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PECO Seeks to Change Residential GSA Reconciliation to Annual Basis
April 11, 2011
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PECO has filed a petition with the Pennsylvania PUC to allow the company to credit or collect any Generation Supply Adjustment (GSA) over or under recoveries, plus associated interest, for residential customers on an annual basis, rather than quarterly as currently provided under its default service plan (P-2008-2062739).
Even if the petition is granted, PECO said that it will continue to file quarterly GSA rates for residential customers in order to reflect the projected market price of generation supply.
Currently, the GSA for residential customers is updated and reconciled on a quarterly basis, with any over/under recoveries credited/collected in the first quarter after the reconciliation is calculated. For example, the GSA reconciliation for the second quarter of 2011 (April-June) will be calculated 45 days after the end of the quarter and recovered in the fourth quarter (October-December). For the first quarter of 2011 only, the reconciliation will be recovered over 12 months.
PECO reported that variation in sales caused by factors such as customer shopping and weather seasonality can create large swings in GSA over/under recoveries from quarter to quarter. However, PECO said that these significant shifts in over/under recoveries from quarter to quarter are not reflective of the market price of generation supply and generally offset each other over a twelve-month period.
PECO said that crediting/collecting GSA over/under recoveries on an annual basis will benefit residential customers by smoothing out the sales variability caused by customer shopping and weather seasonality, and will allow the GSA to more closely track market prices.
If PECO's petition is granted, the reconciliation process for the first quarter of 2011 would not change. PECO would credit/recover any first quarter over/under recoveries over a 12 month period (July 1, 2011-June 30, 2012) as provided in the company's existing tariff. After addressing the reconciliation for the first quarter of 2011, PECO would begin to reconcile and credit/collect any GSA over/under recoveries on an annual basis. Thus, the over/under recoveries for each April 1-March 31 period would be credited/collected over the following July 1-June 30 period.
PECO asked that its petition be approved on or before the June 9 PUC meeting, so that appropriate over/under recoveries can be incorporated into the company's estimated Price to Compare for the fourth quarter (posted July 1, 2011) and the GSA for the fourth quarter (filed August 15, 2011).
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