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Default Service Supply

Default Service Supply ("DSS") provides commercial and industrial customers with a default service supply rate that is determined based on a request for proposal to acquire the energy to serve the load of customers taking service under the provisions of this Rider 8. Commercial and industrial customers are defined in Rate Schedules GS/GM and GMH, and, in general, are those customers with a monthly metered demand that is less than 300 kW in a twelve (12) month period.

The Company will provide default service supply under Rider No. 8 - Default Service Supply by obtaining the requirements from suppliers through competitive procurements using a Request for Proposal ("RFP") process. DSS obtained through the RFP process includes energy, capacity, transmission and distribution line losses, congestion and congestion management costs, Alternative Energy Credits ("AECs") and other such services or products that are required to provide default service to the Company's commercial and industrial customers including Auction Revenue Rights and Financial Transmission Rights ("ARRs/FTRs"). DSS shall not include transmission service within Duquesne's zone or ancillary services. Duquesne will be responsible for and continue to provide network integration transmission service, ancillary services, and grid management charges on behalf of all default service load. The applicable charges for these services are defined in Appendix A of Duquesne Light's Retail Tariff.

PROCUREMENT PROCESS

The Company will conduct separate RFP solicitations for DSS under Rider No. 8 - Default Service Supply approximately every six (6) months. The RFP process will be bid out separately for customers with monthly metered demand less than 25 kW and for customers with monthly metered demand equal to or greater than 25 kW to ensure that there is no cross subsidization. The Company will update the rates for the DSS according to the schedule in Rider No. 8. The Company will issue RFPs prior to the beginning of each Application Period to update the default service supply rates. The updated rates will be based on the new price(s) available from the winning suppliers through the RFP process. The rates will include a reconciliation adjustment for the prior period as described in the "Calculation of Rate" section of Rider No. 8. In the month prior to the beginning of each Application Period, the Company will file new DSS charges with the Pennsylvania Public Utility Commission ("Commission") for the subsequent Application Period, and, upon Commission approval, these charges shall become effective on the first day of the following month. The commercial and industrial load for the RFP will be divided into Tranches. Winning suppliers will provide DSS for the percentage of DSS load corresponding to the number of Tranches won in the RFP. Duquesne seeks to procure all Tranches in the RFP process pursuant to the RFP schedule approved by the Commission. The selection of bids will be submitted to the Commission for its approval or rejection within one business day after submittal. If the bids are not acted on by the Commission within one business day, the Company may proceed on the basis that they are approved and award the bids pursuant to 52 Pa. Code § 54.188(d).

CONTINGENCY PLAN

In the event Duquesne receives bids for less than all Tranches or the Commission does not approve all or some of the submitted bids or in the event of supplier default, then Duquesne will provide the balance of the default supply for commercial and industrial customers through purchases in the PJM spot markets until such time that a different contingency plan is approved by the Commission. Duquesne will submit to the Commission within 10 days after any such occurrence an emergency plan to handle any default service shortfall. All costs associated with implementing the contingency plan will be included as part of the DSS described in the section below, "Calculation of Rate."

CALCULATION OF RATE

DSS rates shall be determined based on the formula described in this section. The rates shall include an adjustment to reconcile revenue and expense for the previous application period. The DSS shall be determined to the nearest one-thousandth of one (1) mill per kilowatt-hour in accordance with the formula set forth below and shall be applied to all kilowatt-hours billed for default service provided during the billing month:

DSS = (((DSSa - E)/(1-T)))/S

Where:

DSS = Default Service Supply rate, converted to cents per kilowatt-hour, to be applied to each kilowatt-hour supplied to customers taking default service from the Company under Rider No. 8 - Default Service Supply.

DSSa = The total estimated direct and indirect costs incurred by the Company to acquire DSS from any source on behalf of customers described above in the "Procurement Process." The Application Period shall be for each period over which the DSS, as computed, will apply. Projections of the Company's costs to acquire default supply for the Application Period shall include all direct and indirect costs of generation supply to be acquired by the Company from any source plus any associated default service supply-related procurement and administration costs.

E = Experienced net over or undercollection of costs associated with the acquisition of supply for applicable customers ending one month prior to the end of the preceding Application Period, including applicable interest. Estimated costs will be included for the final month due to timing of the filings, with full reconciliations in the subsequent filing. Interest shall be computed monthly at the rate provided for in Section 52 Pa. Code §54.187(f), from the month the over or undercollection occurs to the month in which the overcollection is refunded or the undercollection is recouped.

S = The Company's default service retail kWh sales to customers in the applicable Customer Class, projected for the Application Period.

T = The Pennsylvania gross receipts tax rate in effect during the billing month, expressed in decimal form.

The DSS shall be filed with the Commission on or about the fifteenth day of the month prior to the start of the next Application Period. The rate shall become effective for default supply service rendered on and after the beginning of the Application Period unless otherwise ordered by the Commission, and shall remain in effect for the effective periods defined above, unless revised on an interim basis subject to the approval of the Commission. Pursuant to 52 Pa. Code §69.1809(c), upon determination that the DSS, if left unchanged, would result in a material over or undercollection of supply-related costs incurred or expected to be incurred during the effective period, the Company may file with the Commission for an interim revision of the DSS to become effective thirty (30) days from the date of filing, unless otherwise ordered by the Commission.

The Company will file with the Commission by the fifteenth day of the month prior to the next Application Period a reconciliation of the DSS revenue recovery during the immediately preceding Application Period pursuant to 66 Pa. C.S. §1307. The reconciliation shall become effective for service rendered on and after the beginning of the next calendar month and shall remain in effect until new DSS rates are approved by the Commission.

Minimum bills shall not be reduced by reason of the DSS. DSS charges shall not be a part of the monthly rate schedule minimum nor be subject to any credits or discounts. Application of the DSS shall be subject to continuous review and audit by the Commission at intervals it shall determine.

Hourly Price Service

We provide large commercial and industrial customers with the ability to purchase their electric supply requirements on a day-ahead hourly basis. Beginning January 1, 2008, the Company will supply electricity under this rider by obtaining the requirements through the PJM market and passing through all such costs to the customer to provide this service. This rider is also available for the supply of electricity to generating stations that are not otherwise self-supplying and where the generating station is not otherwise receiving service from an EGS. Metering equipment must be installed at the generating station at the expense of the customer.

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MONTHLY CHARGES

 Energy charges are hourly and provided at the day-ahead and real-time PJM locational marginal prices based on the customer's day-ahead scheduled load and the customer's real time metered hourly load, plus energy-related ancillary services including PJM administrative charges, adjusted for losses, plus a retail margin. PJM posts the day-ahead locational marginal price on their web site at 4:00 PM EPT. Balancing operating reserve charges will be assigned to each customer based on their pro-rata share of the net system deviation from the day-ahead forecast. Capacity charges are equal to the full PJM Reliability Pricing Model ("RPM") capacity price for the Duquesne Zone, and shall recover the charges associated with the customer's share of the Company's capacity obligation assigned by PJM, plus the charges for capacity based ancillary services. Energy and capacity charges will be calculated using the following formula and adjusted for the Pennsylvania Gross Receipts Tax (GRT) in effect.Where:

t = Particular clock hour in the Billing Period from start hour to end hour for energy charges.

D = Particular day in the Billing Period from start day to end day for capacity changes.

Customer Load
LDA = Day-Ahead scheduled hourly load of the customer, measured in MW.

LRTt = Actual (Real-Time) metered load of the customer, measured in MW.

ADJt = Adjustments to the customer load at the retail meter using the same methodology used to determine the hourly load obligations of a customer served by an EGS pursuant to Duquesne's Supplier Coordination Tariff. The hourly load adjustments shall be the sum of the percentage distribution and transmission (if applicable) losses of the applicable schedule as specified in Duquesne's Supplier Coordination Tariff. The Company will also adjust the customer load for the loss de-ration factor defined by PJM.

Energy Charges
LMPDA = Day-Ahead hourly locational marginal price (LMP) is $/MWH including energy, congestion and marginal losses for the Duquesne Zone or Duquesne Residual Zone as applicable.

LMPRTt = Real-time hourly locational marginal price (LMP) in $/MWH including energy, congestion and marginal losses for the Duquesne Zone or Duquesne Residual Zone as applicable.

PJM Ancillary Service Charges and Other PJM Charges
SRRTt = Hourly real-time synchronous reserve charge in $/MWH as calculated by PJM for supporting the customer's load.

ORDAt = Hourly Day-Ahead operating reserve (supplemental) charge in $/MWH as calculated by PJM for supporting the customer's load.

ORRTt = Hourly real-time operating reserve (supplemental) charge in $/MWH as calculated by PJM for supporting the customer's load.

REGRTt = Hourly real-time regulation charge in $/MWH as calculated by PJM for supporting the customer's load.

SCNRTt = Real-time Synchronous Condensing Charge in $/MWH for supporting the customer's load if this charge is billed separately by PJM to the Company.

S1A = PJM Schedule 1A rate in $/MWH applicable to the Duquesne Zone.

PJMs = PJM Surcharge is a pass-through of the charges incurred by the Company for grid management and administrative costs associated with membership and operation in PJM. These are the charges incurred by the Company under PJM Schedules 9 and 10 to provide hourly price service.

RD = Reactive supply service charge in $/MW-day to serve the customer's load as calculated under the PJM Tariff Schedule 2.

BD = Blackstart service charge in $/MW-day to serve the customer's load as calculated under the PJM Tariff Schedule 6A.

Retail Margin
FRA = The Company's fixed retail adder of $4.49 per MWH.

Renewable Energy
REN = Pass-through of the costs in $/MWH for the Company to comply with the Pennsylvania Alternative Energy Portfolio Standards (AEPS) Act of 2004 (Act 213).

Customer's Capacity Obligation and Network Service Peak Load
COD = Capacity Obligation in MW for each day associated with supporting the customer's load as described in the section "Determination of Capacity Obligation".

NPLCD = The customer's daily network service coincident peak load contribution in MW. This quantity is determined based on the customer's load coincident with the annual peak of the Duquesne Zone (single coincident peak) as defined in the PJM Tariff Section 34.1.

Capacity Charges
CChgD = The demand charge in $/MW-day, which is equal to the full PJM RPM Final Zonal Capacity Price for the Duquesne Zone.

PJM bills these charges to the Company as a function of the load measured in megawatts (MW) and expresses these charges as $/MW, $/MWH and $/MW-day. The Company measures the customer's load and energy usage in kilowatts (kW) and will convert the above charges to $/kW, $/kWh and $/kW-day for the purposes of computing the customer's monthly bill.

LOCATIONAL MARGINAL PRICE
The "Duquesne Zone" is the PJM-defined area encompassing the franchised service territory of the Duquesne Light Company. The pricing for the Duquesne Zone contains every transmission load bus on the Company's system. PJM will determine the locational marginal price for the Duquesne Zone and an hourly nodal locational marginal price for each load bus. Load Serving Entities (LSE's) and wholesale transmission customers have the option of electing energy settlement at the hourly nodal prices. The "Duquesne Residual Zone" is the pricing zone determined by PJM in the event that LSE's or other wholesale transmission customers in the Duquesne Zone elect settlement based on nodal locational marginal energy prices. In such event the Duquesne Zone locational marginal price will be replaced by the Duquesne Residual Zone locational marginal price and:

(i) the pricing for such zone will be calculated by PJM using a load-weighted average of the nodal locational marginal prices of all load buses within the Duquesne Zone, but excluding from such calculation the weighting at the respective nodal prices of the load served by LSE's or other wholesale transmission customers who have elected nodal settlement; and

(ii) settlement for all LSE's and wholesale transmission customers in the Duquesne Zone that have not elected nodal settlement, will have their load obligations settled on an hourly day-ahead, hourly realtime or other periodic basis at the respective PJM-determined price for the Duquesne Residual Zone for such period.

DETERMINATION OF CAPACITY OBLIGATION

The capacity obligation subject to the Demand Charges in this rider will be the customer's share of the Company's capacity obligation determined by PJM. The Company's capacity obligation will be calculated by PJM based on the Company's peak system load and will be the basis for the capacity obligation for the following planning year.

In determining the customer's share of the capacity obligation, the Company will calculate the customer's peak load contribution. The peak load contribution is based on the customer's load coincident with the peak hour of the five peak days as determined by PJM. The customer load in each of these five hours, adjusted for the Company's transmission and distribution line losses and the customer's share of unaccounted for energy will be averaged to calculate the customer's peak load contribution. Customers may participate as a Demand Resource or as an Interruptible Load Resource ("ILR") under RPM in PJM. Any and all charges or credits associated with the customer's participation as an ILR will be applied to the customer's bill.

NOTIFICATION AND ELECTION OF SERVICE

Customers may elect to purchase their supply requirements through this rider at any time according to the requirements of Rule No. 45. Customers that do not elect service with an EGS will default to hourly price service under this rider.

DAY-AHEAD SCHEDULING GUIDELINES

The Company will provide an hourly load forecast (with losses) on the DLC customer choice web site for each customer taking service under this rider by 8:00 AM EPT each PJM business day. The customer may update the Company forecast prior to 10:00 AM EPT. The forecast at 10:00 AM EPT will be considered the final forecast values in the day-ahead demand bid and will be binding upon the customer. The Company will aggregate all of the final customer forecasts, de-rate per the mean PJM EDC loss de-ration factor, and submit this aggregated day ahead demand bid prior to 12 PM EPT PJM business day-ahead. The Company will review the forecasted loads provided by the customer to ensure they are reasonable so as to not affect charges that may be allocated to other participating customers. All load submitted as part of the day-ahead demand bid for each customer will be billed to the customer at the day-ahead LMP. PJM will calculate the balancing charges based on the difference between the day-ahead demand bid and actual load. The customer will receive a charge or credit at the real-time LMP if the actual load is greater than or less than the demand bid, respectively. PJM balancing operating reserve charges will be assigned to each customer on this rider based on their pro rata share of the net system deviation from their portion of the day-ahead demand bid.

The Company will apply the procedures for load forecasting, day-after load estimates and supply schedules, and reconciliation as defined in the Company's Electric Generation Supplier Coordination, Rules 6, 7 and 8, respectively.

GENERAL

The Supply Charges are intended to recover the market costs of providing Default Service to customers in PJM as these costs may change or be redefined from time to time. The Supply Charges shall be calculated using the formula and prices referenced above, but may be revised from time to time, as necessary, to reflect changes in PJM rules and charges. The Company is required to include renewable energy sources as a component of providing POLR service. The Company will pass-through the charges required to comply with the Alternative Energy Portfolio Standards (AEPS) as those compliance requirements change. The formula is illustrative to reflect the charges in the PJM tariff and is subject to change at any time, as PJM rules, charges or market parameters change.

Price to Compare

Duquesne Light Company
Class Average Price to Compare by Rate Class
in Cents Per Kilowatt Hour
Rate Name Description PTC
EFFECTIVE
10/01/2018
PTC
ESTIMATED
12/01/2018
GS General Service Small Available for the standard electric service taken on a small general service, non-demand metered, customer's premises for which a residential rate is not available. 6.53 6.49
GM <25 kW General Service Medium Available for the standard electric service taken on a medium general service, demand metered - less than 25 kilowatts, customer's premises for which a residential rate is not available. 6.82 6.78
GM >25 kW General Service Medium Available for the standard electric service taken on a medium general service, demand metered - greater than or equal to 25 kilowatts, customer's premises for which a residential rate is not available. 6.52 7.61
GMH <25 kW General Service Medium Heating Available for all standard electric service taken on a medium general service, demand metered - less than 25 kilowatts, customer's premises for which a residential rate is not available, where the Company's service is the sole method of space heating, and where such calculated heat loss converted into kilowatt-hour consumption during the heating season is determined by the Company to be at least 25% of the customer's entire electric energy requirements during the heating season. 6.56 6.52
GMH >25 kW General Service Medium Heating Available for all standard electric service taken on a medium general service, demand metered - greater than or equal to 25 kilowatts, customer's premises for which a residential rate is not available, where the Company's service is the sole method of space heating, and where such calculated heat loss converted into kilowatt-hour consumption during the heating season is determined by the Company to be at least 25% of the customer's entire electric energy requirements during the heating season. 6.28 7.37
UMS Unmetered Service Available to customers using unmetered standard service at each point of connection for customer-owned and maintained equipment such as traffic signals, communication devices and billboard lighting. 6.20 6.16
AL Architectural Lighting Service Available for separately metered circuitry connected solely to outdoor architectural lighting equipment, with demand of 5 kilowatts or greater, to be operated during non-peak periods. 4.48 4.43
LED Street Lighting Municipal LED Available for light-emitting diode (LED) lighting of public streets, highways, bridges, parks and similar public spaces, for normal dusk to dawn operation of approximately 4,200 hours per year. 3.37 3.32
SE Street Lighting Energy Available for the entire electric energy requirements of municipal street lighting systems where the municipality has not less than 15,000 street lamp installations and provides for the ownership, operation, and maintenance of its own street lamp installations and takes its entire energy requirements for street lighting under this rate. 3.41 3.36
SM Street Lighting Municipal Available for mercury vapor and high pressure sodium lighting of public streets, highways, bridges, parks and similar public spaces, for normal dusk to dawn operation of approximately 4,200 hours per year. 3.37 3.32
SH Street Lighting Highway Available for high intensity discharge lighting of state highways for normal dusk to dawn operation of approximately 4,200 hours per year where the highway lighting system acceptable to Duquesne Light Company is installed by the State and ownership of the entire highway lighting system has been transferred to the Company for a nominal consideration. 3.35 3.30
PAL Private Area Lighting Available for high pressure sodium lighting and flood lighting of residential, commercial and industrial private property installations including parking lots, for normal dusk to dawn operation of approximately 4,200 hours per year. 3.40 3.35

 

For more information about the Pennsylvania Electric Choice Program, call Duquesne Light at 412-393-7100 or visit www.papowerswitch.com.

To learn more about selecting DLC as your supplier, please click here.

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