PA Default Service Program (DSP-VI)

Through this auction process, Metropolitan Edison Company (“Met-Ed”), Pennsylvania Electric Company (“Penelec”), Pennsylvania Power Company (“Penn Power”), and West Penn Power Company (“West Penn Power”) (each of which may be referred to as a “Company”, and/or in combinations as “Companies”) are seeking to procure full requirements Default Supply generation service for their Default Service Customers. The procurement delivery period for DSP-VI service is June 1, 2023 to May 31, 2027. 

As Default Service Suppliers, winning bidders must: (a) assume all responsibilities of a PJM Load Serving Entity ("LSE"), (b) provide for energy, (c) provide for capacity, (d) provide for ancillary services, (d) provide for transmission service, including Network Integration Transmission Service (“NITS”), and (e) provide certain Alternative Energy Credits (“AECs”) pursuant to the Alternative Energy Portfolio Standards Act (“AEPS”).

Default Service Suppliers for Met-Ed, Penelec, Penn Power, and West Penn Power must provide AECs needed to meet the non-solar requirements of the Companies’ Default Service Load as more specifically described in the SMAs.

In the first year of the DSP-VI term, Met-Ed, Penelec, and Penn Power will continue to allocate SPAECs obtained through existing long-term contracts that expire on May 31, 2024, to Default Service Suppliers and Energy Generation Suppliers (EGSs) on a load ratio basis. West Penn Power DS Suppliers continue to be responsible for the solar requirement.

For Met-Ed, Penelec, and Penn Power, the DSP-VI SPAEC allocations are the following:

ME 0.00035 SPAEC/MWH, PN 0.00050 SPAEC/MWH, PP 0.00045 SPAEC/MWH

For the second to fourth years of the DSP-VI term, the SPAECs that the Companies purchase through their solar PPAs will be allocated to Residential Default Service suppliers in proportion to the amount of residential load served over the course of the energy year. Met-Ed, Penelec, Penn Power, and West Penn Power will provide at least 32% of the SPAECs needed for the Residential Default Service Suppliers solar requirement. The allocated SPAECs may be greater than 32% based on the output from the solar project. Commercial and Industrial Default Service Suppliers and EGSs are responsible for their solar requirement.

Obligations of Default Service Suppliers for the Companies exclude the following: (a) Regional Transmission Expansion Plan charges (“RTEPs”), (b) PJM Expansion Cost Recovery charges (“ECRC”), (c) PJM charges associated with reliability must run (“RMR”) unit declarations and deactivation of plants for which charges are set after the approval of the DSPs by the Commission, (d) unaccounted for energy ("UFE"), and (e) historical out of market tie line, generation and retail customer meter adjustments. These charges will be collected by the Companies directly from shopping and non-shopping customers through competitively neutral non-bypassable charges as applicable. 

Default Service fixed priced products for residential and commercial customers will be procured in a separate auction ("Fixed Price (FP) Auction") from the hourly priced auction for industrial customers ("Hourly Priced (HP) Auction"). The fixed priced and hourly priced auctions will be conducted simultaneously.

As Independent Evaluator (also referred to as the Auction Manager), CRA International will manage each auction process. A simultaneous, multiple-round, descending-price clock auction format will be used. For additional information regarding the auction process and to receive updates please register on this Information Website.