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PA Bulletin, Doc. No. 98-169

PROPOSED RULEMAKING

[52 PA. CODE CH. 57]

[28 Pa.B. 493]

[L-970128]

Advanced Meter Deployment for Electricity

   The Pennsylvania Public Utility Commission (Commission) on November 21, 1997, adopted a proposed rulemaking to ensure that the level of quality regarding metering services will not deteriorate in this Commonwealth. This rulemaking will amend regulations to establish meter deployment and customer selection procedures, meter standards and education strategies for customers choosing to participate in certain generation supply programs which require advanced metering capability. The contact persons for this regulation are Charles F. Covage, Bureau of Conservation, Economics and Energy Planning, (717) 783-3835 (technical) and Stephen Gorka, Law Bureau (717) 772-8840 (legal).

Executive Summary

   On November 21, 1997, the Commission adopted a proposed rulemaking order to establish uniform procedures and standards for the deployment and customer selection of qualified advanced meters or coordination with any Electric Distribution Company (EDC) installation of Advanced Meter Networks (Network).

Regulatory Review

   Under section 5(a) of the Regulatory Review Act (71 P. S. § 745.5(a)), the Commission submitted a copy of these proposed regulations on January 16, 1998 to the Independent Regulatory Review Commission (IRRC) and to the Chairpersons of the House Committee on Consumer Affairs and the Senate Committee on Consumer Protection and Professional Licensure. In addition to submitting the proposed regulations, the Commission has provided IRRC and the Committees with a copy of a detailed Regulatory Analysis Form prepared by the Commission in compliance with Executive Order 1996-1. A copy of this material is available to the public upon request.

   If the Legislative Committees have objections to any portion of the proposed regulations, they will notify the Commission within 20 days of the close of the public comment period. If IRRC has objections to any portion of the proposed regulations, it will notify the Commission within 10 days after the close of the Legislative comment period. The notification shall specify the regulatory review criteria which have not been met by that portion. The Regulatory Review Act specifies detailed procedures for review, prior to final publication of the regulations, by the Commission, the General Assembly and the Governor of objections raised.

Commissioners Present: John M. Quain, Chairperson; Robert K. Bloom, Vice Chairperson; Concurring--Statement follows; John Hanger; David W. Rolka

Public Meeting held
November 21, 1997

Proposed Rulemaking Order

By the Commission:

Introduction

   On December 3, 1996, Governor Tom Ridge signed into law 66 Pa.C.S. §§ 2801--2812 (relating to Electricity Generation Customer Choice and Competition Act) (act). The act revised 66 Pa.C.S. (relating to Public Utility Code) by inter alia, adding Chapter 28 relating to restructuring of the electric utility industry.

   The purpose of the act is to provide for an orderly transition of the Pennsylvania electric industry from a vertically integrated monopoly to a structure which would support the development of a competitive retail generation market. The ultimate goal is to permit all Pennsylvania retail electric customers (customers) to have direct access to a competitive generation market while simultaneously enjoying continued reliable and safe electric service.

   Passage of the act will accelerate changes that are occurring in the historical methods of metering. Previously, almost all residential customers utilized a basic meter that was used to provide a monthly reading of the number of kwh used. Most commercial and industrial customers had a meter that registered demand as well. In some cases, customers worked with their utility to use a different type of meter. In most cases, however, the utility simply provided the meter that it determined was to be used. In recent years, some utilities have begun to deploy systems that can read meters automatically. Such network systems offer opportunities for much greater communication that are the first stage of advanced or specialized metering.

   Now, customers will be able to select an electric generation supplier (supplier) offering a service program that meets the individualized needs of the consumer. The services can be provided with the use of a variety of advanced metering equipment. For example, real-time pricing (RTP) allows a supplier to price electricity at specified intervals based upon its cost during the time of use. Similarly, suppliers may offer and consumers may choose generation services that provide two-way communication for other purposes, load management support, or net metering to support self-generation in conjunction with generation provided by the supplier. While a customer may choose to participate in customer choice without using advanced metering, advanced meters of some form will enable the development of a wider range of generation services in the newly competitive market.

   This discussion will focus on meter deployment and selection issues associated with customers choosing to participate in various advanced meter programs offered by suppliers. The purpose of this rulemaking is to establish uniform procedures and standards for the deployment and customer selection of advanced meters and coordination with any EDC installation of advanced meter networks.

Metering Provisions of the Act--66 Pa.C.S. § 2807(a), (d)

   The act requires the EDC to provide customer service functions consistent with the regulations of the Commission, including meter reading. 66 Pa.C.S. § 2807(d). The services must, at a minimum, be maintained at the same level of quality under retail competition. Subject to Commission approval, the EDC may require that the customer install, at the customer's expense, enhanced metering capability sufficient to match the energy delivered by the suppliers with consumption by the customer. 66 Pa.C.S. § 2807(a). In addition, section 2804(3) of the act (relating to standards for restructuring of electric industry) permits the Commission to require the unbundling of services other than generation, transmission and distribution.

Present Metering Standards

   Commission regulations and statutes address metering operation standards and testing, billing based on meter readings and dispute resolution. 52 Pa. Code §§ 57.20--57.25 and 66 Pa.C.S. §§ 1501--1511. Section 1509 of the Public Utility Code, 66 Pa.C.S. § 1509, also contains certain billing requirements. In addition, National standards for metering exist. For example, the American National Standards Institute (ANSI) has published a number of standards covering electrical metering, time-of-use metering and watt-hour meters.

Procedural Background

   In order to facilitate the eventual establishment of a Preliminary Rulemaking Docket, the Commission staff prepared a Discussion Document on Metering Issues (Document) which was distributed to the Electric Competition Stakeholders (Stakeholders) on March 10, 1997. The Document presented questions which explored the various alternatives associated with metering.

   In addition, to initiate a dialogue with the Stakeholders, a Metering Working Group (Working Group) was established and a public forum was held on March 21, 1997 for all interested parties. Over 90 individuals attended the conference. Presentations were made by QST Energy; Sustainable Systems Research; ENRON Power Marketing, Inc. (ENRON); International Brotherhood of Electrical Workers' Pennsylvania Utility Caucus (IBEW); Clean Air Council; Pennsylvania Electric Association (PEA); and Strategic Energy Limited (SEL). Another meeting was held on April 23, 1997 for members of a working group comprised of various Stakeholders. This meeting focused on presentations by advanced metering companies such as CellNet Data Systems, Inc. (CellNet), Hunt Technologies, ITRON, Inc. (ITRON) and Schlumberger.

   By order, entered April 25, 1997, at Docket M-00960890.F0009, we requested comments concerning certain outlined metering questions. The order was distributed to all jurisdictional EDCs, the Office of Consumer Advocate (OCA), Office of Small Business Advocate and Electric Competition Legislative Stakeholders with a 30-day comment period.

   Written comments were received from 18 parties including: CellNet; Dale Dix (individual member of IBEW); ENRON; Environmentalists; GPU Energy (GPU); IBEW; Industrial Energy Consumers of Pennsylvania (IECPA); ITRON; OCA; Office of Trial Staff (OTS); PEA; PECO Energy (PECO); Pennsylvania Power and Light Company (PP&L); Pennsylvania Power Company (Penn Power); Pennsylvania Retailers' Association (PRA); Pennsylvania Solar Energy Industries Association (PennSEIA); SEL; and Thomas Tamski (private citizen).

Summary of Comments

   Issues surrounding metering in a restructured electric industry present polarized arguments with minimal agreement in certain areas. These issues involve (1) bundling vs. unbundling; (2) the role of the EDC; (3) advanced meter standards; and (4) customer education. While there is substantial disagreement regarding the unbundling of metering, those commenting generally agreed on (1) the Legislative intent of the act; (2) the need for meter standards; (3) the requirement that customers elect to have enhanced metering; and (4) the need for customer education.

Bundling vs. Unbundling of Advanced Metering

   ITRON, PEA, Penn Power, PECO, GPU, PP&L, IBEW, Dale Dix and Thomas Tamski are opposed to the unbundling of metering. Environmentalists, ENRON, PRA, IECPA, SEL and OTS support the unbundling of metering. ITRON, PEA, CellNet and IECPA indicate that the intent of the act is in its title. Transmission and distribution should remain regulated and only generation should be deregulated. IECPA notes, however, that metering should be unbundled only to the extent practicable without endangering safety and reliability. ENRON believes that metering is not part of the utility energy delivery system and accordingly should be subjected to competition.

   CellNet is neutral and indicates that the unbundling of metering is a potential consideration, but is not a necessary means to implement customer choice of alternate services. OCA states that the act does not specifically require that metering services performed by EDCs be unbundled and subjected to competition. Both CellNet and OCA suggest that the Commission could explore unbundling options. OCA emphasizes that the Commission is mandated to maintain the same level of quality of service under retail competition. IBEW pointed out that the act should not be read without taking other statutory provisions into consideration and noted that public utilities have duties relating to services and facilities under Chapter 15 of the Public Utility Code.

Advanced Meter Deployment

   ITRON cautions that an assessment of information requirements for direct access must be made by the EDC prior to implementation of any advanced meter network system. ITRON believes that advanced meter network systems are the most effective solutions to meeting the requirements of direct access. ITRON and CellNet believe that EDCs should be encouraged to offer these types of systems. CellNet and OCA note, however, that any incremental costs should be borne by those who benefit from advanced metering directly, and not spread across the entire ratebase. PEA indicates that advanced metering services are currently available from the EDC.

   Regarding advanced meters, all commenters agree that only customers desiring the technologies in order to participate in certain programs offered by suppliers should be required to pay any associated incremental costs. Customers who do not desire advanced meters should not be required to undertake this activity. IBEW notes that the act does not authorize customers to purchase their own meters. Rather, IBEW asserts that the act merely authorizes EDCs to charge customers for the installation of special metering equipment.

Advanced Meter Standards

   All commenters agree that standards for advanced meters are essential regardless of the decision to unbundle metering or to maintain the status quo. All agree that Chapters 56 and 57 of our regulations should remain, §§ 56.1--56.231, 57.1--57.141, and that ANSI C12 Standards should be followed for hardware and performance specifics.

   CellNet adds that advanced meters must be capable of supporting the expected minimum market requirement of hourly usage collected daily. Standards are needed to require all advanced meters to deliver the minimum level of functionality or to have the capability of being upgraded to perform these functions without requiring the replacement of the meter.

   SEL suggests that the Commission should support both: (1) performance standards, in the form of minimum functional requirements; and (2) product specifications in the form of accuracy requirements. SEL maintains that minimum accuracy requirements already exist and minimum functional requirements for advanced meters could include the ability to (1) record and save profiles; (2) modify profile intervals; (3) provide open communications; (4) provide a standard data format; (5) provide a communications port for the customer to monitor electric usage; (6) provide a pulse output to allow for usage monitoring; (7) provide password protection; and (8) provide multiple callout capability.

EDC Responsibilities Regarding Advanced Metering

   As previously discussed, both the act and other provisions of the Public Utility Code place responsibilities on the EDC or the jurisdictional public utility with regard to metering and metering services. ITRON, PEA, PECO, GPU, PP&L and IBEW indicate that EDCs should retain control of all metering services as envisioned in the act.

   PEA cites numerous reasons for EDC control including equal access to low-cost metering; consistency from customer to customer; direct control and responsibility for reliability, accuracy and maintenance standards; regulatory protection; expertise in metering; public safety; and scale economies in providing various meter services. In addition, EDCs will be the only constant in an environment where suppliers will enter and exit the marketplace as conditions dictate. ITRON indicates that EDCs should continue to play the same role as they now perform regarding meter acquisition, meter installation, meter reading, meter repair and determination of meter accuracy. Likewise, IBEW argues that EDCs are the only entities authorized to provide metering services under the act and Public Utility Code. OCA advocates that the Commission must set forth minimum and continuing obligations of the EDCs.

   Conversely, IECPA, ENRON and PRA indicate that metering should be unbundled. ENRON states that EDCs' responsibilities should: (1) establish minimum data elements, data flows, in collaboration with other interests for planning and operating the distribution system; and (2) compete in the marketplace to provide advanced metering services. Many parties indicate that the EDC should be encouraged to offer advanced metering services but condition that recommendation with the caveat that only parties that benefit from advanced metering should be required to pay for the advanced metering.

Advanced Metering Agreements

   PEA, PECO, PP&L, Thomas Tamski, CellNet, SEL, ENRON, Environmentalists and OTS support advanced metering agreements to ensure the fulfillment of procedures and standards. PEA maintains that the EDC has ultimate responsibility to ensure that standards are met. CellNet and Environmentalists add that the Commission should be the party to hear appeals and resolve disputes.

Informal Complaint Procedures

   Several commenters including PEA, OCA, IECPA, CellNet, OTS and Environmentalists, indicate that metering should be maintained at the same level of quality under retail competition. CellNet believes that the Commission should be the party to hear appeals and resolve disputes. Environmentalists indicate that a mechanism should be developed to settle discrepancies. OTS notes that the Commission must ensure that suppliers do not take advantage of customers.

Customer Education on Advanced Meters

   All commentators agree that customer education on advanced metering is essential. PEA states that EDC programs will address customer education needs. GPU notes that EDCs will likely use bill inserts, brochures, radio spots and similar approaches. PP&L will likely use a consumer handbook, workshops, adult education workshops and audiotapes. OCA agrees that the EDC should inform customers that they have an option to purchase or lease an alternative meter if the meter meets Commission standards.

   CellNet, SEL and Environmentalists agree that the Commission should develop a general education effort as an independent source. SEL believes that the Commission should review and monitor the activities of EDCs and suppliers. ENRON argues that meter companies should educate customers about service programs.

Conclusions

   The Commission concludes that the commencement of generation competition offers substantial opportunities for expanded generation products that may require the use of specialized metering equipment, and that it is necessary at this time to facilitate the expanded use of specialized metering. However, the Commission also concludes that advanced metering is not an essential requirement for all customers to participate in the competitive generation market at this time. Different consumers will require the use of different types of advanced metering equipment to meet their needs. For these reasons, it is inappropriate and unnecessary to require the universal deployment of any particular type of advanced metering equipment or networks. Those consumers and suppliers choosing to use advanced metering equipment should pay for any incremental cost thereby incurred.

   The Commission does not believe that it is necessary at this early stage of electric generation competition to unbundle metering from distribution services in order to facilitate the availability of advanced metering to meet consumer needs. Perhaps unbundling of metering services will be appropriate in the future, after market participants have had an opportunity to gain experience in the primary industry change to competitive generation markets.

   Instead, the Commission concludes that metering should remain a regulated function of the EDC at this time. Metering can remain a regulated function of the electric distribution utility, retaining all existing requirements and procedures for meter installation, reliability, safety, accuracy and the like. However, the choice of generation supplier is inherently connected with the opportunity for customers and suppliers to choose any type of advanced metering equipment that is necessary to support new generation services that will be available in the market.

   We conclude that this approach is consistent with the expectations in the act that the Commission support the development of competitive markets and the availability of resulting consumer benefits while retaining customer service in general, and metering in particular, commensurate with existing service quality as a local distribution function.

Bundling vs. Unbundling of Advanced Metering

   It is clear that viewpoints on whether metering should be unbundled remain polarized. Opponents of unbundling argue that EDCs should continue to control all meter services due to the language and Legislative intent of the act, safety/reliability concerns and other provisions of the Public Utility Code. They assert that the act mandates that EDCs and the Commission ensure that service will not deteriorate. Proponents of unbundling indicate that metering should be open in order to promote development of the competitive market at this time.

   We cannot accept either view. The purpose of the act is to permit all Pennsylvania retail electric customers to have direct access to a competitive generation market while obtaining the benefits of expanded services and simultaneously enjoying continued reliable and safe electric distribution service. The act does not require unbundling of metering at this time, but certainly anticipates that unbundling may occur in the future.

   We, therefore, conclude that metering can remain a regulated local distribution function at this time while providing substantial opportunities for customer and supplier introduction of advanced metering equipment and the associated expansion of generation services. This proposed rulemaking is intended to establish a set of uniform standards, procedures and requirements that can evolve over time as the competitive market develops: Thus, at this time, (1) customers should be permitted to choose an advanced meter provider while (2) all physical activity related to the advanced meter must be the responsibility of EDC employes as a local distribution function. Given these basic premises, we envision the following regulations:

Advanced Meter Deployment § 57.253

   The EDC shall retain all existing functions related to metering, including selection and deployment of basic meters for all customers not selecting an advanced meter. If an EDC seeks to deploy network equipment, procedures must be adopted to ensure coordination with the need for and use of advanced metering equipment in the market. We encourage the integration of new technologies into the marketplace and will monitor the trends.

   Advanced meters must meet appropriate standards and be compatible with other functional requirements of EDCs or suppliers. A network for automated meter reading capability, to be deployed by the EDC, must meet the same concerns. A network should be qualified as discussed in the next section. If an EDC seeks to collect a supplemental charge under section 2807(a) of the act , the Commission must approve a tariff change. The following information should be provided through the tariff filing and/or the qualification recommendation: a description of the network system; implementation timeframe; demonstration of compliance with applicable standards; implementation costs; impacts on customer bills and other existing and anticipated customer metering equipment and generation services; educational materials introducing the new metering technology; and the proposed tariffs concerning any charges for deployment of the network.

   In addition, a customer shall have the opportunity to choose a qualified advanced meter to support the generation services provided by its chosen supplier. In order to facilitate the deployment of advanced meters and to avoid the time and expense of multiple decisions and negotiations concerning advanced metering, the Commission will establish a Metering Committee (Committee) to assist the Commission in identifying qualified advanced meters and to establish procedures for implementation. The Committee shall be appointed and chaired by the Office of the Executive Director and comprised of representatives of EDCs and suppliers, as well as consumer and environmental interests. The Committee shall submit a Report to the Commission on or before September 1, 1998, and at least annually thereafter with its considerations and recommendations to the Commission.

   The Committee shall seek to develop a catalog of qualified advanced meters, including networks as applicable that include a variety of technologies to support the demands of consumers and the services of suppliers expected in the market. While we expect that these technologies primarily will concern automated meter reading and advanced communication capabilities, they also should include other technologies as appropriate for load management, net metering for self-generation and other services.

   Since not all consumers will use advanced meters at this time, and different advanced meters impose different costs and benefits, we do not believe that it is appropriate at this time to fund advanced metering through regulated rates paid by all customers. Instead, the EDC should be reimbursed for any net incremental costs incurred to provide the advanced metering. We note that the initial acquisition of an advanced meter certainly involves an additional expense, but that the expenses may be at least in part offset by reduced EDC expenses for meter reading, billing, normal change out and similar avoided EDC functions. We do not envision authorizing advanced meter surcharges that do not consider the offsetting costs.

   Since the EDC will continue to be responsible for all metering services other than the selection of the meter, there is no reason to consider at this time issues as who should own the meter or pay an acquisition cost. The EDC shall own and pay the acquisition cost, although the customer and/or supplier shall be responsible for any net incremental costs incurred by the EDC. The customer and supplier may agree to share these costs as they deem appropriate. If the customer is to pay the costs directly, we assume that the basic method shall be in the form of a monthly bill surcharge. If the supplier is to pay the cost, perhaps a single payment would be preferable. The Committee should consider and recommend EDC reimbursement procedures that will be resolved by the Commission when it considers the applicable tariff of each EDC.

   We believe that these provisions will ensure that customers will have the flexibility to choose an advanced meter while retaining metering as a regulated local distribution function and assuring EDC accountability for the safety and reliability of the distribution system without deterioration.

Advanced Meter Standards § 57.254

   Advanced meters and network systems shall, at minimum, conform to existing standards for accuracy and safety including all existing Commission regulations, and ANSI C12 Standards or as these standards may be amended.

   It is not appropriate for the Commission to adopt rigid standards for advanced metering at this time, as the market and available technologies are certain to evolve considerably in the coming years. Instead, the proposed regulations are designed to adopt a flexible set of standards that will be adopted by the Commission from time to time as requirements based on the recommendations of a working Meter Committee composed of representatives of interested groups. We believe that an advanced meter or network must possess, at minimum, open, nonproprietary communications capabilities, which allow both a supplier and EDC to access the information in a standard data format with multiple callout capability, unless the qualified advanced meter is to be used in conjunction with a second meter. In addition, a qualified advanced meter must be capable of supporting the expected minimum market requirement of hourly usage and may support one or more other functional requirements such as the ability to: (1) modify profile intervals; (2) provide a communications port for the customer to monitor usage; (3) provide a pulse output to allow for usage monitoring; (4) provide password protection; and (5) operate in two directions for net metering.

   For purposes of this proposed rulemaking, we believe that a meter which meets these minimum requirements shall be considered a qualified advanced meter subject to applicable surcharges and requirements of this subchapter.

   We will periodically review and revise these requirements, as necessary, to reflect changes in technology and infrastructure that may occur in the restructuring of electric utility service in general. For purposes of this proposed rulemaking, we request comments on these general standards.

EDC Responsibilities Regarding Advanced Metering § 57.255

   Because we conclude that it is not necessary to unbundle metering at this time, an employe of the EDC shall continue to be responsible for all activity relating to metering such as setting meters, testing, calibrating, change-out, energizing and the like.

   An employe of the EDC must install and make operational a qualified advanced meter within 15 business days of the request to do so. The EDC must develop a procedure for ensuring the availability of qualified advanced meters as required. For example, an EDC could keep an inventory of meters as it does for other equipment or arrange with other suppliers and EDCs for more economic and efficient ways to ensure availability.

   Since most forms of advanced metering provide opportunities for advanced generation services, the supplier must have complete access to automated meter reading. A supplier must be permitted directly to obtain automated meter readings as it requires, either in addition to or instead of the EDC reading. However, physical meter reading must be provided by an employe of the EDC as part of its local distribution service. The EDC shall comply with § 56.12(5)(ii) concerning physical readings to verify the accuracy of automated meter readings.

   In order to encourage the deployment of advanced technologies on a systemwide basis, we may, at an appropriate time in the future, require EDCs to install advanced meters or networks. The Commission will remain flexible to address situations as they develop in the marketplace.

   We believe these provisions to be consistent with the Legislative intent of the act to ensure that meter services are maintained at the same level of quality under a competitive generation supply environment.

Disputes Concerning Advanced Meters § 57.256

   Disputes and operational issues concerning advanced metering are likely to develop in the early years and diminish over time. The Meter Committee provides an ideal forum for addressing these issues in the first instance.

   Unresolved disputes or operational problems concerning advanced metering between an EDC and a supplier may be referred to the Office of Administrative Law Judge for resolution using alternative dispute resolution, if possible, or through other proceedings as may be necessary. Upon the request of the Office of Administrative Law Judge, technical staff shall provide the technical expertise as is necessary to resolve disputes related to advanced metering. Disputes between an EDC and a residential or small commercial customer, or between a supplier and a residential or small commercial customer, may be filed with the Bureau of Consumer Services for mediation and dispute resolution consistent with existing Commission regulations.

   If a customer, applicant or other interested party expresses dissatisfaction with an EDC or supplier response regarding advanced metering, the EDC or supplier must inform that person of the right to have the problem considered and reviewed by the Commission as an informal or formal complaint. The EDC or supplier shall explain how to file a complaint and otherwise comply with applicable regulations.

Record Retention and Reporting Requirements § 57.257

   We will monitor deployment of all advanced meters or networks. In order to fulfill our statutory responsibility to ensure that service quality does not deteriorate and to hold EDCs accountable for their activities in this regard, we propose in these regulations that EDCs retain certain records and submit summary reports to us by April 1 of each year. We specifically seek comments concerning the content of these records and reports and whether there are other ways to address the Commission's responsibilities in this regard.

   For the purpose of this proposed rulemaking and comments thereon, we propose that EDCs retain the following information in summary form for Commission staff review:

   (1)  Updated lists of all qualified advanced meters;

   (2)  General summary of procedures for advanced meter acquisition and installation;

   (3)  Date of advanced meter purchase request by customers or suppliers and date of installation;

   (4)  Summary of qualified advanced meters deployed, including the name of manufacturer and serial numbers;

   (5)  Summary of characteristics and capabilities of each qualified advanced meter;

   (6)  Summary of operational problems experienced and how resolved;

   (7)  Summary of educational activities concerning advanced metering in general and specific qualified advanced meters;

   (8)  Summary of advanced meter network activity; and

   (9)  Any other information deemed appropriate.

   The proposed regulations would require that EDCs file a report including the above information by April 1 of each calendar year. EDCs should also retain customer terms of service disclosure statements which include advanced metering provisions as provided in § 57.258.

   The summary information will assist us to fulfill our statutory obligation to protect the customer and ensure that service quality does not deteriorate. This requirement will hold EDCs accountable for all metering activities including: advanced metering development; advanced meter selection and installation; advanced meter network deployment; and appropriate customer education. We will provide oversight to ensure that barriers to technological advances do not develop in the future.

Customer Education on Advanced Metering § 57.258

   The manner in which customers perceive the changes to a competitive market will determine whether they choose to exercise choice. Customers will be required to choose whether to keep their current spinning disk meter or opt for an advanced metering system.

   In general, residential customers now pay little attention to the function of their electric meter. In order to make an informed decision to keep the standard meter or change to an advanced meter, customers will have to compare advantages and disadvantages. For customers to understand and have confidence in their choices, customers must have the skills and knowledge to gather and use information wisely, and to track their electric usage effectively. Customers should have knowledge before installation of an advanced meter or participation in a specialized generation services program offered by a supplier.

   To help ensure that prospective customers are aware of these implications, EDCs and suppliers must ensure that customers are informed as to the capabilities, advantages and disadvantages of an advanced meter prior to installation or participation in a generation service program utilizing advanced metering.

   The terms of service disclosure statement anticipated to be required under the Customer Information Disclosure for Electricity Providers Proposed Rulemaking Order entered on November 7, 1997 at Docket No. L-00970126 is an ideal method for ensuring that the information is provided. An EDC or supplier must provide terms of service disclosure statements in compliance with the final rules adopted in that docket. Including metering information in the disclosure statement can help ensure that customers were provided all applicable information pertaining to advanced metering service and fees.

   As part of its customer education responsibilities, an EDC must provide educational materials to all customers addressing the capabilities, advantages, disadvantages and fees of an advanced meter including how to obtain more information, and dispute procedures.

   In order to fulfill our Legislative mandate to ensure that the level of quality regarding metering services will not deteriorate in this Commonwealth, we propose to amend our regulations to read as set forth in Annex A, and establish metering deployment and customer selection procedures, meter standards and education strategies for customers choosing to participate in certain generation supply programs which require advanced metering capability. Accordingly, under sections 501 and 2807(a) and (d) of the Public Utility Code, 66 Pa.C.S §§ 501 and 2807(a) and (d), and the act of July 31, 1968 (P. L. 769, No. 240) (45 P. S. § 1201, et seq.) and the regulations promulgated thereunder at 1 Pa. Code §§ 7.1--7.4, we propose to amend the regulations at 52 Pa. Code Chapter 57, as noted above and to read as set forth in Annex A; Therefore,

It Is Ordered That:

   1.  A rulemaking docket shall be opened pertaining to advanced meters for electricity providers to read as set forth in Annex A.

   2.  The Secretary shall certify this order and Annex A and deposit them with the Legislative Reference Bureau for publication in the Pennsylvania Bulletin.

   3.  Interested parties may submit written comments, an original and 15 copies to the Office of Prothonotary, Pennsylvania Public Utility Commission, P. O. Box 3265, Harrisburg, PA 17105-3265, within 30 days from the date this order is published in the Pennsylvania Bulletin. A copy of written comments shall also be served upon the Commission's Bureau of Conservation, Economics and Energy Planning.

   4.  The Secretary shall submit this order and Annex A to the Office of Attorney General for preliminary review as to form and legality.

   5.  The Secretary shall submit this order and Annex A to the Governor's Budget Office for review of fiscal impact.

   6.  The Secretary shall submit this order and Annex A for review by designated standing committees of both Houses of the General Assembly, and for review and comments by IRRC.

   8.  That the contact persons for this matter are Charles F. Covage, Bureau of Conservation, Economics, and Energy Planning, (717) 783-3835 (technical) and Stephen Gorka, Law Bureau (717) 772-8840 (legal).

JAMES J. MCNULTY,   
Secretary

Statement of Vice Chairperson Robert K. Bloom

   Before the Commission for consideration is a proposed rulemaking on Advanced Meter Deployment for Electricity Providers which proposes amendments to 52 Pa. Code Chapter 57. The purpose of this proposed rulemaking is to establish uniform procedures and standards for the deployment and customer selection of advanced meters and electric distribution company installation of advanced meter networks which may be required under the Electricity Generation Customer Choice and Competition Act (''Act''). Comments from interested parties addressing the various proposals within these regulations are requested and are due within 30 days from the date this order is published in the Pennsylvania Bulletin. I encourage parties to comment on this proposal and specifically request that commentators consider my concerns with this rulemaking as delineated below.

   The issue of whether the function of metering should be unbundled and performed on a competitive basis is a threshold issue of the transition to a competitive electric generation market that has yet to be considered by this Commission. The Act neither specifies that metering should be unbundled or that it should remain a regulated distribution function. Section 2804(3) of the Act specifies that the Commission shall require unbundling to separate the charges for generation, transmission and distribution, and that ''The Commission may require the unbundling of other services.'' Pursuant to Section 2807(a) of the Act, subject to Commission approval, the Electric Distribution Company (''EDC'') may require that the customer install, at the customer's expense, enhanced metering capability sufficient to match the energy delivered by the suppliers with consumption by the customer.

   The proposed Order states that the Commission concludes that metering should remain a regulated function of the EDC at this time, that the choice of generation supplier is inherently connected with the opportunity for customers and suppliers to choose any type of advanced metering equipment that is necessary to support new generation services, and that those consumers and suppliers choosing to use advanced metering equipment should pay for any incremental cost thereby incurred. This recommendation proposes that the EDC shall own and pay the acquisition cost of advanced meters, but sets up a tariffed surcharge mechanism which the EDC could implement to be compensated for any net incremental costs. I request commenter's opinions on whether this approach is consistent with the Act, consistent with a competitive generation market and the most administratively efficient procedure to accomplish advanced metering.

   I am also concerned about the significance of the language contained in several sections of the proposed regulations. Specifically, Section 57.252. Advanced meter deployment and Section 57.254. EDC responsibilities regarding advanced metering contain language whereby employees of the EDC are responsible to install, calibrate, maintain, test and physically read advanced meters. However, no definition of an EDC employee is contained in the proposed regulations. While I do not believe that this rulemaking docket is the proper place to address this issue, a majority of the Commissioners have decided otherwise. I request commentators opinions on the ramifications of this language and whether such restrictions are consistent with a competitive generation market.

   Because of the above concerns, I vote to concur in the result only of this rulemaking strictly for the purpose of soliciting comments on the proposed regulations.

   Fiscal Note:  57-190. No fiscal impact; (8) recommends adoption.

Annex A

TITLE 52.  PUBLIC UTILITIES

PART I.  PUBLIC UTILITY COMMISSION

CHAPTER 57.  ELECTRIC SERVICE

Subchapter O.  ADVANCED METER DEPLOYMENT

Sec.

57.251.Purpose.
57.252.Definitions.
57.253.Advanced meter deployment.
57.254.Advanced meter standards.
57.255.EDC responsibilities regarding advanced metering.
57.256.Disputes concerning advanced metering.
57.257.Record retention and reporting requirements.
57.258.Customer education on advanced metering.

§ 57.251.  Purpose.

   The purpose of this subchapter is to facilitate the deployment of advanced metering equipment and the associated development of generation services based on these technologies. This subchapter will establish a procedure for identifying and providing for customer selection of qualified advanced meters and deployment of automatic meter reading network equipment from the electric distribution company while maintaining the safety and reliability of the electric system in this Commonwealth.

§  57.252.  Definitions.

   The following words and terms, when used in this subchapter, have the following meanings, unless the context clearly indicates otherwise:

   Advanced meter network or network--A communications infrastructure installed in conjunction with an existing electronic watt-hour meter which allows for automated meter reading and other services.

   Advanced meter standards--A set of general guidelines which define minimum compatibility, accuracy and functional requirements for an advanced meter.

   Commission--The Pennsylvania Public Utility Commission.

   EDC--electric distribution company--An electric distribution company as defined by 66 Pa.C.S. § 2803 (relating to definitions).

   Electric generation supplier or electricity supplier--An electricity supplier as defined by 66 Pa.C.S. § 2803.

   Multiple callout capability--A function which permits advanced meters to call more than one telephone number to report electric usage information.

   Qualified advanced meter--An electronic watt-hour meter identified through the process established under this subchapter that supports the provision of generation services in a competitive market and meets certain advanced meter standards.

   Retail electric customer or customer--A direct user of electric power as defined by 66 Pa.C.S. § 2803.

   Small commercial customer--An individual, partnership, corporation, association or other business entity which employs fewer than 250 employes and which receives public utility service under a small commercial, small industrial or small business rate classification.

§ 57.253.  Advanced meter deployment.

   (a)  Upon written request from both a customer and the generation supplier of that customer, an employe of the EDC shall install and make available for use any qualified advanced meter.

   (b)  A qualified advanced meter shall be one approved by the Commission according to the following process:

   (1)  The Office of the Executive Director shall appoint and chair a Metering Committee (Committee) composed of representatives of EDCs and suppliers, as well as representatives of consumer and environmental interests.

   (2)  The Committee shall meet as necessary in order to establish and modify from time to time recommendations to the Commission for a catalog of qualified advanced meters. The Committee shall seek to include in the catalog a variety of technologies that support the demands of customers and the services of suppliers expected in the market. These technologies may include: networks, two-way communication, time of use capabilities, load management, net metering for self-generation and similar services. Qualified advanced meters shall meet the standards in § 57.254 (relating to advanced meter standards).

   (3)  The Committee shall submit a report to the Commission by September 1, 1998, and at least annually thereafter, with its considerations and recommendations.

   (c)  Consumers and suppliers shall be responsible for any net incremental costs incurred by the EDC as a result of using a qualified advanced meter.

   (1)  Consumers using a qualified advanced meter may be assessed a bill surcharge by the EDC to cover net incremental costs associated with the choice to use an advanced meter, such as physical installation, meter reading and maintenance.

   (2)  In lieu of a customer surcharge, the supplier may pay the EDC for net incremental costs.

   (3)  The customer and supplier may mutually agree to allocate these charges between them.

   (d)  The Committee shall include in its reports to the Commission facts concerning the anticipated net incremental costs of any qualified advanced meters and any recommendations concerning the appropriate level and manner of payment of these charges.

   (e)  A customer surcharge or supplier payment for qualified advanced meters shall be incorporated in a tariff of each EDC approved by the Commission.

   (f)  An EDC may deploy a network for automatic meter reading capability provided that the following conditions apply:

   (1)  The network is compatible with market requirements as a qualified advanced meter based on the Metering Committee review and recommendations as adopted by the Commission.

   (2)  The application includes proposed tariffs concerning any charges for deployment of the network.

   (3)  The application includes, at a minimum:

   (i)  A description of the system.

   (ii)  Implementation time frame.

   (iii)  Certification on compliance with applicable standards.

   (iv)  Implementation costs.

   (v)  Summary of educational materials on the new technologies.

   (vi)  Impacts on customer electric bills.

   (vii)  Impacts on existing and anticipated advanced metering equipment and generation services.

§ 57.254.  Advanced meter standards.

   (a)  An advanced meter and a network shall conform to existing regulations contained in §§ 57.20--57.25 and American National Standards Institute Standard C12 or as these standards may be amended.

   (b)  A qualified advanced meter and a network shall meet standards adopted by the Commission from time to time after consideration of the recommendations of the Metering Committee. All qualified advanced meters or networks should possess open, nonproprietary communications capabilities which allow both a supplier and EDC to access information in a standard data format, with multiple call-out capability, unless the qualified advanced meter is to be used in conjunction with a second meter. In addition, a qualified advanced meter shall be capable of measuring hourly usage, and may support one or more functional requirements, such as the ability to do one or more of the following:

   (1)  Modify a profile interval.

   (2)  Provide a communications port for a customer to monitor usage.

   (3)  Provide a pulse output to allow for usage monitoring.

   (4)  Provide password protection.

   (5)  Operate in two directions.

   (c)  A meter that meets requirements provided in subsections (a) and (b) shall be considered a qualified advanced meter and subject to applicable surcharges and other requirements of this subchapter. The Commission will periodically review and revise these requirements as necessary.

§ 57.255.  EDC responsibilities regarding advanced metering.

   (a)  A qualified advanced meter shall be owned and operated by the EDC as part of its regulated local distribution function. An employe of the EDC shall be responsible for compliance with all applicable requirements related to installation, calibration, maintenance, testing, physical reading, safety and reliability.

   (b)  A supplier serving the customer may perform automated meter reading activities.

   (c)  An employe of the EDC shall install and make operational a qualified advanced meter within 15 business days from the date the request is received by an EDC.

   (d)  An employe of the EDC shall physically read an automated meter in compliance with § 56.12(5)(ii) (relating to meter reading; estimated billing; ratepayer readings).

   (e)  The EDC shall develop a protocol that ensures that qualified advanced meters are available for installation as required in this subchapter. The EDC may purchase and stock the meters, or may otherwise arrange with suppliers and other EDCs for the most economical way to ensure availability.

§ 57.256.  Disputes concerning advanced metering.

   (a)  Disputes or operational problems between suppliers and EDCs concerning the use of advanced metering shall in the first instance be brought forward for review and resolution, to the extent possible, by the Metering Committee.

   (b)  An unresolved dispute or operational problem concerning advanced metering between an EDC and a supplier may be referred to the Office of Administrative Law Judge for resolution using alternative dispute resolution, if possible, or through other proceedings as may be necessary. Upon the request of the Office of Administrative Law Judge, Commission staff will provide technical expertise as is necessary to resolve a dispute related to advanced metering.

   (c)  A dispute between an EDC and a residential or small commercial customer, or between a supplier and a residential or small commercial customer, may be filed as an Informal Complaint with the Bureau of Consumer Services for mediation and dispute resolution consistent with this title.

   (d)  When a customer, applicant or other interested party expresses dissatisfaction with an EDC or supplier decision or explanation of its actions covered by this subchapter, the EDC or supplier shall inform the customer, applicant or other interested party of the right to have the problem considered and reviewed by the Commission as an informal or formal complaint. The EDC or supplier shall explain how to file the complaint and otherwise comply with §§ 3.111, 3.112 and §§ 56.161--56.224.

§ 57.257.  Record retention and reporting requirements.

   (a)  An EDC shall maintain the following records:

   (1)  Updated lists of all qualified advanced meters.

   (2)  General summary of procedures for advanced meter acquisition and installation.

   (3)  The date of advanced meter purchase request by customer and supplier and date of installation.

   (4)  The summary of qualified advanced meters deployed, including name of manufacturer and serial numbers.

   (5)  The summary of characteristics and capabilities of each qualified advanced meter.

   (6)  The summary of operational problems experienced.

   (7)  The summary of educational activities concerning advanced metering in general and specific qualified advanced meters.

   (8)  The summary of advanced meter network activity under this subchapter.

   (9)  Other information deemed appropriate.

   (b)  An EDC shall submit to the Commission an annual Report by April 1 of each year including the information required under subsection (a).

   (c)  An EDC and supplier shall retain an executed customer terms of service disclosure statement which includes advanced metering provisions as provided in § 57.258 (relating to customer education on advanced metering) and shall be available for Commission review upon request.

§ 57.258.  Customer education on advanced metering.

   (a)  The supplier shall ensure that a customer is informed as to the capabilities, advantages and disadvantages of a qualified advanced meter prior to installation or participation in a generation service program utilizing advanced metering.

   (b)  An EDC and supplier shall provide a terms of service disclosure statement that covers advanced metering.

   (c)  An EDC shall provide consumer education as part of its consumer information program addressing the capabilities, advantages and disadvantages of advanced metering, including qualified advanced meter options, applicable costs/surcharges, meter operations and capabilities, how to obtain more information, and dispute procedures.

   (d)  An EDC shall comply with § 57.257 (relating to record retention and reporting requirements).

[Pa.B. Doc. No. 98-169. Filed for public inspection January 30, 1998, 9:00 a.m.]


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