§ 69.1805. Electric generation supply procurement.
A proposed procurement plan should balance the goals of allowing the development of a competitive retail supply market and also including a prudent mix of arrangements to minimize the risk of over-reliance on any energy products at a particular point in time. In developing a proposed procurement plan, a DSP should consider including a prudent mix of supply-side and demand-side resources such as long-term, short-term, staggered-term and spot market purchases to minimize the risk of contracting for supply at times of peak prices. Short-term contracts are contracts up to and including 4 years in length. Long-term contracts are contracts more than 4 years in length but not more than 20 years. Long-term contracts of more than 4 years in length but not more than 20 years should not constitute more than 25% of the DSP’s projected load unless the Commission determines that a greater portion of load is necessary to achieve least cost procurement. The plan should be tailored to the following customer groupings, but DSPs may propose alternative divisions of customers by registered peak load to preserve existing customer classes.
(1) Residential customers and nonresidential customers with less than 25 kW in maximum registered peak load. Initially, the DSP should acquire electric generation supply for these customers using a prudent mix of resources as described in the introductory paragraph to this section. Contracts should be laddered to minimize risk, in which a portion of the portfolio changes at least annually, with a minimum of two competitive bid solicitations a year to further reduce the risk of acquisition at a time of peak prices. In subsequent programs, the mix percentage of supply acquired through long-term and short-term contracts and spot market purchases should be adjusted, depending on developments in retail and wholesale energy markets to ensure least cost to customers.
(2) Nonresidential customers with 25—500 kW in maximum registered peak load. The DSP should acquire electric generation supply for these customers using a mix of resources as described in the introductory paragraph to this section. Fixed-term contracts may be laddered to minimize risk, with a minimum of two competitive bid solicitations a year to further reduce the risk of acquisition at a time of peak prices. In subsequent programs, the mix percentage of supply acquired through long-term and short-term contracts and spot market purchases should be adjusted, depending on developments in retail and wholesale energy markets to ensure least cost to customers.
(3) Nonresidential customers with greater than 500 kW in maximum registered peak load. Hourly priced or monthly-priced service should be available to these customers. The DSP may propose a fixed-price option for the Commission’s consideration.
Source The provisions of this § 69.1805 adopted September 14, 2007, effective September 15, 2007, 37 Pa.B. 5019; amended February 24, 2012, effective February 25, 2012, 42 Pa.B. 1044. Immediately preceding text appears at serial pages (330093) to (330094).
Cross References This section cited in 52 Pa. Code § 69.1801 (relating to scope); 52 Pa. Code § 69.1802 (relating to purpose); and 52 Pa. Code § 69.1803 (relating to definitions).
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