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Effect of LMP on Massachusetts Electric’s Retail Rates

Effect of LMP on Massachusetts Electric’s Retail Rates. Carlos A. Gavilondo VP, Distribution Regulatory Services Massachusetts Electric Company February 28, 2003. Mass. Electric Serves …. Approximately 1.2 million customers Peak load of approximately 4,500 MW Customers in each Load Zone

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Effect of LMP on Massachusetts Electric’s Retail Rates

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  1. Effect of LMP on Massachusetts Electric’s Retail Rates Carlos A. Gavilondo VP, Distribution Regulatory Services Massachusetts Electric Company February 28, 2003

  2. Mass. Electric Serves … • Approximately 1.2 million customers • Peak load of approximately 4,500 MW • Customers in each Load Zone • NEMA/Boston – 23% • WCMA – 47% • SEMA – 30% 2

  3. Massachusetts Load Zones 3

  4. LMP Effect on Retail Rates • Depends on Supply Type, Load Zone and Customer Rate Class • Standard Offer Customers • SOS customers will see no zonal price differentials, regardless of zone or size • “Settlement rates” • ~836,000 customers, ~61% of total kWh deliveries • Some Default Service and Competitive Supply Customers will see zonal effects 4

  5. Default Service; Competitive Supply • Default Service Customers • No zonal difference prior to May 1, 2003 • Beginning May 1: • Large and Medium-sized customers will see zonal prices • ~3,900 customers, ~7% of total kWh deliveries • Small commercial and residential customers will not see zonal prices; i.e., zonal default service bids will be averaged across the 3 zones • ~346,000 customers, ~13% of total kWh deliveries • Competitive Supply Customers • Depends on contract • ~20,000 customers, ~19% of kWh deliveries 5

  6. Steps on the Road to LMP Implementation • Assign each customer to a Load Zone • Based on customer’s electric supply source • Maintained in CIS • Included in supplier EBTs • Reflected on customer lists available to suppliers • Indicated on customer bills as of March 3 6

  7. Portion of Sample Bill 7

  8. More Steps on the Road to LMP Implementation • Procure Default Service Zonally • Zonal procurements by customer class (although average pricing for small customers) • RFPs issued last week • Finalize protocol for monitoring and reflecting zonal changes; communications; etc. 8

  9. Final Thought . . . “You’ve got to be very careful if you don’t know where you’re going, because you might not get there.” Yogi Bera 9

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