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Pennsylvania Utility To Retain Consultant, Owned By Global Utility Holding Co., For Study Of Alternative Default Service Options (Bilateral Contracts, Hedges)

August 29, 2017

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Copyright 2010-17 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

Pike County Light and Power Company (PCL&P) informed the Pennsylvania PUC that it plans to retain EnerNOC to assist with a study of alternative default service supply options.

EnerNOC is part of global utility holding company Enel, which operates regulated T&D assets in various countries, as well as owning generation and retail suppliers globally.

Pike County is required to conduct a study of alternative default service supply options, for both electricity and gas, as a condition of the acquisition of Pike County by Corning Natural Gas Holding Corporation

Specifically, PCL&P is required to study, "alternative supply options" for its gas and electric divisions. For the electric division, the option studied shall include, but are not limited to, the inclusion of bilateral contracts as defined in 66 Pa.C.S. § 2803, which may include the EEI Master Agreement for physical energy purchases and sales and the ISDA Master Agreement for financial energy purchases and sales. The study shall also include, but not be limited to, other flexible options such as purchases of financial (or physical) hedges in small quantities from brokers.

Pike County reported that it plans to retain EnerNOC in asking the Pennsylvania PUC for more time to complete the studies, which are otherwise due August 31, 2017.

"PCL&P submits that good cause exists here because PCL&P’s ability to obtain alternative default supply options, including financial hedges, presents highly complex and unique issues that require additional time and study to ensure PCL&P can fully consider each options [sic] feasibility, costs, benefits, and the most beneficial options in terms of rate stability, long-term costs to ratepayers, and reliability," Pike County said

"To complete this additional study, PCL&P has interviewed, and plans to retain, EnerNOC ... to use its significant expertise in these areas to assist PCL&P to determine and select in its managerial judgment the best options or a mix thereof for future customer default supply for ratepayers," Pike County said

"Regarding electricity supply. EnerNOC will assist PCL&P in further analyzing PCL&P’s current default supply methods, which are presently via an Electric Supply Agreement ('ESA') and a separate Gas Supply Agreement ('GSA') with O&R [Orange & Rockland], that the Commission approved in the Order. EnerNOC will provide PCL&P with supply strategy services and advice in PCL&P’s study of physical plant and commodity options (including financial hedging options) and energy cost risk variance. EnerNOC will also assist PCL&P in developing a supply strategy based on this analysis, which will be based on criteria such as PCL&P’s load data and historical and forecasted requirements. Once a supply and supply management plan is chosen, EnerNOC may assist PCL&P in implementing the plan and provide ongoing analysis and management advice," Pike County said

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