Duquesne Light Company's Default Service Plan

Frequently Asked Questions

General

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GEN 00001

Question: Do you anticipate any changes in Black Start revenue requirements for the Duquesne service zone?

Answer: Duquesne Light advises potential wholesale suppliers to review all the projected billing line items that will be the responsibility of the supplier.  The Company wants to ensure the projected Black Start zonal revenue requirements for the Duquesne Light zone are considered in any 1 and 2 year offers being made by a supplier.    

GEN 00002

Question: Could you please clarify: if a qualified bidder is currently not serving any small commercial load, are they eligible to bid on a total of 4 small commercial blocks in the March 2017 auction? They would not exceed 50% load share in this case.

Answer: The load cap for Small C&I is 2 tranches.  No bidder can bid on or win more than 2 tranches of the Small C&I products.  Some bidders may have additional restrictions depending on the load currently served.

GEN 00003

Question: What is the Reactive Supply Requirement for Duequesne Zone?

Answer: Please refer to the PJM OATT Schedule 2, Manual 27, Section 3 for more information on the billing Charges and Credits.  The PJM website titled "Billing, Settlements, and Credits" is also a helpful too.

PJM state of the market report, section 10, has some aggregate and DLC specific information.

http://www.monitoringanalytics.com/reports/PJM_State_of_the_Market/2016/2016-som-pjm-volume2-sec10.pdf

GEN 00004

Question: Can you give us the ARR paths that were selected for the ARR nomination at PJM.

Answer:

Stage 2 Round 2 of the 2017/2018 Annual ARR Allocation opened today on Monday, March 20, 2017, and will close at 1700 on Tuesday, March 21, 2017.  The results will not be available until 1700 on Friday, March 24, 2017. 

GEN 00005

Question: Do you know of any Municipal Aggregation activity going on in the Duquesne Zone?

Answer: There are no Municipal Aggregation activities that will impact any of the default service load.

GEN 00006

Question: News media outlets have reported that Pennsylvania regulators are considering a change in the PA Solar RPS that would prohibit the use of out-of-state projects to meet new, aggressive solar targets. Can you explain whether these changes may be adopted without legislation, and whether any resulting change in the price or quantity of required SRECs would be borne by suppliers?

Answer: Duquesne cannot speculate on pending legislative action.  Any requirement that changes the price or quantity of SRECs would be borne by the suppliers.

GEN 00007

Question: Can you clarify how code 1952, Deferred Tax Adjustment, is a charge is handled between the EDU and the Default Service Supplier? It appears that Accumulated Deferred Income Tax is currently collected by Duquesne as part of the Distribution System Improvement Charge.

Answer: The wholesale providers that serve load will not see the Deferred Tax Adjustments on the PJM invoice. That line item is not assigned to wholesale suppliers that are serving load and it will not appear on their PJM invoice.  From a POLR or default service, perspective, Duquesne Light remains the LSE. Duquesne procures the supply needed to serve customers but remains the LSE. Customers themselves are not transferred to the wholesale suppliers. As a result, Duquesne Light remains responsible for the Deferred Tax Adjustment.

GEN 00008

Question: Will Duquesne continue with the ARR selection process for this year rather than turning over the last round to winning suppliers?

Answer: Yes.  Duquesne Light will continue the ARR selection process and complete it throughout the term.  The results of the selections will be shared.  The ARR's will be transferred upon completion and prior to the June start. 

GEN 00009

Question: What is the impact of recent changes in Duquesne's reactive service charges?

Answer: In the past, Duquesne Light's POLR providers were charged a PJM average tariff related to reactive supply.  Effective March 2018, the reactive costs align the charges more closely with actual costs in Duquesne's territory.  The current reactive costs are lower than they had been when it was a system wide average cost.  Please refer to the PJM Website for more information on reactive charges.

GEN 00010

Question: FERC issued an order on EL05-121 that impacts charges and credits to certain billing line items from PJM. What will the impact be for POLR suppliers?

Answer: This order will result in changes to PJM line items 1108 and 1115. However, Duquesne suppliers will not see any of these changes on tehir invoices from PJM related to their supplire share of Duquesne's POLR load.  All EL05-121 related credits and charges are internal to Duquesne Light since they are considered transmission related.

Bidding Rules

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RUL 00001

Question: If, for example, a qualified bidder was currently serving one block of Residential load, procured in a previous solicitation, with a term that would overlap the term offered in the March 2017 auction, would the Residential Load Cap for that particular bidder be reduced by one block? Further, would any blocks awarded in the March 2017 auction affect the bidder’s Load Cap for the September 2017 auction?

Answer: Yes.  For the Duquesne Light auction, eligibility is affected by the amount of load currently being served by the supplier.

RUL 00002

Question: Do tranches that are pulled from the auction and tranches that are shifted into other products have the same chance of being rolled back into a prior round product?

Answer: No, if a bidder reduced the total number of tranches it bid across all products, those “reduced” tranches are more likely to be used for rollbacks than tranches that were “switched” from one product to another. As much as possible, such “reduced” tranches are used first for rollbacks, and then “switched” tranches are used for rollbacks if necessary.

RUL 00003

Question: If tranches are shifted into other products and rolled back into a prior round product, how are those tranches identified or earmarked as rolled back so that the bidder has a clear understanding which tranches are subject to rollback?

Answer: When a bidder increases the tranches it bids on a product, the bidder does not specify which product(s) the tranches are coming from. In the rollback algorithm, there is no explicit identification of any switched tranches used for rollbacks. Each tranche is assigned a unique random number. The random numbers are used to select among “reduced” tranches for rollbacks, and then (if necessary) to select among “switched” tranches for rollbacks. When the random process finds a pair of products for which – in effect – a “switched” tranche could be used for a rollback, it does not report the “from” product and the “to” product because all that matters are the rollbacks in aggregate and satisfying a number of constraints per the auction rules (for example, a bidder’s eligibility). Even if it did report the “from” and “to” products, in general that would be meaningless in the sense that if the algorithm were run a second time, it could produce the same result in terms of number of tranches deemed bid on each product (including rollbacks) but with a different set of “from” and “to” products for the switched tranches.

Data

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DAT 00001

Question: What are the tranche sizes for the Residential, Small C&I and Medium C&I?

Answer: The tranche sizes can be calculated using the hourly load data provided on the Information Site. The percentage of the load that the tranches represent is available in the auction schedule published here: http://www.duquesnedsp.com/Portals/0/DUQ_Auction_Products_and_Schedule_DSP_VIII.pdf

DAT 00002

Question: When will you post the PLC for Residential & Street Lighting and Small C&I?

Answer: We are working on the data for the month end close and will send the latest PLC data by the end of the week (3/3).  We will be sending refreshed historical data for the Small C&I, Residential and Lighting and Medium C&I.

DAT 00003

Question: For the Historical PLC_NSPL_MW-Day spreadsheets. Is that the PLC/NSPL for the 1st of the month? For example, column A, has the dates listed as 1/1/2018 to 2/1/2017. Are the PLCs an average of the month or only for that specific day listed?

Answer: The Historical PLC_NSPL_MW Day values in the spreadsheets are actual values from the last day of the month of the date shown in column A .

DAT 00004

Question: In the "Historical Load HPS 2015-2016" load data file, unlike other load data, it doesn't split default and egs load data. Are they all default load, egs load or total load?

Answer: The load data provided is Historical Load for HPS customers that have been on default service during the period of time shown.  This load represents a small percentage (2-3%) of the total load that is not being serviced by EGSs (Retail Suppliers).  For this customer class, the amount of customers and load has been, historically, consistent and lacks the switching aspect of the other default service customer classes.  We did not provide the EGS served load at this time but are considering ways to provide this data in the future.     

DAT 00005

Question: Are the PLC and NSPL in the dataroom scaled by daily zonal scaling factor. Do we need to apply PJM RPM daily zonal scaling factor to get the PJM daily PLC?

Answer:

Our daily uploaded PLC always matches the Base Zonal Weather Normalized Summer Peak. PJM does not need to apply a scaling factor.

 

Our daily uploaded NSPL always matches the expected target value.

 

The PLC and NSPL provided for the auction represent the portion of the uploaded PLC and NSPL for the rate class.

DAT 00006

Question: What is the loss factor to go from wholesale meter to retail meter for Duquesne?

Answer:

The loss factors are as described in the tariff Section 4.7  Energy Scheduling.

Transmission losses = 0.8%

Distribution losses = calculated using Table 1 of the tariff according to Rate Schedule.

DAT 00007

Question: Can you please provide the LC&I historical PLC data for the same time frame as the other rate classes? Other rate classes have PLC data back to 2008 but the LC&I data is only Feb 2017.

Answer: Duquesne Light Company was able to provide the data from 2015 and 2016 for the large C&I customers.  While this is a different time period of data than was provided for the other market segments, we're hopeful that 2 years of data information will be sufficient.  

DAT 00008

Question: Could you post the most current PLC tags for the Medium C&I customers for the 2017/2018 Planning Year? Without that data being publicly posted to all bidders, then any bidder who is also a current supplier has an unfair informational advantage by knowing how tags were reset for the new Planning Year.

Answer: Additional data for the Medium C&I customers has been posted.  The most recent data includes the June PLC value for the Medium C&I load.

DAT 00009

Question: Looking at the customer count data for RES & SL (“Historical Loads 2011-2017 Residential and Lighting” file, “Customer Counts” tab), there is a steep reduction on customers count on both POLR LT and EGS LT. Total Customer count for both categories was 8,249 in May 2014 reducing to 985 by Dec 2014. Any insight on what drove the decrease on customer count?

Answer: During the period in question, May 2014 through December 2014, Duquesne Light Company was putting into production a new billing platform.  The integration of that new billing platform lead to the consolidation of accounts, as we shifted to a different account number/SA ID format, and the retirement of accounts that were found to be unnecessary to integrate into the new system.  The billing system was fully implemented in Q4 2014.  The numbers provided for 2017 are deemed to be accurate and should be used. 

Credit

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CRE 00001

Question: Are there any credit-based tranche caps?

Answer: No.

PJM

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PJM 00001

Question: In the PJM State of the Market Report for 2016 Q3, the estimated Black Start Revenue Requirements for DLCO (Duquesne Zone) are as follows: 2016/2017=$100,000, 2017/2018 = $100,000, 2018/2019 = $3,900,000. Why is there a large increase in planning year 2018/2019 for Black Start revenue requirements for the DLCO zone?

Answer: Black Start units submit annual Black Start revenue requirements to PJM and the IMM for review and approval.  The revenue requirement includes capital, variable, training, and fuel storage costs related to Black Start Service. Zonal rates are based on the capability share of the Black Start Unit’s annual revenue requirements designated to serve that zone.

PJM 00002

Question: What is the current Schedule 1A rate for Duquesne Zone?

Answer: Please refer to the PJM Operating Agreement Transmission Tariff Manual 27 Schedule 1A for additional information on the charges.  The OATT Revisions for Mid-Atlantic Interstate Transmission, LLC Integration has the specific values.  Please see the web address:

http://www.pjm.com/~/media/committees-groups/committees/mc/20160929/20160929-item-04-fe-transition-reorganization-oatt-and-oa-revisions-redline.ashx

PJM 00003

Question: Can you provide the specific PJM Billing Statement Line Items ID#s that the DS Supplier is responsible as part of Rider 9’s Hourly Price Service formula rate?

Answer: The DS Supplier is responsible for all the charges identified in the SMA.  Rider 9 is an explanation of how the customer will be billed. Subsequently, this is how the supplier will be reimbursed and paid.  The primary charges/credits that the DS supplier is not responsible for include NITS, Transmission Enhancement,  Generation Deactivation, Expansion Cost Recovery, and Deferred Tax Adjustment.

PJM 00004

Question: PJM market monitor report forecasts black start charges to increase significantly in 2018 and 2019 for Duquesne zone. Please do you have an insight on when these charges will begin to show on suppliers bill?

Answer: The changes to black start will occur on the PJM planning year which is June through May. Suppliers should plan on any cost changes to black start to occur within that timeframe.

Supplier Master Agreement

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SMA 00001

Question: Please confirm that PJM Line item 1100 (NITSs charges) will be the Company’s responsibility, not the DS Supplier’s.

Answer: Appendix D outlines the supplier's responsibilities.  PJM Line Items 1100 an 2100 (NITS Charges and Credits) will be Duquesne Lights responsibility. 

SMA 00002

Question: Is the Price location Duquesne Residual Aggregate?

Answer: The Market Price Hub is the Duquesne Residual Zonal Aggregate.  The P-node is specifically listed on the Attachment A.

SMA 00003

Question: Are the renewables requirements at the wholesale meter or retail meter?

Answer: The renewable requirements are at the retail meter.

SMA 00004

Question: Will the winning bidders need to complete Exhibit 3 and its Attachment A - Addendum given that the PJM Billing Line Items are now set forth in Appendix D?

Answer:

The Billing Line Item Transfer ("BLI") tool replaced the paper process of completing the Declaration of Authority form ("DOA") in May 2015.  As a result, the DOAs became void and PJM now relies on the information submitted in the BLI tool.  Duquesne does not require bidders to complete Exhibit 3 and its Attachment A – Addendum for Billing Line Item Transfers.  The DOAs will continue to be utilized for other PJM business matters if necessary and may be executed depending on the request of either party.  

SMA 00005

Question: According to Appendix E of the SMA, "For each compliance period during the Delivery Period, the number of (Alternative Energy Credits) AECs that a DS Supplier is obligated to provide may be reduced by a pre-determined number of AECs allocated to the DS Supplier (“Allocated AECs”). The number of Allocated AECs will be defined prior to the Transaction Date." Please advise when such allocation will be made.

Answer: No Alternative Energy Credits have been purchased or obtained by the Company for the Auction that is being conducted in March 2018.  There will be no assignment of AECs to the Suppliers.  As a result the bidders should expect to provide the AECs that are required. 

SMA 00006

Question: Appendix E of the SMA states that Suppliers may be allocated a pre-determined number of AECs for use in AEPS compliance, and that the number allocated will be defined prior to the Transaction Date. Will any AECs be allocated to Suppliers who are awarded load in the March 2017 auction? More specifically, does the DS Variable Payments provision fully compensate Suppliers for all charges assigned to DS Suppliers in Appendix D except 1365, 1375, 1376, and 1378 (ignoring all 1200-series charges, which we understand are partially recovered through the hourly pricing structure of the product)?

Answer: Suppliers will not be allocated any AECs for use in AEPS compliance for the RFP auction being conducted on March 23, 2017.  Suppliers should plan to procure the full AECs requirements that are associated with the load they serve.  DS Variable Payments provision is explained in the Transaction Confirmation and in Rider 9 of our tariff.  The company will remit payment to the suppliers based on the Rider 9 calculation.   

SMA 00007

Question: Please confirm that in addition to the ‘DS Fixed Price Adder For Hourly Price Service’ (auction clearing price), the winning supplier will receive all revenues collected as outlined in the Rider no. 9 tariff (with the exception of the gross receipts taxes and the fixed retail administrative charge - other than the DS Fixed Price Adder For Hourly Price Service). Some context for this question: the ‘DS Variable Payments’ is referenced in both the ‘Transaction Confirmation for Hourly Price Transactions’ and ‘Section 9.1 (a) Bill and Payment’. As defined the ‘DS Variable Payments’ refers to Appendix C, but Appendix C doesn’t point to Rider no. 9 or outline any payments to the winning supplier.

Answer: That is correct.

SMA 00008

Question: Please confirm that the COd in Rider 9 (capacity obligation in MW) represent the customer’s Unforced Capacity (UCAP) as determined by PJM.

Answer: The capacity obligation is determined by PJM.  In order to be consistent, the "Determination of Capacity Obligation" within Rider 9 needs to be applied. 

SMA 00009

Question: In the Supplier Master Agreement the definition of DS Variable Payments is as follows: “The variable supplier payments in dollars based on the Company’s Hourly Price Service formula rate, as set forth in Appendix C hereto, associated with serving the DS Supplier Responsibility Share of the DS Supply.” The referenced formula does not appear to be in appendix C; where is this formula set forth?

Answer: Please refer to Rider 9 for the formula rate and the Transaction Confirmation for Hourly Priced Service.   

SMA 00010

Question: Please list all the payment streams a winning Large C&I supplier would receive.

Answer: The supplier will receive all monies billed to the customer with the exception of the GRT and Duquesne Lights portion of the Fixed Retail Administrative Charge (FRA).  Please refer to Rider 9 and previous answers provided on this question for more information. 

SMA 00011

Question: Is "Reactive Supply and Voltage Control" supplier's responsibilities? If yes, can you please provide the current level for it?

Answer: Appendix D of the SMA outlines the suppliers responsibilities.  Reactive Supply and Voltage Control from Generation & OSS, Billing Line Item 1330 is an ancillary charge that is the supplier's responsibility.  Please refer to the Customer Guide to PJM Billing, and/or the OATT Schedule2, Manual 27, section 3 for more information on this charge.  PJM routinely publishes this information on their Billing, Settlements and Credits are of their website.                                                                              

SMA 00012

Question: Are suppliers of the Hourly Price Service for the Large Commercial and Industrial Class fully compensated via DS Variable Payments for all line items listed in Appendix D, with exception for items relating to balancing energy costs? More specifically, does the DS Variable Payments provision fully compensate Suppliers for all charges assigned to DS Suppliers in Appendix D except 1365, 1375, 1376, and 1378 (ignoring all 1200-series charges, which we understand are partially recovered through the hourly pricing structure of the product)?

Answer: Duquesne will be remitting to the DS Supplier the amounts that are billed to the customer in Rider 9, with the exception of GRT and the utilities portion of the FRA.

SMA 00013

Question: Can you explain why in the Information Session PowerPoint it says that transmission is the responsibility of the default service supplier; however, on earlier slides you say NITS are not?

Answer: Suppliers must deliver a sufficient energy to cover the needs of the default service customers of The Duquesne Light Company which would include energy to cover distribution losses.  Suppliers are, however, paid the auction price for all MWh delivered to the delivery point.  Suppliers are not paid for losses that occur up to the delivery point.  The MSA includes the details of PJM charges that are the responsibility of the supplier and the EDU.

Supply Master Agreement SMA Reference Appendix D

 

SMA 00014

Question: Per SMA Exhibit JP-3, references REC obligations can be reduced if the utility transfers RECs to the DS supplier. Please confirm that for the current bid, no alternative energy credits have been purchased or will be purchased for the delivery periods in this procurement cycle.

Answer: There are no reductions to the Wholesale suppliers AEPS obligations for the delivery periods that are being procured at this auction.  Duquesne Light will not be reducing the DS suppliers AEPS obligations for any delivery periods.     

FAQs Disclaimer

The information provided in the Frequently Asked Questions (“FAQs”) section of the Site has been prepared by Duquesne and its advisors for the purposes of facilitating the Default Service auction process. The information presented and distributed here is subject to update, modification and/or amendment. The information is current as of the posting date. The material presented and distributed here is for informational purposes only and is made available with the understanding that any individual accessing it will use it for the sole purpose of participating in the aforementioned Default Service auction process. The information is not intended to form any part of the basis of any investment decision, valuation, or any bid that may be submitted during the Default Service auction process. This information should not be relied upon, and each recipient should make its own independent assessment of the subject opportunity after making all investigations it deems necessary.

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