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PUCO Further Delays Transition to 100% Auction-Based SSO Rates at Dayton Power & Light
PUCO issued an entry nunc pro tunc correcting is order issued earlier last week regarding the transition to auction-based default service at Dayton Power & Light, with the corrected order creating a longer transition to 100% auction-based default service rates.
Specifically, the term of DP&L's electric security plan will now run from January 1, 2014 through May 31, 2017 (aligning with the end of the PJM delivery year), rather than the originally ordered end date of December 31, 2016.
Of note is that DP&L is now expected to divest its generation assets by May 31, 2017, rather than the earlier December 31, 2016 date.
Regarding the transition to a market-based Standard Service Offer, PUCO said that the competitive auction products used during a transition period will now be 10 tranches of a 41-month product commencing January 1, 2014, 30 tranches of a 29-month product commencing January 1, 2015, and 30 tranches of a 17-month product commencing January 1, 2016.
In others words, 10% of SSO supply will be auction-sourced for the period January 1, 2014 through December 31, 2014; 40% will be auction sourced for January 1, 2015 through December 31, 2015; and 70% will be auction sourced for January 1, 2016 through May 31, 2017. The balance of SSO will be priced at tariffed rates.
This also extends the potential start date for 100% auction-based SSO to June 1, 2017, rather than January 1, 2017. As with the original order, PUCO did not approve any transition to 100% auction-based SSO, and a blend of 70% auction rates/30% tariffed rates is the extent of market-based rates approved in the order.
Additionally, the nonbypassable stability rider (SSR) will be in effect for three years (through December 31, 2016) at an annual amount of $110 million, rather than only two years.
A potential extension of the rider (SSR-E) would start on January 1, 2017 subject to DP&L meeting certain conditions. These conditions include a plan for generation divestiture and implementation of billing system upgrades to support the retail market. Given that the period for the SSR-E has been reduced to 5 months (through May 31, 2017), and DP&L is now entitled to the regular SSR for the full year 2016, DP&L has less incentive to comply with these conditions, including the retail market billing enhancements, to receive SSR-E revenues.
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September 9, 2013
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Reporting by Paul Ring • ring@energychoicematters.com
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