In Response to “After six-year dispute, court orders $37 million ComEd refund”
Written by Michael Vrtis President of Realgy Energy Services in response to the Crain’s article After six-year dispute, court orders $37 million ComEd refund
So how do all the various entities work in overseeing a regulated utility or why does it take 6 years to refund overcharges?
This Crain’s article provides a great example, let’s look at the 3 steps:
STEP 1
The utility; ComEd has a monopoly to delivery electricity in its area and is overseen (regulated) by the Illinois Commerce Commission (ICC). ComEd wants to be paid more for providing service and goes to the ICC requesting an increase in fees from customers in exchange for providing better and more useful service.
The regulator; ICC approves a rate increase (and the improved service) for which ComEd begins charging customer
STEP 2
The Consumer Advocate; Citizens Utility Board (CUB) is an agency that seeks to ensure ComEd treats its customers (mainly residential) fairly. Remember ComEd is a monopoly and can only charge what the ICC (in some cases politicians) approve. The CUB sees that the ICC approval of the rate increase unfairly treated the consumer to the benefit of ComEd. So, CUB sues ComEd and wins.
The Court; orders the ICC to review the matter. Again, the court won’t get into the technical review (that’s why they sent it to the ICC for re-review).
STEP 3
This step is about appealing (delaying) the previous decisions….. in this case the ICC agrees with CUB and removes those funds from the rate base which means ComEd (having already collected them) has to return them. They don’t have to return them as they were received but by some form of distribution of the funds.
Of course, ComEd appeals to the appellate court (they review lower court decisions) and lost. The appellate court would have to overturn the ICC on technical issues to agree with ComEd.
So let’s see if the money is returned. This example illustrates that a regulated utility has many people who watch them and those who watch and act to hold all sides accountable really do serve the public interest.
How does this affect Realgy’s customers; they will receive a refund (depending on how ComEd disperses them) as this was a charge related to distribution of the wholesale supplied energy in part provided by Realgy.
Check out the Crain’s article: “After six-year dispute, court orders $37 million ComEd refund”
In response to “How ComEd’s rate design benefits suburbs over the city”
Written by Michael Vrtis, President of Realgy Energy Services in response to Crain’s article “How ComEd’s rate design benefits suburbs over the city”
ComEd is one member of a larger group of utilities called PJM. Each utility that makes up the power pool of PJM sets how its own method of collecting the costs of running the power plants and transmission lines. This makes the PJM pool a low-cost producer with great reliability.
PJM has notified its members (who voted for it years ago) about his change.
ComEd can allocate capacity costs in any manner it wishes; however, ComEd chooses not to change its collection approach which has stayed the same for more than 20 years.
ComEd doesn’t need smart meters to make this change, it needs smarter policy.
Allocating capacity based on aggregate demand of the load center serving a municipality is possible as well as more equitable than the broad and out-dated policy of ComEd.
Realgy already operates under PJM capacity allocation rules and we will continue to be the residential and business choice where energy is all about price, information, and service.
Check out Crain’s article: “How ComEd’s rate design benefits suburbs over the city”