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How did electric generation begin in Illinois?
The Choice and Rate Relief Law of 1997 provided for a transition to competition in generation and initiated retail competition. The Illinois utilities divested their generation and entered into power purchase agreements (PPA) with the new generation owners through December 2006. During this transition period, customer rates were reduced and frozen. After 2006, the Illinois utilities will purchase power through the Illinois Auction which is scheduled for September 2006 to determine prices Illinois electric consumers will pay from January 2, 2007 through May 2008. In addition, the ComEd territory became part of PJM in May, 2004.
What is changing in the ComEd market in 2007?
The transition period ends in December 2006 and current tariffs (e.g. Rates 6, 6L, and HEP) will terminate. In addition, the Transmission & Distribution rate freeze expires. The RCDS (Retail Customer Delivery service) is replaced by Rate RDS (Retail Delivery Service) and New Basic Service tariffs become effective. The Utility Competitive Procurement Process (CPP) for energy changes from PPA to reverse auction.
What is the Illinois Auction?
The Illinois Auction is a Competitive Procurement Process (CPP) by which Commonwealth Edison will procure power for their retail customers for supply beginning January 2007. The Illinois Auction is tentatively scheduled to begin on September 5, 2006.
What is the format of the Auction?
The auction format is a simultaneous descending clock auction where the bidding proceeds in rounds. The suppliers state how many tranches they want to supply at prices suggested by the auction manager. Prices tick down starting high and being reduced gradually until there is no more excess supply left. The auction clearing prices for each utility by will then be translated into retail rates for customers on fixed price service.
What is the timeline for the ComEd auction?
Event
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Timeline |
Tentative Dates* |
| Start of Illinois Auction (Commencement Date) |
Tentative Date
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9/5/06
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Auction Completion Date
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May be same day or few days after auction commences
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9/5/06
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Auction Manager’s Report to the ICC
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Within 2 business days following Auction Completion Date
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9/7/06
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Declaration of Successful Result
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Issued at the end of the 5th business day following the Auction Completion Date (assuming no investigation needed)
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9/12/06
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ComEd Files Retail Supply Charge with ICC
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Within 9 business days of Declaration of Successful Result
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9/25/06
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BES- NRA Enrollment Window for 400 kW to 3 MW Customers
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50 calendar days after ComEd makes its Retail Supplier Charge filing
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9/26/06 – 11/14/06
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BES- NRA Enrollment Window for > 3 MW Customers
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30 calendar days after ComEd makes its Retail Supplier Charge filing |
9/26/06 – 10/25/06
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New ComEd Tariffs Take Effect
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1/2/07
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* Tentative estimated dates
What are the customer auction supply groups for the ComEd auction?
Customers are divided into three load categories: A, B and H (representing Annual, Blended and Hourly respectively). The Competitive Procurement Process (CPP) load categories are often referred to as CPP-A, CPP-B and CPP-H.
In the ComEd market, what are the applicable bundled rate tariffs, the enrollment windows and switching restrictions?
The tables have been provided for convenience. Please refer to the CPP tariff for additional details and updates.
What price can I expect to pay for power in 2007?
ComEd rates were slashed by 20% and frozen for 10 years as part of a transition period to full deregulation. Therefore, prices for 2007 are likely to be higher. The number of shoppers is expected to increase dramatically in the fourth quarter of 2006 as Illinois customers react to the end of the transition period and the fixed default rates (established 10 years ago) expire.
Power prices can be highly volatile. As you can see in the graph, the forward prices for peak power in 2007 for PJM West have ranged from a low of $73/MWh to a high of $92/MWh. The price you pay depends on the timing of your contract decision, your usage profile and the product you choose. GDF SUEZ Energy Resources can help you manage your energy needs. With our complementary Price Watch service, we will contact you as soon as market prices reach your pre-specified trigger price and can provide customer specific pricing reports based on your desired frequency. Contact one of our sales reps to see how you can get enrolled for free with the Price Watch service.
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