1, 2013. For PJM Interconnection, L.L.C., Docket No. EL05-121-009, the document "Settlement Agreement and Offer of Settlement" states in section 2.2(b), "Rates and Charges for Covered Transmission Enhancements," that “PJM shall collect from Responsible Customers through the PJM Tariff, as two separate line items on their bills: (i) the applicable Current Recovery Charges … and (ii) the applicable Transmission Enhancement Charge Adjustments." We would like to confirm if further to the Supplier Master Agreements (SMAs) for DSP-III and DSP-IV if such charges or credits will be the responsibility of the EDC or the Default Service Supplier.

Answer: At this time, FERC has not issued an order that relates to FERC Opinion 494.  Once an order is issued by FERC, the PA FirstEnergy operating companies will meet with the PaPUC to seek approval for the retail implementation of the order.  In accordance with section 2.5 of the SMA (PJM Agreement Modifications), both the Default Service Supplier and the EDC shall cooperate to make conforming changes to the SMA and to fulfill the purposes of the SMA.  In this case, it is our intent to pursue EDC responsibility for such credits or charges that may result from implementation of the order.

PJM 00022
Published On: 10/13/2016

Question: On September 15, 2016, FERC issued an order agreeing with PJM’s filing to shift the allocation of balancing congestion cost from FTR holders to Real-time load & exports. Please let us know if FE-PA expects wholesale suppliers to bear the additional cost due to allocation of balance congestion once the order is implemented. Balancing congestion cost has been several hundred million dollars in the last five planning years. PJM is expecting to implement this in June 2017, please advise how the cost will be allocated by the four utilities.

Answer: At this time, PJM has not made its compliance filing on how it intends to implement the FERC order.  Once the filing has been made and an order is issued by FERC, the PA FirstEnergy operating companies will meet with the PaPUC to seek approval for the implementation of the order to their Supply Master Agreement.  In accordance with section 2.5 (PJM Agreement Modifications) of the Supplier Master Agreement (SMA), both the Default Service Supplier and the electric distribution company (EDC) shall cooperate to make conforming changes to the SMA and to fulfill the purposes of the SMA.  In this case, it is our intent to pursue load serving entity responsibility for balancing congestion from financial transmission rights (FTR) holders to real-time load.

PJM 00023
Published On: 12/05/2016

Question: What PJM Zone is the historical generation for West Penn Power and Penn Power located in for auction revenue rights (ARR) purposes?

Answer: West Penn Power is part of the APS Zone.  Penn Power is part of the ATSI Zone.  Historical generation resources for ARR purposes are associated with those respective zones.

PJM 00024
Published On: 01/10/2017

Question: Can you provide the historical generation for ARR auction purposes for West Penn Power and Penn Power?

Answer: Refer to FAQ GEN 00044.

PJM 00025
Published On: 01/13/2017

Question: Is the sink for the Auction Revenue Rights (ARR) auctions for Penn Power ATSI_RESID_AGG or Penn_Power_Resid_Agg?

Answer: PENNPOWER_RESID_AGG - Please refer to FAQ SMA 00011.

PJM 00026
Published On: 01/18/2017

Question: On October 28, 2016, MAIT filed forward-looking formula rates for NITS with FERC effective Jan 1, 2017. Will there be changes to the stated MAIT rate of $22,612.39 per MW-year for 2018 and beyond? Will there be changes to the West Penn or Penn Power (Non-MAIT utilities) NITS rate for 2017, 2018, or 2019?

Answer: Please see FAQ GEN 00031 and FAQ GEN 00059.

PJM 00027 (revised 01/20/2017)
Published On: 01/20/2017

Question: On October 28, 2016, MAIT filed forward-looking formula rates for NITS with FERC effective Jan 1, 2017. Will there be changes to the stated MAIT rate of $22,612.39 per MW-year for 2018 and beyond? Will there be changes to the West Penn or Penn Power (Non-MAIT utilities) NITS rate for 2017, 2018, or 2019?

Answer: Please refer to FAQ GEN 00071.

PJM 00028
Published On: 01/20/2017

Question: Can you please provide the historical NITS rates for APS and ATSI for the past 5 years?

Answer: The NITS rates for the APS zone since March 1, 2002 are posted at http://www.fepaauction.com/Documents/NITSRateInformation.aspx.  The historical ATSI zone rates can be found below.

ATSI Zone (includes Penn Power) NITS Rates ($/MW/Year)
Start Stop 138 KV and above Below 138KV
June 1, 2012 May 31, 2013 9,264.59 13,717.33
June 1, 2013 May 31, 2014 9,921.36 16,348.58
June 1, 2014 December 31, 2014 14,894.53
12,250.47
January 1, 2015 December 31, 2015 34,415.90
January 1, 2016 December 31, 2016 43,391.43
January 1, 2017 December 31, 2016 45,057.62

Note: From June 1, 2012 through December 31, 2014, there were two NITS Rates depending on service voltage.

PJM 00029 (revised 01/20/2017)
Published On: 01/20/2017

Question: What is the difference between NITS charges and Transmission Enhancement Charges (TEC)? What is the function of each?

Answer: See PJM's Guide to Billing, which includes definitions for Network Integration Transmission Service (NITS) and Transmission Enhancement Charge (TEC):   http://pjm.com/markets-and-operations/billing-settlements-and-credit/guide-to-billing.aspx

PJM 00030
Published On: 02/12/2018

Question: Are PJM sub-accounts required for each EDC? If so, how and when are those set up?

Answer: For PJM Pennsylvania Default Service (DS) load reporting, a unique PJM sub-account is required for each EDC/product.  For example, if a DS supplier is serving Penelec commercial, Penelec residential, and Met-Ed residential DS load, three PJM sub-accounts would be required.  These PJM sub-accounts must be unique to the given load (EDC/product).  PJM sub-accounts are established by submitting a PJM Customer Account Manager Designation Form B to PJM which can be found at the following location:  http://www.pjm.com/~/media/about-pjm/member-services/membership-assistant/customer-account-manager-designation-form.ashx.  Questions relating to creating PJM sub-accounts can be directed to:  AccountManager@pjm.com.

Supplier Master Agreement

SMA 00001 (revised 10/10/2014)
Published On: 10/08/2012

Question: In the Bidding Rules Section 3.1 and the SMA Appendix E, a seasonal billing factor is referenced. The summer season is defined as June - September.  Is the June - September correct for contracts for DSP-III auctions?

Answer: Yes, the summer season is defined as June-September for the seasonal billing factor.

SMA 00002 (revised 09/21/2016)
Published On: 10/12/2012

Question: If we already have a signed Supplier Master Agreement with any of the Companies from a prior Default Service auction, will we need to submit a new signed Supplier Master Agreement for subsequent Default Service auctions?

Answer: An executed Supplier Master Agreement (SMA) from a prior Default Service Program  (e.g., DSP-I) cannot be used for a subsequent DSP (e.g., DSP-II, DSP-III, DSP-IV). Only SMAs that have been approved for a particular DSP can be used for that DSP. See also FAQ SMA 00012.

SMA 00004
Published On: 10/16/2012

Question: Are volumes paid based on PJM de-rated volumes or Retail meter volumes?

Answer: The payments to Default Service Suppliers are based on the PJM de-rated volumes.

SMA 00007 (revised 10/05/2016)
Published On: 11/15/2012

Question: Can you post redline documents of the Supplier Master Agreements (SMAs) and Bidding Rules, so the documents can be compared between the current Default Service Program (DSP) and from the prior DSP?

Answer: Please click below to see the redline changes in the SMA document for the June 2017 to May 2021 DSP relative to the document from the June 2015 to May 2017 DSP:

Please click below to see the redline changes in the SMA documents for the June 2013 to May 2015 DSP relative to the documents from the January 2011 to May 2013 DSP:

Also, see FAQs SMA 00005 and SMA 00006 for more on differences in the SMAs between the two DSPs. The Bidding Rules were rewritten and are not directly comparable between the two DSPs.

SMA 00008 (revised 11/04/2015)
Published On: 11/19/2012

Question: (1) In the event that a bidder is awarded tranches to serve full requirements Default Service under multiple EDC auctions (e.g., for Met-Ed, Penelec, Penn Power, and West Penn Power) would each of the Electric Distribution Companies (EDCs) execute the same Supplier Master Agreement (SMA) or would they each sign separate SMAs with the Default Service (DS) Supplier?

(2) In the event that multiple EDCs would execute the same SMA, would such EDCs be jointly and severally liable for Company obligations thereunder and would there be a common agent for them or would each be able to issue conflicting instructions to the DS Supplier?

(3) Should references to Company in the SMA be read as references to a single EDC or to all of the EDCs with respect to which Company has been awarded full requirements/hourly service pricing load?

(4) If there is an Event of Default under the SMA with respect to one EDC, is the DS Supplier entitled to terminate the SMA or other SMAs with respect to the other non-defaulting EDCs?

(5) Conversely, if there is an Event of Default with respect to a DS Supplier relating to load supply to a particular EDC, would the other EDCs have the right to terminate the SMA or other SMAs with respect to the DS Supplier even if the DS Supplier has not defaulted in its obligations to such other EDCs?

(6) How does the second sentence of Section 11.2 in the SMA which states that nothing in the Agreement shall restrict the rights of either party to file a complaint with FERC under relevant provisions of the Federal Power Act work with the Mobile-Sierra provisions in the third paragraph of Section 11.2?

Answer: (1) A winning bidder (Default Service Supplier) will execute a separate SMA document with each EDC for which the winning bidder has been awarded tranches. 

(2) Each SMA document executed by the winning bidder will be executed by only one EDC (not multiple EDCs).

(3) References to Company in the SMA are references to a single Company (i.e., to a single EDC).

(4) No.  Each SMA is between a supplier and a single EDC.

(5) No.  Each SMA is between a supplier and a single EDC.

(6) The right to file a complaint addressed in the second sentence of Section 11.2 of the SMA is separate from standards that may be applied to such a complaint, which are addressed in part in the provision referencing the Mobile-Sierra doctrine. The Companies recommend that all bidders consult with counsel regarding the legal meaning of any provisions of the SMAs.

SMA 00011 (revised 01/18/2017)
Published On: 01/22/2013

Question: Can you supply the PNODE ID of the settlement point for Penn Power and West Penn Power?

Answer: Penn Power PNode ID is 115944307 PENN POWER AGGREGATE.  West Penn Power PNode ID is 8394954 APS ZONE.

Effective June 1, 2015, PJM will require all Zone aggregated LMP settlement points to be replaced with its respective residual aggregated LMP.

For the PA utilities, the following Residual LMPs will apply for settlements:


Company Pnode ID Description
Met-Ed 116472947 METED_RESID_AGG
Penelec 116472951 PENELEC_RESID_AGG
Penn Power 126769999 PENNPOWER_RESID_AGG
West Penn Power 116472931 APS_RESID_AGG

SMA 00012 (revised 11/06/2014)
Published On: 02/11/2013

Question: The winning bidders for the Residential/Commercial (Fixed Price) product in a particular auction have signed the SMA agreements. If they become winning bidders in a subsequent auction, would they have to sign a new SMA or an amendment to an existing SMA? Also, would an additional Guaranty be needed?

Answer: A Default Service supplier and the Company will sign the applicable base Supplier Master Agreement and Appendix E the first time the supplier is awarded Default Service load for that Company for the current Default Service Program (DSP).  For subsequent Default Service awards with that Company in the same DSP, only Exhibit 1 will need to be executed.  In the event there are changes required to the SMA itself in subsequent procurements, a separate full SMA document (including the applicable appendix) can be executed.  If the Bidder wins additional tranches in a subsequent auction, they can simply amend the existing guaranty by adding the date of the new Supplier Master Agreements to the guaranty.

SMA 00013 (revised 09/21/2016)
Published On: 08/21/2013

Question: For the both the pre-bid LOC and performance LOC, the requirements is for the bank to be rated A by S&P and A2 by Moodys. Can a Bank that meets those credit requirements be used even if they do not have a US Branch (Foreign Bank)?

Answer: As long as the issuing bank meets the minimum credit rating requirements, there is no requirement that the bank have a US branch.

SMA 00014 (revised 11/03/2016)
Published On: 08/21/2013

Question: Please advise on the process to provide comments in order to update SMA Appendix F (FORM OF SUPPLIER LETTER OF CREDIT).

Answer: The Companies generally do not modify forms of agreements during an ongoing bidding process, so as to maintain consistency in the rules and application forms across all potential bidders.  Consequently, changes to Appendix F or any other part of the Supplier Master Agreement (SMA) generally are not permitted.

Further, the rules, agreements, and standard forms and supporting documents are reviewed and modified during a public legal proceeding that is intended to provide the opportunity for changes before regulatory approval of those documents is complete.  

SMA 00015
Published On: 08/21/2013

Question: If a bidder's guarantor is formed under the laws of Canada, is an enforceability opinion with respect to the guarantee required to be provided by an outside law firm? Given the trading relationship and substantial overlap in US and Canadian law, can we instead provide an opinion from in-house counsel licensed to practice law in Canada?

Answer: The Companies' bid rules and applications do not specifiy that the opinion letter come from either in-house or external firm counsel.  It is up to the bidder to determine which is most appropriate, to the extent that the selected counsel is fully qualified under the laws of the foreign jurisdiction to provide such an opinion. 

SMA 00017 (revised 10/10/2014)
Published On: 12/02/2013

Question: Our guarantor is based outside of the US. If we become a Default Service Supplier, will we be required to submit a legal opinion & sworn certificates from our guarantor? The process for us to obtain these documents can take in excess of ten business days. If we win tranches in the January auction, when will these documents be due?

Answer: Yes, per Section 6.4 (ii) of the SMA, these documents would be required. These documents, along with the Guaranty and execution of the Supplier Master Agreement, are due within three (3) business days following the Commission’s approval of the auction results.

SMA 00018 (revised 10/10/2014)
Published On: 12/11/2013

Question: The Supplier Master Agreement references the Open Access Transmission Tariff (OATT) for defining "Ancillary Services". The OATT defines the term as: “Those services that are necessary to support the transmission of capacity and energy from resources to loads, while maintaining reliable operation of the Transmission Provider’s Transmission System in accordance with Good Utility Practice.” And “The Transmission Provider is required to provide … the following Ancillary Services (i) Scheduling, System Control and Dispatch, and (ii) Reactive Supply and Voltage Control from Generation or Other Sources.” For the purposes of Default Service supply, is "Ancillary Services" intended to mean ALL load-related charges or some subset of settlement charges related to ancillary services? (I.e.: Reactive Services, Black start, etc.) Are the administrative charges like “Market Monitoring Unit (MMU) Funding,” “FERC Annual Recovery,” and “Organization of PJM States, Inc. (OPSI) Funding” included?

Answer: Yes, per the definition of Default Service Supply in the Supplier Master Agreement (SMA), suppliers are responsible for all load-related charges except as listed in Appendix D in the SMA.

SMA 00020 (revised 09/21/2016)
Published On: 10/23/2014

Question: Can you confirm the seasonal billing factors for DSP-III (June 2015 - May 2017) for summer and non-summer months are both one (1)? Also, in Appendix C of the posted Supplier Master Agreement (SMA) the following is stated: "When specified, numerical multipliers associated with summer months (June-September) and non-summer months (November-May)". I think the non-summer months should be October-May.

Answer: Yes, for DSP-III the seasonal billing factor for both the summer months and the non-summer months will be one (1) for June 2015 through May 2017.  There is a typo on page 6 of Appendix C, DS Supply Specifications, in the SMA:  "(November-May)" should be "(October-May)".  The seasonal billing factor periods are defined correctly on page 10 in the SMA in Article I, Definitions.

SMA 00021
Published On: 02/17/2015

Question: Per the SMA, the Company needs to be notified of any changes to the Supplier's financial stance. Would it be sufficient if we add the Company to the e-mail distribution list for shareholder notifications?

Answer: Adding the Company to the distribution list for shareholder notifications is not an appropriate means to notice the Company of change to financial condition or credit rating per Section 6.1 of the Supplier Master Agreement ("SMA").  Exhibit 2 to the SMA provides the required form of notice and recipients for any required notification under the SMA.

SMA 00022
Published On: 09/10/2015

Question: Section 1.9 Additional Certifications in Part 1 of the Application states, "if you become a winning bidder, you will execute the SMA within three (3) Business Days". Does this imply that the Authorized Representative has to have the ability to sign the SMA? Or that the Applicant (not necessarily the Authorized Rep.) must execute the SMA within the time period specified?

Answer: The SMA does not need to be signed by the Authorized Representative.  The SMA needs to be executed by the Applicant, which may or may not be the Authorized Representative. 

SMA 00023 (revised 12/03/2015)
Published On: 11/16/2015

Question: Section 6.2 of the Supplier Master Agreement (SMA) states: "The DS Supplier may submit and maintain a security deposit in accordance with Section 6.4 of this Agreement in lieu of submitting to or being qualified under a creditworthiness evaluation." However, towards the end of Section 6.2 it also states: "DS Supplier shall provide the Company and its agent’s unrestricted access to audited financial statements; provided that if audited financial statements are not available, the Company, in its sole discretion, may specify other types of financial statements that will be accepted." Does the first statement mean that providing a security deposit would exempt a DS supplier from the audited financial requirements? The entity that we will be using to participate in the auction does not have audited financials, but we can provide un-audited information.

Answer: Per Section 6.2, the Default Service Supplier may submit and maintain a security deposit in accordance with Section 6.4 of the Supplier Master Agreement in lieu of submitting to or being qualified under a creditworthiness evaluation.  Also, per Section 6.2, DS Suppliers shall provide unrestricted access to audited financial statements; provided that if audited financial statements are not available, the Company may specify other types of financial statements that will be accepted.

SMA 00024
Published On: 07/05/2016

Question: For West Penn Power, the Default Service Supplier is responsible for PJM Charge 1104 (NITS Offset). Is the same NITS Offset Charge applied for both retail suppliers (1104.12) and wholesale suppliers (1104.14)?

Answer: Yes, that is correct.

SMA 00026
Published On: 12/01/2016

Question: For Penn Power and West Penn Power, what energy forward price do you use for margin purposes? In these locations, there are no broker quotes.

Answer: Per Appendix B of the Supplier Master Agreement, the energy forward price is based on PJM Western Hub.

SMA 00027
Published On: 12/07/2017

Question: Following up on FAQ PJM 00022, is balancing congestion the responsibility of the supplier? Also, is it known when the SMA will be updated to reflect this charge?

Answer:

Section 2.5 (PJM Agreement Modifications) of the Supplier Master Agreement (SMA) addresses this issue.  The load serving entity, or in this case, the Default Service supplier, is responsible for all balancing congestion line items.  The PA FirstEnergy operating companies plan to formally amend their SMA to reflect this change as part of their filings for the next Default Service plan.

SMA 00028
Published On: 01/17/2018

Question: GEN 00044 states that "Default Service Suppliers independently participate in the PJM ARR/FTR auctions and are awarded ARRs and FTRs from the PJM auction into their individual PJM account. The FE-PA Utilities do not have access to the awarded ARR paths or nominated FTR paths for any Default Service Supplier." However, Section 2.3 of the SMA indicates that "The Company shall transfer or assign to the DS Supplier the Company’s rights to Auction Revenue Rights (ARRs) to which the Company is entitled as an LSE pursuant to the PJM Agreements, including the rights to ARRs, provided that such rights are related to the service being provided to meet the DS Supplier Responsibility Share and such rights are for the Delivery Period." These two statements seem to contradict one another, can you please confirm whether the companies assign ARRs directly to tranche providers? If so, how are ARRs allocated?

Answer: Section 2.3 of the SMA relates to the load that has yet to be assigned to a Default Service (DS) Supplier at the time of the PJM Annual Auction Revenue Rights (ARR) Allocation process.  There may be times when not all the load is assigned to DS Suppliers in time to participate in the PJM Annual Auction Revenue Rights (ARR) Allocation process.  In this case, the FE Companies will be responsible for this load and will obtain the ARRs.  Once suppliers are secured for the unassigned load, the ARRs obtained are allocated to the DS Suppliers by PJM pursuant to the PJM Agreements.

SMA 00029
Published On: 01/29/2018

Question: Where the Supplier Master Agreement (SMA) discusses termination due to default, it states that "The Non-Defaulting Party shall calculate, in a commercially reasonable manner, a Settlement Amount with respect to the obligations under this Agreement. The DS Supplier may, in its sole discretion, select the notional quantity in the following subsection 5.4(a)(i) by checking the box below. If the DS Supplier does not select subsection 5.4(a)(i) by checking the box, it will be deemed to be excluded from this Agreement.” Is there additional information available on how the "commercially reasonable manner" would be determined? Is there a calculation available for the price component?

Answer: No, there is no additional information on “commercially reasonable manner” for calculating a settlement amount.  Any such calculation would be prepared and reviewed after the default and the applicable variables would be applied.  Such settlement calculations are the exception and the pricing component calculation also would be developed after the default event.

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