Setting a retail generation credit

Electricity Journal

Volumn 12, Issue 4, 1999, Pages 80-87

  Jacobs, Jonathan M ^a  

^a NONE

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COSTS;

EID: 0033130622     PISSN: 10406190     EISSN: None     Source Type: Journal    
DOI: 10.1016/S1040-6190(99)00030-5     Document Type: Article

References (7)

1. 1. Assuming it is based on the forecast for the price of a standard wholesale product, which involves constant delivery.
2. 2. Excluding Oct. 15, when the PX had a technical problem.
3. 3. This computation is based on futures prices for 1999 observed on Nov. 20, 1998, and assuming a 5 percent risk-free rate, and 75 percent volatility.
4. 4. PECO is mentioned specifically only for ease of exposition, not to suggest they are any better or worse in this regard than other Pennsylvania PJM utilities.
5. 5. Although PECO claims it is FERC-jurisdictional.
6. 6. Specifically, Ohio Power and Columbus Southern. The 4-mill cost noted here is referenced in the Public Utility Commission of Ohio's report to the General Assembly on the 1998 price spike. It is in the Ohio Power and Columbus Southern tariffs as a clause enabling them to charge customers all "applicable costs" of buy-through service. PUCO staff in a telephone conversation confirmed the specific value (4 mills) and the justification (administrative costs).
7. 7. This depends on the way energy credits are computed.