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Maryland SOS

MD – SOS Frequently Asked Questions

Overview:

Delmarva Power delivers electricity but does not generate it. Delmarva Power purchases the electricity it needs for its customers from unregulated wholesale suppliers, who own power plants and produce electricity or who buy and sell it on the wholesale market. Maryland law requires Delmarva Power to use a competitive bidding process to buy electricity for customers who do not choose an alternative electricity supplier. Customers are charged for this service – called Standard Offer Service (SOS) – under rates approved by the Maryland Public Service Commission (PSC). It is estimated that the average small commercial customer will see a total summer bill decrease of about 7 percent beginning with the June 2014 billing cycle. The new winter SOS rates beginning October 1, 2014 have not yet been set.

Competitive bidding occurs twice each year. Delmarva Power purchases the electricity it needs for its SOS customers from unregulated wholesale suppliers, who own power plants and produce electricity or who buy and sell it on the wholesale market. Contracts are awarded based on lowest price.

New SOS rates are effective for the Summer on June 1 and for Winter on October 1. Two times a year, Delmarva Power offers about 25 percent of the total residential SOS peak load for bids. The bids are for two-year contracts. The bidding combination of load, contract term and bidding frequency has been approved by the PSC. This approach has a dampening effect on price swings.

RGGI Rate Credit
Also, a monthly rate credit which changes quarterly is being applied to the bills of all Maryland residential customers.  The credit, entitled “RGGI Rate Credit,” appears as a line item on the bill.  It provides a billing credit to help offset surcharges for the cost of programs that will decrease energy demand and promote clean energy to fuel Maryland’s future prosperity.  RGGI stands for Regional Greenhouse Gas Initiative.

Funding for the RGGI credit comes from the Maryland Strategic Energy Investment Fund, which receives proceeds mainly from the sale of CO2 emission allowances by the State of Maryland.  The credit is a direct pass-through from the state to all residential electric customers and will be adjusted quarterly to reflect the latest sales of allowances.

Frequently Asked Questions:

What is Standard Offer Service?
Delmarva Power customers who do not choose an electric supplier will receive Standard Offer Service (SOS). This means Delmarva Power both delivers and purchases electricity for supply to its customers.

How does Delmarva Power purchase supplies for its SOS customers?
Delmarva Power follows a PSC approved competitive bid process – twice each year Delmarva Power offers about 25 percent of the total residential SOS peak load for bids. The bids are for two-year contracts. This approach has a dampening effect on price swings.

How often do customer SOS rates change?
New SOS rates are effective for the Summer on June 1 and for Winter on October 1.

How will the new SOS rates affect my summer, winter and annual bill?

For Maryland small commercial customers, the new summer SOS rate will decrease, by about $33.00, the average monthly summer bill beginning June 1, 2014. The new winter SOS rates beginning October 1, 2014 have not yet been set.

What power plant is my electricity coming from?

It’s hard to say. Two suppliers were publicly announced as winning a piece of the SOS load during this year’s competitive bid process, and a total of five suppliers serve all of the SOS load. The suppliers buy and trade the energy in the PJM marketplace so tracking its origin is difficult. The bid process simply ensures that we’ll get the needed reliable and competitive supply of electricity for delivery to our customers.

Who are the suppliers that were awarded contracts for June 1 of this year?
The following suppliers were publicly announced as winning supply contracts for this year;

  • Exelon Generating Co, LLC
  • NextEra Energy Power Marketing, LLC

Who will be supplying my electricity?
Starting June 1, 2013 your electricity will be supplied by the following suppliers;

Exelon Generating Co, LLC
DTE Energy Trading, Inc.
Hess Corporation
Macquarie Energy, LLC
NextEra Energy Power Marketing, LLC.

How much load did each supplier win and at what price?
Pricing information is confidential in compliance with PSC Formal Case No. 9056 and 9064 which govern the SOS bidding process. The percentage of load won by each supplier is listed below.

Exelon Generating Co, LLC 25.0%
DTE Energy Trading, Inc. 29.3%
Hess Corporation 20.7%
Macquarie Energy, LLC 8.3%
NextEra Energy Power Marketing, LLC 16.7%

How do I choose a supplier other than Delmarva Power?
First, you need to find out if there is an alternative retail electric supplier available to you. You can do this by calling the Maryland Public Service Commission, (800) 492-0474 or visit the Commission’s Web site, www.psc.state.md.us. If you are considering a competitive supplier, you should know your “SOS Pricing Information”, which is a listing of current and known Standard Offer Service (SOS) prices and a weighted average of known SOS prices, including effective dates based on your rate classification. The SOS Pricing Information includes Standard Offer and Transmission Services. It does not include other parts of your electric bill such as the cost to deliver electricity to your home (Distribution Services). All prices are in cents per kilowatt-hour and are provided as information to help you evaluate Pepco’s SOS rates with offers from competing electricity suppliers.

Delmarva Power provides each customer with SOS Pricing Information on the monthly electric bill. Such information will change from time to time as new rates are set for the summer and winter.

Will my bill be the same or will new information be added?
Your bill will essentially look the same. The new rates for Standard Offer Service will be reflected in the Supply Charges portion of your bill. See our tutorial and brochure on the bill format for Maryland customers.

When will the Delmarva Power rates be available?
The new rates are already available on our Web site at delmarva.com in the Tariff section.

What kilowatt hour consumption amount did you use to calculate the decrease for the average customer?
The kilowatt hour consumption used to calculate the annual residential bill for the average customer is about 1,000 kilowatt hours per month.

Will I still have a different rate in the summer than in the winter?
Yes. The SOS rates that will take effect on June 1, 2014, will be your summer rate. Winter rates will take effect on October 1, 2014.

What is the RGGI Rate Credit?
The RGGI Rate Credit is a monthly rate credit that is applied to the bills of all Maryland residential customers. The credit appears as a line item on the bill. It provides a billing credit to help offset surcharges for the cost of programs that will decrease energy demand and promote clean energy to fuel Maryland’s future prosperity. RGGI stands for Regional Greenhouse Gas Initiative.

Funding for the RGGI credit comes from the Maryland Strategic Energy Investment Fund, which receives proceeds mainly from the sale of CO2 emission allowances by the State of Maryland. The credit is a direct pass-through from the state to all residential electric customers and will be adjusted quarterly to reflect the latest sales of allowances.