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Large Pennsylvania Utility Seeks To Impose Per-EDI Transaction Fees On Retail Suppliers
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In a new delivery rate case filed with the Pennsylvania PUC today, PPL Electric Utilities has proposed to recover, from retail electric suppliers (EGSs), "on a per-transaction basis," PPL Electric's costs for EDI transactions
A proposed revision to the PPL Electric supplier coordination tariff states as follows: "Each distinct transfer of data through EDI is considered a transaction.
PPL Electric incurs a per transaction fee for every EDI transaction."
"The Company will directly assign EDI
Transaction fees to each EGS for their EDI transactions. PPL Electric will charge its actual costs incurred
for EDI transaction fees," the proposed EGS coordination tariff states
Each EGS’s allocated amount would
be based on the EGS’s number of EDI transactions compared to the total EDI
transactions for that payment period, PPL Electric said in the rate case
Over the 12-month period July 1, 2024, through June 30, 2025, PPL Electric's EDI transaction fees
totaled approximately $929,000. For the fully projected future test year (FPFTY) used in the rate case, PPL Electric projects that the EDI
transaction fees will total approximately $960,000.
"PPL Electric projects an increase in
these fees based on the estimated level of shopping for the FPFTY," a witness for PPL Electric stated
In addition to the transaction fees for EDI
transactions, PPL Electric also proposes to assign to retail suppliers
the costs of testing a new Data Universal Numbering
System (DUNS) that PPL Electric needs to set up for each EGS.
There are two types
of DUNS testing fees: (1) "Full" testing, which is to test DUNS activity for a new supplier; and (2)
"Abbreviated" testing, which is to test DUNS activity for an existing supplier requesting
an additional DUNS number.
Currently, these costs are $4,867.20 for full testing and
$2,215.98 for abbreviated testing.
These costs would be directly assigned to the relevant EGS
In supporting the new charges to be imposed on EGSs, a witness for PPL Electric said, "PPL Electric believes that these costs are better recovered from the entities directly
causing the costs’ incurrence (i.e., EGSs) as opposed to the Company’s general
customer base, which includes both shopping and non-shopping customers. Moreover,
these EDI transactions and testing costs are a necessary component of the EGSs’ ability
to do business in PPL Electric’s service territory, so it is reasonable and appropriate for
them to be responsible for the costs associated with those transactions. Furthermore, the
EDI transaction costs will be applied on a per-transaction basis. This methodology will
encourage EGSs to more efficiently use Company resources."
The EDI transaction fees and DUNS testing fees would be recovered from EGSs as an offset to payments to EGSs under POR. For EGSs not using POR, PPL Electric would provide an invoice to retail suppliers for the charges. The due date for such invoice shall be
determined by PPL Electric and shall not be less than fifteen (15) days from the date of transmittal of the
bill.
PPL Electric also proposes new credit standards for retail electric suppliers. PPL Electric describes these changes as, "Incorporation of updated credit
requirements for EGSs," but it was not immediately clear how much, if any, of the proposed changes reflect current practice which is just not currently included in the tariff. A cursory review of PPL Electric's EGS site does not appear to inform retail suppliers of a an initial credit amount of $250,000 as proposed to be included in the revised tariff
PPL Electric proposes to add to the EGS coordination tariff a provision stating that, "The Company will apply, on a non-discriminatory and consistent basis, reasonable financial
standards to assess and examine an EGS’s Creditworthiness. These standards will take into
consideration the scope of operations of each EGS and the level of risk to the Company. This
determination will be aided by appropriate data concerning the EGS, including load data or
reasonable estimates thereof, where applicable."
PPL Electric proposes to include in the EGS tariff new language stating that PPL Electric requires an initial credit amount of $250,000 from an EGS, and that PPL Electric shall adjust the amount required, "commensurate with the financial risks placed on the Company by an EGS, including recognition of
an EGS’s performance."
PPL Electric's proposed EGS tariff provided that, "An EGS shall satisfy its Creditworthiness requirement and receive an
unsecured credit limit which will be a maximum of 5% of an EGS’s Tangible Net Worth by
demonstrating that it has, and maintains, investment grade long-term bond ratings," from any two of
the following four rating agencies: Standard & Poor’s, Moody’s Investors’ Services, Fitch IBCA, and Duff & Phelps Credit Rating Company
The proposed EGS tariff provides, "The Company shall make reasonable alternative credit arrangements with an EGS that is unable to meet
the aforementioned criteria and with those EGSs whose credit requirements exceed their allowed
unsecured credit limit."
PPL Electric's proposed EGS tariff provides, "The EGS may choose from any of the following credit arrangements in a format
acceptable to the Company: an irrevocable Letter of Credit; a cash deposit established with the Company;
including the Company as a beneficiary; or other mutually agreeable security or arrangement. The
alternate credit arrangements may be provided by a party other than the EGS, including one or more
ultimate Customers. The fact that an irrevocable Letter of Credit or Cash Deposit is provided by a party
other than the EGS shall not be a factor in the determination of the reasonableness of any alternative
credit arrangement, as long as such party and the related credit arrangements meet the Company’s
standard credit requirements."
PPL Electric in the rate case proposes to update its purchase of receivables discount rates, to reflect updated uncollectibles
The residential POR discount would decrease to 1.80% from the current 2.31%, with the 1.80% reflecting a 1.80% uncollectibles factor and a 0% administrative cost factor
The small C&I POR discount would increase to 0.26% from the current 0.23%, with the 0.26% reflecting a 0.26% uncollectibles factor and a 0% administrative cost factor
PPL Electric would update the Merchant Function Charge factors to equal the uncollectibles rates used in POR listed above.
PPL Electric's POR program already requires that EGSs certify that purchased receivables only include receivables related to basic electric supply service
PPL Electric in the revised EGS coordination tariff proposes to newly define "Basic Electric Supply" as specifically, "Energy (including renewable energy) and renewable energy or alternative energy
credits (RECs/AECs) procured by an EGS, provided that the RECs/AECs are bundled with the associated
delivered energy."
Additionally, "[f]or residential Customers," the revised tariff would provide that Basic Electric Supply does not include early contract
cancellation fees, late fees, or security deposits imposed by an EGS.
In connection with an EGS request for Customer load information, under the Load Data Supply Charge provision of the coordination tariff, PPL Electric would add language specifically requiring that written customer authorization is required prior to the release of such data to the EGS. The current tariff only requires that PPL Electric will provide the data only upon customer consent, but the current tariff does not specifically state that written consent is required.
PPL Electric does not propose substantive changes to its existing Availability of Competitive Billing Services tariff provisions providing for EGS consolidated billing (supplier consolidated billing)
Similar to actions at other Pennsylvania electric utilities, PPL Electric proposes to change how the demand of a customer is measured for purposes of determining such customer's eligibility for the applicable default service class (e.g. fixed price or hourly service), to address "no load" customer generators with distributed generation who are eligible for net metering
PPL Electric says that no-load net metering
installations, typically associated with large sophisticated entities, are currently being classified under the Small C&I default service class (under 100 kW) due to their negligible demand as a result of the distrusted generation. As explained more fully below, this results in additional costs to be recovered from Small C&I default service customers
PPL Electric proposes to use a customer's "maximum registered peak
load" for the purpose of
classifying customers into their respective default service rate schedules.
"Maximum registered peak load" would be defined as, "a customer’s net demand contribution
impact to the Company’s default service procurement activity, as determined upon the
net power flow from or into the Company’s distribution system."
"As related to customer-generators, this
estimate shall also be inclusive of the nameplate capacity of the generation system," PPL Electric's proposed delivery tariff states
The maximum
registered peak load used to assign customers to their applicable rate schedule would be
the customer’s highest maximum registered peak load (kW) in the most recent 12-month
period ending September 30.
A witness for PPL Electric said that, under the current measurement of a customer's demand, larger customers with distributed generation which reduces the customer's peak load may be assigned to the small C&I default service customer class, which has a fixed default service rate. Additionally, annual net metering cash-outs are paid at the fixed small C&I price to compare for these customers
The cost of these cash-outs are recovered from other Small C&I default service customers, increasing the default service rate. PPL Electric warned that these cash-outs may increase significantly in the future
A witness for PPL Electric said, "As of March 31, 2025, the annual net metering cash-outs for the Small C&I customer
class totaled approximately $11 million. However, based on the level of
interconnections projected over the next few years, PPL Electric estimates that the
annual cash-outs for the Small C&I customer class will be approximately $60 million
to over $300 million by 2029."
PPL Electric's proposed change would mean that large no-load customer-generators will be reclassified as Rate Schedule GSC-2
customers (hourly priced default service).
Under the change, cash-outs would be at the GSC-2 default service rate, which is calculated using real-time pricing based on the hourly
generation needs of the customer class.
Likewise, the costs to pay for the relevant excess net-metered generation will be
recovered from the GSC-2 default service rate class, as opposed to the small C&I default service rate class as is done currently
R-2025-3057164
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Proposes New Credit Provisions For Retail Suppliers
Updates POR Discount Rates
Changes To Measuring Customer's Default Service Cutoff, Meant To Assign Costs Away From Small SOS Customers
September 30, 2025
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Copyright 2025 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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