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Frequently Asked Questions - Hourly Service Specific
Credit | Contract | Data | Qualifications | Customer and Rates | Rules | Other/General
Credit
| 1. |
Q. |
Is the credit requirement under the Hourly Service SMA based on a Mark-to-Market methodology? |
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A. |
No, the credit exposure under the Hourly Service SMA is a fixed amount of $750,000 per tranche. |
| 2. |
Q. |
Can I confirm that a guaranty is not required prior to the Bid Proposal Due Date? |
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A. |
This is correct. |
| 3. |
Q. |
If I have an existing guaranty with PPL Electric under the POLR RFP, but not the RFPs under the Default Service Procurement Plan, do I need to reissue a new guaranty if I win tranches in this Hourly Service RFP? |
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A. |
Yes, you will need to issue a new guaranty in the form of an Unconditional Guaranty as provided in the Hourly Service SMA as Exhibit E. Should you be a winning bidder in the Hourly Service RFP, you will be required to provide a new Unconditional Guaranty to replace the current Unconditional Guaranty held by PPL Electric pursuant to the POLR SMA under PPL Electric’s Competitive Bridge Plan ("CBP"). The terms and conditions of the Unconditional Guaranty under the POLR SMA are different from the terms and conditions of the Unconditional Guaranties under either the Hourly Service SMA or the SMAs for the Default Service Procurement Plan (“DSPP”). Each of the Unconditional Guaranties pursuant to SMAs under the Hourly Service SMA and under the PPL Electric’s DSPP is intended to be an all-inclusive Guaranty for all SMAs for default service and alternative energy credits, which include the POLR SMA under the CBP. The Guaranty pursuant to the POLR SMA under the CBP is not intended to be an all-inclusive Guaranty.
For additional information on this topic, please refer to DSPP FAQ 5 under Contract/General by clicking here. |
| 4. |
Q. |
When is the executed guaranty required by PPL Electric should I be a winning bidder in this Hourly Service RFP? |
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A. |
There is no specific date by which a Seller must submit an executed Unconditional Guaranty. However, a winning bidder who relied on the creditworthiness of a guarantor for the purpose of Bidder Qualifications will not be granted any Unsecured Credit until it submits an Unconditional Guaranty. Please further note that under the Hourly Service SMA a fixed security amount of $750,000 per tranche is due upon full execution of the transaction confirmations under the Hourly Service SMA. |
Contract
| 1. |
Q. |
How is the payment for capacity done? Is it done on a MW basis or some other basis? |
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A. |
Capacity payments are determined on the basis of the Monthly Settlement Capacity Obligation which is a MW value equal to the sum over the days in the month of the Sellers’s Capacity Obligation. The payment is calculated by multiplying the PJM Final Zonal Capacity price for the Delivery Point by the Monthly Settlement Capacity Obligation. |
| 2. |
Q. |
Is the capacity payment based on the PLC tags? |
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A. |
The PLC tags are used in calculating the seller’s capacity obligation on a daily basis. Capacity payments are determined on the basis of the Monthly Settlement Capacity Obligation which is a MW value equal to the sum over the days in the month of the Sellers’s Capacity Obligation. The payment is calculated by multiplying the PJM Final Zonal Capacity price for the Delivery Point by the Monthly Settlement Capacity Obligation. |
| 3. |
Q. |
For the hourly service SMA, please confirm that the cost of ancillary services is not passed through to the buyer in the same way that real-time LMP for energy and the daily capacity costs are passed through. |
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A. |
You are correct. As stated in section 1.1.9 of the RFP Rules, “…an Hourly Service Supplier will receive the hourly real-time spot market energy price for the PPL Zone, PJM’s pre-determined capacity charge for the PPL Zone, and the price it bid covering all other components of the Hourly Service supply necessary for PPL Electric to satisfy its obligations to its customers for that portion of the supply being served by the Hourly Service Supplier:” and ‘all other components of the Hourly Service supply’ would include ancillary services. |
| 4. |
Q. |
Please confirm my understanding that under the Hourly Service RFP, the price bid is only the fixed fee that PPL Electric will pay that bidder per MWh if that bidder is awarded load in the RFP, and the other portion of the monthly payment that PPL Electric will make to Hourly Service Suppliers is for capacity and energy, which would be the same to all suppliers on a per tranche basis. |
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A. |
You are correct. As stated in section 1.1.9 of the RFP Rules, “…an Hourly Service Supplier will receive the hourly real-time spot market energy price for the PPL Zone, PJM’s pre-determined capacity charge for the PPL Zone, and the price it bid covering all other components of the Hourly Service supply necessary for PPL Electric to satisfy its obligations to its customers for that portion of the supply being served by the Hourly Service Supplier;” and ‘all other components of the Hourly Service supply’ would include ancillary services. |
| 5. |
Q. |
Please confirm that the partially executed POLR Hourly SMA, for bidders that are not awarded any tranches, will be returned. |
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A. |
A non-winning bidder may request for a return of its partially executed POLR Hourly Service SMAs after the PUC has rendered its decision regarding the bid results, and PPL Electric will honor such requests. However, the Hourly Service SMA will not be returned to you absent such a request. |
| 6. |
Q. |
With reference to Exhibit D (Sample PJM Invoice) of the Hourly Service SMA, please clarify the charges and credits associated with the FTR Auctions that are assigned to Seller. |
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A. |
Instruments like FTRs are available for purchase through PJM without reference to load served and not tied to an LSE obligation or load served. As a Seller you may participate in the FTR Auctions administered by PJM and you will be responsible for any charges and credits associated with the FTRs that you acquire through the FTR Auction. |
| 7. |
Q. |
In Section 3.3 of the Hourly LCI SMA, it states that "On each Business Day beginning seven (7) days prior to the beginning of the Delivery Period and continuing throughout the Delivery Period, Buyer shall provide to the Seller on a reasonable efforts basis, Buyer’s estimation of the PLC for the seventh (7th) following day, representing the Seller’s Specified Percentage. Buyer does not warrant the accuracy of such information."
If a winning supplier of LC&I Hourly load has previously won tranches of either Residential or SC&I load for the same delivery term, please confirm that the supplier will receive separate PLC information for each customer type. |
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A. |
Yes, this information will be available for each of the Residential, Small C&I, and Large C&I Customer Groups separately. Please also refer to Contract FAQ-75 for more information about how you can access this information. |
Data
| 1. |
Q. |
Please confirm that the Rate Categories and Load Data file that is posted to the Web site has not incorporated information regarding the LC&I customers that have affirmatively enrolled to receive fixed-price service in 2010. For example, the “Capacity” tab provided an estimated ICO of 1,512 MW for LC&I Fixed Price Customers, and the tab “LCI_Fixed_Price_kWh” does not appear to have been updated. |
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A. |
This is correct. The Rate Categories and Load Data file that is currently posted is dated October 27, 2009, and has not been updated to reflect the final count of customers who have affirmatively enrolled by the deadline of November 9, 2009, to receive fixed price service in 2010. The Rate Categories and Load Data file will not be updated in time for the Bid Proposal Due Date of November 16, 2009. Please refer to the Hourly Service RFP Addendum for information regarding an estimate of the projected PLC for the Hourly Service Customer Group assuming all LC&I customers who have not affirmatively enrolled to receive fixed price POLR service will receive Hourly Service. |
| 2. |
Q. |
Where can I find data pertaining to the Large C&I customers that opted-in to the fixed price service? |
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A. |
Data surrounding the fixed price load, containing those Large Commercial & Industrial customers that have opted-in to the program, is available on the RFP Web site here. |
| 3. |
Q. |
Can you provide 2010 NSPL data for the aggregate Large C&I class? |
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A. |
2010 NSPL values are currently being calculated and will not be available until mid to late December. Suppliers who will be providing PPL Electric Utilities with supply beginning in 2010 will automatically get updated NSPL and Capacity numbers once they are calculated. For those suppliers that do not meet this criteria, all data will be made available at the next data upload in early January 2010, prior to the Bid Proposal Due Date (January 19, 2010) for the January 2010 solicitation under PPL Electric's Default Service Procurement Plan. |
| 4. |
Q. |
The RFP document for the Hourly Service RFP implies that only 65 MW peak have elected the fixed priced option. Have there been any updates or changes to this value? |
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A. |
The 65 MW value that you reference was derived from an estimate of the projected PLC for the Hourly Service Customer Group as referenced in the Hourly Service RFP Addendum dated November 10, 2009. The actual fixed-price PLC value based on those customers who have affirmatively opted-in to the fixed-price program is approximately 199 MW. |
| 5. |
Q. |
In reference to Data FAQ-4 what caused the difference between the estimated and actual PLC for opt-in customers? |
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A. |
The difference between the estimated PLC and the actual PLC for opt-in customers was due to web response that had not been processed and taken into account on November 9th as well as hard-copy (mail in) opt-in cards that were post-marked as of November 9th but were not received by PPL Electric until the next day. |
Qualifications
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There are no questions at this time. |
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Customer and Rates
| 1. |
Q. |
Other than the Generation Service Charge, are there other bypassable charges/riders that will add to a customers price-to-compare? Thank you for your help! |
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A. |
The Generation Service Charge and a reconciliation of the Transmission Service Charge based on the over/under collection are the only outstanding items in the issuance of a “final” price-to-compare. The reconciliation will occur in December of 2009. |
| 2. |
Q. |
I am trying to find out if Transmission charges will still be bypassable (pass thru) charges after 1/1/10 when the fixed energy charges take effect. |
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A. |
Transmission charges after 1/1/10 will be charged to customers through the transmission service charge (TSC), which does include Network Integration Transmission Service (NITS) as well as over/under collections; thus, all transmission charges are bypassable. |
Rules
| 1. |
Q. |
On slide 11 of the October 14 Bidder Information Presentation, the Hourly Service 2010 Projected PLC is listed as 1,890 MW. How was this determined? Is it all eligible customers in the Large C&I group? |
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A. |
The PLC on slide 11 of the October 14, Bidder Information Presentation is the PLC for the entire Large C&I group assuming that all customers would be placed on the hourly service product. Please be aware that the PLC for the hourly service product will be updated on November 10, 2009, once the deadline passes for the Large C&I customers to accept the fixed-price service product that was procured in October of 2009. |
| 2. |
Q. |
What is the maximum number of tranches a bidder can bid in this Hourly Service RFP? Specifically, slide 17 of the bidder information presentation dated October 14, 2009 specified a load cap of 16 tranches. |
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A. |
The maximum number of tranches a bidder can bid or win in this Hourly Service RFP is 17 tranches based on an 85 percent solicitation load cap. An announcement was sent to all RFP Bidders on November 10, 2009. This load cap is reflected in the bid proposal spreadsheet used for this Hourly Service RFP. |
Other/General
| 1. |
Q. |
Can you provide us with a sample notification that was sent to all PPL LCI customers to opt in to fixed price service by November 9, 2009? Could you also provide us with the date that the notifications were sent out to customers? Was there a confirmation of receipt of the opt-in notification? Were LCI customers able to opt into fixed price service via internet, telephone, and ground mail? |
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A. |
The timeline for Large C&I customer opt-in to the fixed price product is as follows: 1) In April of 2008 PPL EU began contacting LC&I customers to inform them of their options and how choice works; 2) from this point up until the July 27th first opt-in date PPL EU held various dialogues with customers (from webinars and phone calls to Choice Fairs); 3) during the week of June 1st, 2009 PPL EU sent letters to each LC&I customer informing them of their options and the July 27th deadline to preliminarily opt-in to the fixed rate option; 4) following the July 27th opt-in deadline, all customers that chose to opt-in were sent a confirmation letter; 5) representatives from PPL EU were available to respond to customers questions and comments until the final opt-in date of November 9, 2009; 6) all customers that have chosen to opt-in to the fixed rate by November 9, 2009 will be sent letters confirming their selection.
Customers were given two forums to opt-in to the fixed rate product: via a hard-copy card sent through the mail or via the internet. |
| 2. |
Q. |
Was the link to the website (listed below) which allowed customers to opt into fixed price service sent to all LCI customers? Was information regarding the website distributed via a mailing, e-mail, or through other means? http://www.pplelectric.com/Commercial+and+Industrial/rate+options/
power+purchase+optin+form+redirect.htm (Note: page no longer available) |
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A. |
During the week of June 1st, 2009 PPL EU sent letters to all LC&I customers informing them of their options and the July 27th deadline to preliminarily opt-in to the fixed rate option. Following the July 27th opt-in deadline, all customers that chose to opt-in were sent a confirmation letter that included all information necessary for the customers to enroll, including the link to opt-in to the fixed price service via the internet.” |
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