Public Benefits Charges.
1. As part of implementing electric utility restructuring in Virginia, should the General Assembly establish any rate subsidy and/or energy efficiency assistance programs for low-income households?
The Cooperatives neither support nor oppose a rate subsidy and/or energy efficiency assistance program for low-income households. Such programs present broad policy issues, the implications of which must be fully evaluated by the Virginia General Assembly. The legislature must recognize that if programs such as these are established, additional costs will be added to consumers' electricity bills, since these programs are not in place today. As policymakers weigh this decision they must consider all of the other additional costs that will accompany retail competition (e.g., creating an ISO and RPX, consumer education, etc.) and determine whether those required costs plus any other added optional costs will exceed the savings a competitive generation market may provide.
2. How should any such program(s) be structured in terms of eligibility?
The Cooperatives can claim no expertise regarding decisions on eligibility for social programs. State agencies that regularly deal with such issues should be consulted regarding eligibility criteria, and the information obtained should be provided to legislators, the SCC and the stakeholders in this process.
3. How should any such program(s) be funded?
If such programs are established, they should be funded by a non-bypassable distribution wires charge that would be paid by all customers.
4. How should any such program(s) be administered?
The administration of programs such as these would have to be coordinated between state agencies that deal with social and welfare issues, the SCC and the appropriate utility.
5. Are there any programs that could or should serve as an alternative or supplement to any such programs? If so, describe.
The state currently has programs that assist those in need with paying their electricity bills during the winter.
6. Please identify any other issue(s) falling under this topic you believe are important, and provide comments on that issue.
As stated in response to Question No. 1, the Cooperatives believe that policy makers should look closely at all the new cost which must be borne as a result of moving to a competitive structure and ensure that they are not laying the groundwork for higher rates to millions of residential rate payers.
Consumer Education.
7. What should be the general purpose of any consumer education program preceding and accompanying Virginia's transition to retail competition?
The general purpose of a consumer education program should be to inform electricity users how the retail competition program will work and how they can participate in it.
8. When should these programs be conducted?
These programs should commence three to four months prior to consumers being eligible to choose their power supplier. If pilots are to be done, consumer information in the pilot areas should also be done in the same preceding time frame.
9. Who, if anyone, should have regulatory oversight over such programs?
The State Corporation Commission should have whatever regulatory oversight authority over these consumer education programs is necessary.
10. Which state regulatory agencies, if any, should participate in this program, and in what capacity?
State regulatory agencies, particularly the SCC, should participate in the development of education programs, first as a facilitator and later as a sponsor. In order to "neutralize" the message, the SCC must have a role in the development of educational programs.
11. How should such programs be funded?
Consumer education program should be funded through a non-bypassable distribution wires charge that would be paid by all consumers.
12. Should any long-term consumer education program be established, to continue after the transition to retail competition is completed? If so, describe its scope, oversight and funding.
No. In protecting the public interest, the SCC may be empowered to review advertising for fraudulent or misleading offers, but an ongoing education program is not needed once the retail program is in place and consumers have been fully informed as to how it will operate.
13. Please identify any other issue(s) falling under this topic you believe are important, and provide comments on that issue.
Consumer education programs should be broad and general. Consumers should have the opportunity to learn something about the electric power business and how changes in that business will affect them. However, efforts to influence peoples' opinions as to which power supplier to choose should be left to the advertising and promotional materials prepared by the seller.
Customer Aggregation.
14. Should customer aggregation be permitted in Virginia in conjunction with restructuring?
Yes. Aggregation may be the only hope residential consumers will have of benefiting from competition. The Cooperatives currently are aggregators for their members and intend to continue in that role for their members and for any other customers who would like to be served by a cooperative.
15. Should aggregators be subject to mandatory licensing by any regulatory authority, or be required to furnish evidence of financial soundness?
There should be some process for checking the background and financial stability of aggregators, but the process and the standards should not be so rigorous as to discourage "local" aggregation efforts. The structure of the aggregating entity and the role it plays in the process will influence how much oversight is needed.
16. Should aggregators be subject to any other requirements? If so, describe them.
Aggregators often will have obligations and responsibilities to those they serve, much as any other power supplier. Accordingly, they should meet comparable standards regarding the ability to deliver contracted power supply, reserves, etc.
17. Should localities (counties, cities or towns) be permitted to aggregate their residential load?
Yes, provided retail competition is being allowed in that municipal or locality.
18. Should localities be permitted to aggregate their residential load on an "opt out" basis?
No, this would be tantamount to state supported slamming. Cooperatives and municipals that are already acting as aggregators for their members and citizens should be permitted to continue in that role for those who choose not to switch suppliers. The opt-out aggregation proposal by localities would allow them to essentially take over current customers of existing utilities by simply declaring themselves aggregators.
19. Should localities be permitted to form inter-locality aggregates?
Yes.
20. Should localities be permitted to aggregate load with private entities outside their territorial jurisdiction?
If an established municipal electric utility begins to aggregate customers outside of its service territories it is entering competition and should be subject to reciprocity, i.e., others selling in its territory. If a locality has no established electric utility, its aggregation need not be limited by its corporate boundary.
21. Should localities be permitted to aggregate load with private entities or localities outside of Virginia?
While the aggregation may get more complex (more delivery points, various sources of generation) there is no reason such multi-state aggregation should be prohibited.
22. Please identify any other issue(s) falling under this topic you believe are important, and provide comments on that issue.
None.
Consumer protection.
23. Should electric service providers and aggregators be required to disclose standard information in their marketing materials, and in their proposals and contracts for service? If so, what basic information should be provided?
It will be difficult to prescribe specific language for inclusion in marketing materials; however, it may be beneficial to establish a generic comparison basis for rates, whereby each provider must apply its rates to a set formula to create an unambiguous rate comparison given a set of specific assumptions.
24. Should any kinds of marketing practices by electric service providers or aggregators be specifically prohibited? If so, what practices should be barred?
Any practice which is deceptive in nature, such as "contest" sign-ups whereby upon entering a contest the entrant (perhaps unknowingly) changes its electric supplier.
25. Should Virginia restructuring legislation establish limits on the size of utility service deposits that may be required by electric service providers and aggregators? If so, what limits should be established?
Service deposits should be limited to a reasonable amount under the circumstances. Deposit should not be so low that customers jump from one provider to the next nor so high that customer is effectively blocked from making changes.
26. What kinds of standard information should electric bills contain after restructuring? If so, what information should each bill be required to provide?
Bill should identify charges for each type of service or category of charge (e.g., transmission, distribution, power supply, ancillaries, transition, and public benefit) and identify which services are subject to competition.
27. Should Virginians be given any statutory rights to cancel utility service contracts with electric service providers or aggregators within a specified number of days following acceptance? If so, what special rights of recission or cancellation should be provided in statute?
Probably no need for special rights but should have the same recission rights as other in-home or telephonic solicitations (midnight of 3rd business day after agreement or offer).
28. Should Virginians be given any statutory protection against unauthorized switching of electric service providers, or "slamming?" If so, what anti-slamming protections should be adopted?
Yes. Any involuntary change in service provider should be prohibited. Supplier engaging in slamming should face loss of certification in state.
29. Should Virginians be given any statutory protection against any electric service provider or aggregator telemarketing practices? If so, what?
Current Virginia consumer protection laws should apply. No need for extraordinary or different protections.
30. Should consumers be furnished assistance by any state regulatory agencies in resolving complaints against electric service providers or aggregators? If so, which agencies should be involved, and what should their responsibilities include?
Yes. The SCC's regulatory responsibilities may be reduced through restructuring but new enforcement responsibilities should arise. Along with the SCC's new responsibility with regard to licensing should come additional authority with regard to investigating complaints and taking action on violations of licensing requirements.
31. Please identify any other issue(s) falling under this topic you believe are important, and provide comments on that issue.
None.
Environmental Protection.
32. Should Virginia restructuring legislation in any way promote or encourage the use of renewable energy in the generation of electricity? If so, how?
Once again, this is a policy issue to be decided by the Virginia General Assembly, albeit a thorny one. Currently, utilities are under no obligation to use renewable energy resources in generation. Since renewable resources are generally more expensive than other, more traditional generation resources, generation costs will be higher with a renewable energy resource requirement than they would be without such a requirement. This again raises the question of how many additional programs can be added in the name of restructuring before any benefits derived from competition will be wiped out.
33. Should Virginia restructuring legislation in any way address air quality, directly or indirectly? If so, in what way?
Yes, to the extent that Virginia legislation can address air quality issues and not be in conflict with federal statutes, Virginia should establish policies that recognize differences in the emissions from energy marketed in the Commonwealth. Virginia, with its nuclear generation, extensive gas generation and the new Clover Power station, is very low in emissions compared to many of the states to its west. In order for Virginia to compete fairly against resources that do not have the capital burden associated with extensive environmental controls, some recognition should be given to the lower environmental impact associated with its generation.
34. Should Virginia restructuring legislation require electric service providers or aggregators to disclose generation fuels? If so, how should this requirement be implemented and administered?
Yes, the generation fuels and emissions associated with those fuels should be disclosed by each entity supplying generation service to consumers in the Commonwealth. This program should be implemented and administered by the Virginia State Corporation Commission.
35. Please identify any other issue(s) falling under this topic you believe are important, and provide comments on that issue.
None.
Energy Efficiency.
36. Should Virginia restructuring legislation in any way promote or encourage energy conservation or energy efficiency, e.g., encouraging installation of energy efficient equipment or energy efficiency monitoring equipment? If so, what incentives should the legislation include?
No. Business is already flourishing in the conservation and energy efficiency field, completely independent of the action of the public utilities. There is no need to provide incentives to encourage what is already developing quite well on its own.
37. Should Virginia restructuring legislation establish a public benefits charge for the purpose of encouraging research and development in the areas of energy conservation and efficiency? If so, how should it be assessed and administered?
No, as stated in the previous answer, this field is developing very well on its own.
38. Please identify any other issue(s) falling under this topic you believe are important, and provide comments on that issue.
None.
Electric Utility Worker Protection.
39. Should Virginia's electric utility workers be given any statutory protections in conjunction with the transition to a retail competition? If so, what protections should be provided, and through what mechanism?
There need not be any direct, additional protections for workers; however, the costs of severance pay, job-finding assistance, retraining of workers displace because of regulatory changes should be allowed as recoverable transition costs in order to encourage utilities to offer such benefits.
40. If any statutory protections for utility workers result in additional costs or expense, how should they be funded?
Avoid statutory protections but allow "displaced employee" benefits to be collected through a non-bypassable wires charge to distribution customers.
41. Should providers of electric energy in a restructured market be required to maintain minimum staffing levels for purposes of reliability? If so, who should determine these levels, and what standards should be applied in doing so?
Providers of electric energy should maintain staffing levels for purposes of reliability but such levels should not be the product of a governmental mandate. Whatever system of regional reliability authorities develops in restructuring should be responsible for setting standards for reliable operation, with recourse to the appropriate state or federal regulatory authority.
42. Should the purchaser of any generation unit or station sold after restructuring, be required to (i) hire or continue the employment of such unit or station's employees, and (ii) furnish such employees the same wages, working conditions and benefits and terms and conditions of employment that were in effect prior to the sale?
No, any workers displaced as the result of asset sales should be treated the same as other electric utility workers displaced as the result of restructuring.
43. Should new entrants into Virginia's electricity market following restructuring be required to comply with any requirements concerning the qualifications of their electrical workers with regard to quality, safety and reliability of service? If so, who would establish such requirements.
All participants in Virginia's electricity market following restructuring should be required to comply with requirements concerning the qualifications of their electrical workers with regard to quality, safety and reliability of service. To the extent that there are any such standards, they should be applicable to all suppliers, not just new entrants. Any such standards should be left to professional associations or regional authorities.
44. Should Virginia, in conjunction with restructuring, establish mandatory training and skill standards for all electrical workers responsible for systems and equipment that affect system reliability and safety?
No. Again, professional associations or regional organizations should handle these sorts of training and standards.
45. Please identify any other issue(s) falling under this topic you believe are important, and provide comments on that issue.
None.