ComEd 2013 Annual Report Download - page 25

competitive electric generation supplier was531,500 representingapproximately34% oftotal retailcustomers. Retaildeliveries
purchasedfromcompetitive electric generation suppliersrepresentedapproximately 68% of PECO’s retailkWh salesfor theyear
endedDecember 31,2013.Customersthat chooseacompetitive electric generation supplier are not subject to ratesfor PECO’s
electric supplyprocurement costsandretail transmission servicecharges. PECO presentson customer billsitselectric supplyPrice
to Compare, which is updatedquarterly, to assistcustomerswiththeevaluation ofoffersfromcompetitive electric generation
suppliers.
Customer choice programactivityaffectsrevenue collectedfromcustomersrelatedto suppliedenergy; however,that activityhasno
impact on electric revenue net ofpurchasedpower expenseorPECO’s financial position. PECO’s costofelectric supplyispassed
directlythrough to default servicecustomerswithout markup andthose ratesare subjecttoadjustment at leastquarterlyto recover
or refundthedifferencebetween PECO’s actual costofelectricitydeliveredandtheamount includedin ratesthrough theGSA.For
thosecustomersthat chooseacompetitive electric generation supplier, PECO actsasthebillingagent but doesnot recordrevenues
or purchasepower expense relatedto this electric supply. PECO remainsthedistribution service provider for all customersinits
service territoryandchargesaregulatedrate for distribution service.
Procurement Proceedings. PECO’s electric supplyfor itscustomersisprocuredthrough contractsexecutedinaccordancewithits
PAPUC-approved DSP Programs. PECO enteredinto contractswithPAPUC-approved bidders, includingGeneration,aspart ofits
DSP I competitive procurementsconductedsinceJune 2009for itsdefault electric supplybeginningJanuary2011, which included
fixedpricefull requirement contractsfor all procurement classes, spot market pricefull requirementscontractsfor thecommercial
andindustrial procurement classes, andblock energy contractsfor theresidential procurement class. InSeptember 2012, PECO
completeditslastcompetitive procurement for electric supplyunder itsfirstDSP Program, which expiredon May31,2013.
OnOctober 12,2012,thePAPUC approved PECO’s second DSP Program, which wasfiledwiththePAPUC inJanuary2012.The
plan outlineshow PECO is purchasingelectric supplyfor default servicecustomersfromJune 1,2013 through May31,2015.
Pursuant to thesecond DSP Program, PECO is procuringelectric supplythrough fivecompetitive procurementsfor fixedpricefull
requirementscontractsoftwoyearsor less for theresidential andsmall andmediumcommercial classesandspot market pricefull
requirement contractsfor the largecommercial andindustrial class load. InDecember 2012 andFebruary2013, PECO enteredinto
contractswithPAPUC-approved bidders, includingGeneration,for itsresidential andsmall andmediumcommercial classesthat
began inJune 2013.InSeptember 2013, PECO enteredinto contractswithPAPUC-approved bidders, includingGeneration,for its
residential andsmall andmediumcommercial classesthat began inDecember 2013.InJanuary2014, PECO enteredinto contracts
withPAPUC-approved bidders, includingGeneration,for itsresidential andsmall,mediumandlargecommercial classesthat will
begininJune 2014. Chargesincurredfor electric supplyprocuredthrough contractswithGeneration are includedin purchased
power fromaffiliateson PECO’s Statement ofOperationsandComprehensiveIncome.
Thesecond DSP Programalsoincludesanumber ofretailmarket enhancementsrecommendedbythePAPUC initspreviously
issuedRetailMarketsIntermediate WorkPlan Order. PECO wasalsodirectedto allowitslow-incomeCustomer AssistanceProgram
(CAP) customersto purchasetheirgeneration supplyfromcompetitive electric generation suppliersbeginningApril1,2014. On
May1,2013, PECO filedaPetition for Approval ofitsCAPShoppingPlan withthePAPUC, which thePAPUC grantedanddeniedin
part on January9,2014. PECO andother partiesto the proceedingfiledpetitionsfor reconsideration oftheCommission’s decision
on February10,2014, andthese petitionsare currentlypendingbefore thePAPUC.
See Note 3 oftheCombinedNotesto ConsolidatedFinancial Statementsfor additional information.
Smart Meter, Smart Grid and Energy Efficiency Programs
Smart Meter and Smart Grid Programs. In April 2010,thePAPUC approved PECO’s Smart Meter Procurement andInstallation Plan,
which wasfiledinaccordancewiththerequirementsofAct129. Also,in April 2010, PECO enteredinto a Financial Assistance
Agreement withtheDOE for SGIG funds under the ARRA of2009. Under theSGIG, PECO hasbeen awarded$200 million,the
maximumgrant allowable under the program, for its SGIG project—Smart Future Greater Philadelphia.TheSGIG funds are being
usedto offset the total impact to ratepayersofthesmart meter deployment requiredbyAct129. OnJanuary18, 2013, PECO filed
withthePAPUC itsuniversal deployment plan for approval ofitsproposal to deploytheremainder ofthe1.6 million smart meterson
an acceleratedbasis by theendof2014. OnMay31,2013, PECO andinterestedpartiesfiledaJoint Petition for Settlement ofthe
universal deployment plan withthePAPUC, which wasapprovedwithout modification on August15, 2013.In total, PECO currently
expectsto spendup to $595 million and$120 million on itssmart meter andsmart grid infrastructure,respectively, before
consideringthe$200 million SGIG.
See Note 3 oftheCombinedNotesto ConsolidatedFinancial Statementsfor additional information.
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