Council of the District of Columbia. Committee on Business Consumer and Regulatory Affairs. Councilmember Vincent B. Orange, Chair

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1 Council of the District of Columbia Committee on Business Consumer and Regulatory Affairs Councilmember Vincent B. Orange, Chair FY14-15 Performance Oversight Hearing Responses Office of the People s Counsel ( OPC ) February 24, 2015 AGENCY ORGANIZATION AND PERSONNEL 1. Provide a complete, up-to-date organizational chart for each division within OPC including, either attached or separately, an explanation of the roles and responsibilities for each division and subdivision. Also, provide a narrative explanation of any organizational changes made during FY14 and thus far in FY15. The Office has four (4) Divisions, with the below listed roles and responsibilities: Directorate Division determines overall policy, consistent with the Agency s mission to advocate for and protect the interests of D.C. utility consumers. Operations Division coordinates fiscal management, communications, editorial functions, assessments, space acquisitions, procurement, human resources, staff development, benefits administration, and management information systems including all aspects of the Agency s computer network and information management. Litigation Services Division litigates before the Public Service Commission, federal regulatory agencies and the D.C. Court of Appeals. This Division consists of the Energy, Telecommunications, Technical, and Market Monitoring Sections. Consumer Services Division provides education and outreach to District consumers as well as assistance and representation to individual consumers in dispute with utility companies. Provides technical resources and support to the Consumer Utility Board and other community and civic associations. Energy Efficiency and Sustainability Section identifies strategies and activities to support and facilitate the transition of the District to a clean-energy economy and provides D.C. consumers with long-term environmental and economic benefits. Page 1 of 69

2 Organizational Changes: In November of FY 2015 OPC brought onboard a Chief Operating Officer ( COO ). The COO is responsible for managing, developing, planning, organizing and supervising the implementation of the duties and assignments of the human resources, IT, finance and budget, contract and procurement, and administrative policies and procedures including the day to day Agency wide operational matters. The addition of the COO provided the People s Counsel and the Deputy People s Counsel the opportunity to relinquish multiple operational based duties and focus more effectively on advocating on behalf of consumers of natural gas, electric and telephone services in the District In January of FY 2015 OPC filled it s Administrative Specialist vacancy with an internal hire who met the requirements and qualifications for the position. In January of FY 2015 OPC strengthened its Litigation Services Division by filling an Assistant Peoples Counsel position through an internal hire who met the requirements and qualifications of the positon. In February of FY 2015 OPC filled a vacant Executive Assistant positon with an outside hire who met the requirements and qualifications for the position. See Attachment 1: OPC Organizational Chart Page 2 of 69

3 2. Provide a complete, up-to-date position listing for the agency, which includes the following information: A. Title of Position B. Subdivision of the agency in which the position is located C. Name of employee or statement that the position is vacant, unfunded, or proposed D. Date employee began in position E. Salary and fringe benefits, including the specific grade, series, and step of position F. Job status (continuing/term/temporary/contract) See Attachment 2, Position Listing Page 3 of 69

4 3. Provide a complete, up-to-date position listing of all employees detailed to OPC from other District agencies, which includes the following information: A. Title of Position B. Subdivision of the agency in which position is located C. Name of employee or statement that the position is vacant, unfunded, or proposed D. Date employee began in position E. Salary and fringe benefits, including the specific grade, series, and step of position F. Job status (continuing/term/temporary/contract) OPC has no detailed employees. Page 4 of 69

5 4. Provide the number of FY14 full-time equivalents ("FTEs") for the agency, and FY15 FTEs to date, broken down by program and activity. Please also note the number of vacancies at the close of FY14 and in FY15, to date, by program and activity. A. For each vacant position, please note how long the position has been vacant and whether or not the position has been filled. B. How many vacancies within the agency were posted during FY14 and how many have been posted during FY15, to date? The agency posted five vacancies for FY14 and two vacancies for FY15. Page 5 of 69

6 5. Please provide: A. A list of all employees who receive cell phones, personal digital assistants, or similar communications devices at the agency s expense. OPC Employee Communication Devices: Employee Cell Number Eric Scott Frank Scott Agency Van (hardwired) Spare Employee PDA Number Sandra Mattavous-Frye Naunihal Singh Gumer B. A list of all employees who receive laptops and tablets at the agency s expense. No OPC employee has received a laptop at the agency s expense. Laptops are available for employees to sign out for use off premises as needed, and returned when assignments are completed. C. A list of vehicles owned, leased, or otherwise used by the agency and to whom the vehicle is assigned. The Agency leases one vehicle, a 2002 Dodge Caravan. The Agency owns a 2015 Dodge Van. Both vehicles are unassigned and are for Agency use only. D. A list of employee bonuses or awards granted in FY14 and FY15, to date, if any. No special pay or bonuses were granted in FY14 and FY15 (to date). E. A list of travel expenses, arranged by employees. For each such occurrence, list the official event titles, the names and job titles of the individuals who attended the event, the cost (detailed by cost of registration, lodging, airfare, per diems, etc.) of attending the event, the funding source used to pay for each expense, and how participation benefited the agency and its clients. See Attachment 5: Travel Expenses Page 6 of 69

7 6. Please list and describe all employee training provided in FY14 and FY15, to date. In addition, please list and describe all proposed employee training for the remainder of FY15. See Attachment 6: Employee Training. OPC is committed to making training and professional development available to all employees. Currently, OPC employees elect to take trainings on an individual basis, as part of their annual goal setting for each performance year. OPC is actively seeking a grassroots/outreach consultant to train OPC staff in new outreach and community development initiatives. Page 7 of 69

8 7. Does the agency conduct annual performance evaluations of all its employees? If so, who conducts such evaluations? What steps are taken to ensure that all agency employees are meeting individual job requirements? Yes. Managers conduct performance-planning sessions with individual staff members, which provides a basis for evaluating performance. Each team member has 3-5 goals that they are responsible for completing before the end of the evaluation period. Managers conduct evaluations and ensure their assigned staff members are meeting job requirements and performing their principal job functions. Managers also conduct monthly meetings with staff. This enables supervisors to provide feedback on individual performance. The Agency has further enhanced the performance-management system in critical areas of performance planning, performance execution, performance assessment, and performance review through its implementation and utilization of the District Government s e- Performance Management system. All agency employees have FY15 performance plans established via PeopleSoft. OPC encourages and provides opportunities for professional development and training. The Agency offers in-house training through webinars and brown-bag sessions led by staff or experts in emerging utility matters. Professional development and training is essential in ensuring staff members have the requisite skills and training to excel in their roles. The Agency has also instituted a staff-development plan. The plan consists of five required courses offered through the District government Center for Learning and Development (CLD). Page 8 of 69

9 8. Please provide a list of the total overtime payments paid in FY14 and FY15, to date. This answer is provided by OPC s AFO: Overtime payments paid in FY14: $ Overtime payments paid in FY15 to date: $1, Page 9 of 69

10 9. Please provide an explanation of the type of work approved for overtime pay. Please provide a list of employees and the amount of overtime they were paid. This answer is provided by OPC s AFO. See Attachment 9: FY 14 OPC Overtime Payments. Page 10 of 69

11 10. Please provide a list of workman s compensation payments paid in FY14 and FY15, to date. This response prepared by OPC s AFO. No worker s compensation payments have been made in FY14. To date no worker s compensation payments have been made in FY15. Page 11 of 69

12 II. BUDGET 11. Please provide a chart showing OPC s approved budget and actual spending, by program, for FY14 and FY15 to date. In addition, describe any variance between fiscal year appropriations and actual expenditures for FY14 and FY15, to date. This response provided by OPC s AFO. See Attachment 11: OPC FY 14 Approved Budget. Page 12 of 69

13 12. List any reprogramming which occurred in FY14 or which have occurred in FY15, to date. For each reprogramming, please list the total amount of the reprogramming, the original purposes for which the funds were dedicated, and the reprogrammed use of funds. This response provided by OPC s AFO. See Attachment 12: OPC FY 14 Reprogramming. Page 13 of 69

14 13. Provide an accounting of all intra-district transfers received by or transferred from the agency during FY14 or during FY15, to date. This response provided by OPC s AFO. See Attachment 13: OPC FY 14 Intra-District Transfers. Page 14 of 69

15 14. Does the agency anticipate any additional spending pressures for FY15? If so, provide a detailed account of the amount and source of the spending pressures. This response provided by OPC s AFO. The Office of the People's Counsel does not have any spending pressures in FY Page 15 of 69

16 15. Please identify any special purpose revenue accounts maintained by, used by, or available for use by your agency during FY14 or FY15, to date. For each account, please list the following: 1. The revenue source name and code 2. The source of funding 3. A description of the program that generates the funds 4. The amount of funds generated by each source or program in FY14 and FY 15, to date 5. Expenditures of funds, including the purpose of each expenditure, for FY14 and FY15, to date. This response provided by OPC s AFO. See Attachment 15: OPC FY 14 Special Purpose Revenue. Page 16 of 69

17 16. Please provide a complete accounting of all federal grants received for FY14 and FY15, to date. The Office did not receive any federal grants in FY 14 and FY 15 to date. Page 17 of 69

18 17. Have any disbursements been made out of the Settlement and Judgment Fund in FY14 or FY15, to date, arising from a legal claim filed against the District as a result of actions taken by your agency? The Office of the People s Counsel has not made any disbursements from the Settlement and Judgment Fund in FY 14 or FY 15 to date. Page 18 of 69

19 III. PROPERTY AND OTHER FIXED COSTS 18. Provide a list of all properties occupied by OPC in FY14 and thus far in FY15. For each property, what were your total rental costs in FY14 and what have been your total rental costs thus far in FY15? OPC occupied th Street, NW, Suite 500, Washington, DC in FY14 and FY15 to date. This answer provided by the AFO. OPC s rental costs are as follows: FY 14 rental cost $717, FY 2015 YTD cost (as of 1/31/2015) $246, Page 19 of 69

20 19. Provide a list of OPC's fixed costs budget and actual spending for FY14 and thus far in FY15. This response provided by OPC s AFO. See Attachment 19: OPC FY 14 Fixed Costs. Page 20 of 69

21 20. What steps were taken in FY14 and FY15, to date, to reduce the following: Energy use In FY14 OPC replaced its office lighting with LED technology. The replacement lighting provides for an estimated energy efficiency of 80% to 90% when compared to traditional lighting. Utilizing LED technology also provides for reduced replacement costs due to a longer bulb lifecycle and by containing no toxic materials it is ecologically friendly as well as 100% recyclable. Communication costs In FY14 our communications costs remained consistent with FY13 levels when we received a cost savings as a result of upgrading our infrastructure to allow for the use of Session Initiation Protocol (SIP) lines. To date in FY2015, we have partnered with the Office of the Chief Technology Officer (OCTO), to upgrade our telephone lines to fiber optic which will result in reduced line charges to the Agency. Space utilization During FY14 OPC s space utilization remained consistent with its FY13 level. To date in FY15 OPC is re-purposing a portion of its current library space which contains outdated reference material to a more efficient multi-purpose work space. The converted area will provide OPC s Legal Service and Consumer Service Divisions additional space for litigation preparation and the preparation of consumer education materials. Page 21 of 69

22 III. AGENCY PROGRAMS AND POLICIES 21. Please provide the Committee with OPC s last annual report. See enclosed portable drive with all OPC publications, including OPC s 2013 Annual Report. Page 22 of 69

23 22. Please list each program and policy initiative ( program ) of your agency during FY14 and FY15, to date. For each program, please provide: A. A detailed description of the program B. The name of the employee who is responsible for the program C. The total number of FTEs assigned to the program D. The name and title of each employee assigned to the program, including the percent of the employee s time dedicated to the program E. The amount of funding budgeted to the program F. A description of the initiative G. The funding required to implement to the initiative H. Any documented results of the initiative CONSUMVER SERVICE PROGRAM ACTIVITIES OPC Sponsors Public Meeting in Compliance with Language Access Act of 2004 All District residents, regardless of their English proficiency, should understand OPC s mission, services, and assistance options. To this end, and in compliance with the Language Access Act of 2004 ( ACT ), OPC sponsored public meetings in 2013 and 2014 to foster a dialogue between OPC and the District s Spanish-speaking community to improve the Agency s services to this demographic. During the meetings, a formally-trained interpreter assisted OPC by delivering OPC s message in the attendees native language. OPC s principal message was that it provides all D.C. consumers the same type and quality of service regardless of their race, creed, color, religion, or sexual orientation. As required by the Act, OPC convenes at least one public meeting per fiscal year. Responsible Staff: Barbara Burton Silvia Garrick Utility 101 Workshops In response to numerous inquiries from District consumers about utility billing issues and ways to reduce their energy consumption while going green, OPC developed and has hosted numerous Utility 101 Workshops, both in-house and at locations throughout the city. Through these workshops, OPC helps consumers read their utility bills, educates consumers on energy efficiency tips to reduce electric and natural gas consumption and provides advice on managing utility service costs. Responsible Staff: Linda Jefferson Jean Gross-Bethel Cheryl Morse Page 23 of 69

24 Hands-On Citywide Workshop: Making Energy Efficiency and Renewable Energy Real OPC s Consumer Services Division ( CSD ) collaborated with OPC s EES to conduct a one-day, citywide workshop on how energy efficiency and renewable energy issues affect District consumers. It touched on such concerns as making a home more energy efficient, installing solar PV or solar-thermal systems, applying for a homeenergy audit and generally obtaining information on D.C. government energyefficiency and renewable energy programs, including grants and rebates. Responsible Staff: Pamela Nelson Jean Gross-Bethel Nicole Sitaraman Key Community Leaders Briefings CSD holds Key Community Leaders Briefings to brief community leaders on major cases and issues such as Formal Case No (Pepco s Power Line Undergrounding), Formal Case No (the Exelon/Pepco Merger Application), Formal Case No (Pepco s most recent rate case) and Formal Case No (the investigation into the business and solicitation practices of Starion Energy in the District). These events are attended by very influential community leaders who are catalysts for attracting constituents interested in becoming witnesses for the PSC-held public community hearings. Responsible Staff: Herbert Jones Laurence Jones Linda Jefferson CES Representatives Briefings OPC s CES Team continued its series of briefings for competitive energy supplier company representatives. The briefings informed the representatives about the Consumer Bill of Rights regulations that govern energy suppliers sales and marketing practices in the District of Columbia. Responsible Staff: Danielle Lopez Laurence Jones Linda Jefferson Cheryl Morse Chris Sellers Page 24 of 69

25 OPC/AARP Utility Briefings OPC and AARP co-sponsored utility briefings for seniors. The purpose of the briefings was to provide seniors with up to date information on changes taking place in the District s utility markets. OPC staff provided seniors with overviews on the proposed Exelon/Pepco merger, Pepco/DDOT Undergrounding Plan, competitive energy suppliers, and Verizon s copper phone line to fiber optic cable transition. Responsible Staff: Herbert Jones Laurence Jones Energy Efficiency Workshops OPC continued to address the energy efficiency needs of District residents through its hands-on, energy efficiency workshops which educate D.C. ratepayers about simple and practical energy efficiency measures they can immediately apply to their homes for energy savings. OPC s ongoing partnerships and collaborations with other District agencies and private groups ensure that D.C. ratepayers get beneficial energy efficiency and renewable energy information to empower them in making informed energy-saving choices when meeting their energy needs. In 2014 and 2015 to date, OPC conducted approximately 84 energy efficiency workshops, including presentations at churches, mosques, public schools, libraries, and select retail outlets. OPC has collaborated with DC PACE to conduct education and outreach to DC churches to empower churches to do simple and long-term energy efficiency retrofits to their respective church buildings using the DC SEU rebates (where applicable) and DC PACE special financing for major energy efficiency retrofits, such as upgrading aging and inefficient heating and cooling systems to more energy efficient models and solar installations. Responsible Staff: Pamela Nelson LEGAL ADVOCACY AND REPRESENTATION Membership on Sustainable Energy Utility Advisory Board The D.C. Sustainable Energy Utility (SEU) is a private contractor procured by the District of Columbia Government. Its primary purpose is to facilitate the District s ability to reduce its overall electric consumption and meet the goals and objectives established by the Clean and Affordable Energy Act (CAEA). The SEU currently works to fulfill this purpose by providing both short-term and quick-start, energy efficiency products to the public and coordinating long-term market transformation initiatives. Since the creation of the SEU, OPC has been an active member of the Advisory Board. Page 25 of 69

26 The People's Counsel is the Agency's representative on the Board. OPC staff provided research and technical analysis to the People s Counsel for monitoring the SEU s activities. The Advisory Board is responsible for providing advice, comments, and recommendations to the D.C. Council and the District Department of the Environment on the performance and administration of the SEU. The Advisory Board convened for meetings at least five times in FY14. Responsible Staff: Nicole W. Sitaraman, Assistant People s Counsel Yohannes Mariam, Ph.D., Senior Economist Herbert Jones, Manager, External Affairs Barbara Burton, Assistant People s Counsel Pamela Nelson, Energy Efficiency Outreach Specialist Public Service Commission cases Pepco Dynamic-Pricing Proposal (FC 1109/1114) Dynamic pricing is a pivotal component of the emerging smart grid and it is based on the level of usage and demand for electricity. Dynamic pricing is a tool to incent consumers to reduce their energy consumption during periods of peak demand. Creating standards and programs that offer timely, efficient, transparent, and userfriendly means for customers to make adjustments to their energy consumption is critical to enabling them to respond to price signals in an efficacious and costeffective manner. On October 7, 2013, Pepco filed a new dynamic-pricing plan ("Pepco's Dynamic Pricing Plan") with the PSC. On November 29, 2013, the Commission issued a Public Notice inviting comments on the Company s proposal. Pepco s Dynamic-Pricing Plan consists of four principal elements: (1) Peak Energy Savings Credit; (2) tariff revisions that describe the manner of dynamic pricing and the Energy Wise Rewards Program ( EWR ) billing credits will operate for customers who participate in both; (3) a pilot program of residential In-Home Displays ( IHDs ) to convey detailed energy-usage information and dynamic-pricing signals; and (4) a pilot program to reduce remotely the load of window airconditioning units. OPC filed comments with the PSC on Pepco s Dynamic-Pricing Plan in December OPC was generally supportive of Pepco s Dynamic-Pricing Plan; however, the Office had several concerns such as, among other things, (1) the Peak Energy Savings Credit amount needs further evidentiary support; (2) the limited revenue Pepco will likely secure will unfairly burden D.C. ratepayers; (3) the Company should consider offering critical peak pricing and hourly pricing as opt-in programs; and (4) the use of shadow billing should be incorporated and dynamic-pricing benchmarks are necessary. The Commission issued a decision on February 6, 2014, denying Pepco s proposal and opened a new formal case allowing all interested parties to present their perspective on what dynamic-pricing plan would be most feasible for the Page 26 of 69

27 District of Columbia. OPC submitted supplemental comments and participated in the informal investigatory hearing on April 23, Responsible staff: Laurence C. Daniels, Litigation Director Travis R. Smith, Sr., Trial Supervisor Nicole W. Sitaraman, Assistant People s Counsel Community Renewables Energy Amendment Act Proposed Rulemaking (FC 945/1017) In September 2014, the DC PSC released its proposed rules to implement the Community Renewables Energy Act. This new law expands access to renewable energy to more D.C. consumers such as renters, homeowners with shaded roofs, and tenants of apartment buildings. The law represents an important step towards both making clean energy more equitable for District residents and achieving the goals of Mayor Gray's Sustainable DC Plan. OPC played a pivotal role in the drafting, analysis, and review of the Community Renewables Energy Act. The Office was an active participant in the working group convened by the DC Council in 2012, to finalize technical details related to the legislation. OPC submitted clarifying comments on the PSC s proposed rulemaking in October Responsible Staff: Nicole W. Sitaraman, Assistant People s Counsel PJM Interconnection, Inc. Stakeholder Process PJM Interconnection, LLC is the mid-atlantic regional transmission organization that manages the electric grid, coordinates the movement of wholesale electricity, and administers the wholesale electricity market in Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and the District of Columbia. PJM is a non-governmental company that is responsible for planning transmission expansions in the mid-atlantic region, forecasting future loads to be served, maintaining the reliability of the bulkpower system, and administering several energy markets where power is bought and sold to serve load. OPC was involved in the formation of Consumer Advocates of PJM States, Inc. ( CAPS or Consumer Advocates ), a non-profit organization established to serve as a resource for all of the consumer advocate agencies in the PJM region and to represent their interests in PJM proceedings. OPC continues to play an active role in the PJM stakeholder process through its involvement in numerous committees and user groups, such as the Markets and Reliability Committee, the Members Committee, Capacity Senior Task Force, the Public Interest Environmental Organization User Group, and the Regional Planning Process Task Force. Page 27 of 69

28 In FY14, OPC tracked and provided substantive comments on a wide variety of matters pending in the PJM stakeholder process. For example, OPC participated in PJM s stakeholder deliberations regarding its proposed restructuring of the capacity markets through a new capacity performance product. This new product was proposed to address generator performance during peak periods. The PJM Board expedited the process of addressing winter capacity performance by forming a new committee, the Enhanced Liaison Committee ( ELC ), which will focus on developing solutions that would prevent a repeat of the significant non-performance of generators during the extreme winter weather events in 2013/2014. During the 2013/2014 winter, generators failed to provide 40,000 MW of energy during the polar-vortex events, even though they had been compensated for the capacity. OPC, along with CAPS members and numerous other stakeholders, engaged in lengthy discussions regarding PJM s proposal to, among other things, expand penalties for non-performance and provide incentives for generators to ensure their performance during peak demand periods. Additionally, OPC engaged in several committee meetings about how to integrate energy-storage resources into the RPM. Given the growing commercial viability of energy storage, PJM stakeholders are exploring how it can be incorporated in the PJM markets to assist reliability. Further, as part of PJM s triennial review in the Capacity Senior Task Force, OPC, along with CAPS, participated in deliberations regarding proposed changes to Net CONE (Cost of New Entry), the VRR Curve, and Net EAS (Energy & Ancillary Services) Offset. Responsible Staff: Nicole W. Sitaraman, Assistant People s Counsel Yohannes Mariam, Ph.D., Senior Economist Federal Energy Regulatory Commission The U.S. Federal Energy Regulatory Commission ( FERC ) is the federal regulatory agency with jurisdiction over the interstate transmission of electricity, wholesale electric rates, interstate natural gas and oil pipelines, and hydroelectric licensing. Any changes which PJM intends to make to its market rules must first be approved by FERC. OPC is a party to various proceedings before the FERC which have an impact on D.C. ratepayers. Rules established in the wholesale marketplace have a direct impact on retail customer utility bills because generation costs make up the majority of ratepayers bills. Additionally, it is widely believed that the integration of renewable energy in a way which equitably benefits the economic and environmental well-being of all consumers will occur at the interstate transmission level. Responsible staff: Nicole Sitaraman, Assistant People s Counsel Return on Equity (Docket No. EL13-48) Page 28 of 69

29 OPC continued its collaboration with other state consumer advocate offices in this case regarding the end-user advocates complaint challenging the return on equity (ROE) of Baltimore Gas & Electric and Pepco Holdings. Consumer Advocates argued for the reduction of the ROE currently allowed for these utilities. In this and other proceedings, Consumer Advocates contend that the FERC should continue to scrutinize transmission rates with full consideration of all relevant factors, including reduced interest rates and other changing economic conditions. In FY 14, after a period of time in which the case was pending at FERC, FERC ordered the parties to engage in settlement proceedings to attempt to resolve the matters. OPC joined with the other Joint Complainants to participate in the settlement proceedings. Responsible staff: Nicole Sitaraman, Assistant People s Counsel Nick Gumer, Director of Regulatory Finance Capacity Import Limits (Docket No. ER14-503) On November 29, 2013, PJM submitted its plan to establish limits on capacity sales across PJM borders with other RTOs (e.g., MISO) that mirror limits on capacity transfers PJM has already established between zones within the PJM network itself. PJM has presented this proposal out of concern that external resources may clear the RPM but then not take proper steps to ensure that they will be able to deliver the capacity resources needed in the delivery year. PJM is also concerned about overcommitment of external resources in the Base Reliability Auction, which can suppress prices and negatively impact resource adequacy in the PJM region. On December 20, 2013, OPC and the Consumer Advocates filed a Joint Protest with FERC. OPC and the Consumer Advocates generally support filling in gaps in the rules that address underlying reliability constraints but advocate that the Commission must also ensure efficient capacity trade to keep energy consumers costs low. Any limits on externally-sourced capacity resources should not create unnecessary and costly barriers to entry and trade. The primary goal should be efficient trade mechanisms that benefit consumers. For the capacity markets to be efficient, the rules must allow room for the fact that capacity sellers face some uncertainty in the 3-year forward timeframe. In April 2014, FERC granted PJM s proposed tariff changes. Responsible Staff: Nicole W. Sitaraman, Assistant People s Counsel Page 29 of 69

30 Clearing of Limited DR (Docket No. ER14-504) On November 29, 2013, PJM filed changes under section 205 of the Federal Power Act to the PJM Open Access Transmission Tariff and the Reliability Assurance Agreement Among Load Serving Entities in the PJM Region. In short, PJM proposed to change the process by which resources clear in the RPM auction and to place a hard cap on the amount of Limited and Extended Summer DR. Prior to this matter, there was a minimum requirement for Extended Summer and Limited DR. PJM sought to create a maximum-allowed amount of those resources. Also PJM aimed to reduce the Limited Resource Constraint and the Sub-Annual Resource Constraint by 100% of the Short Term Resource Procurement Target (i.e., a 2.5% holdback). OPC joined with other consumer advocates and filed a protest in response to this filing. The joint consumer advocates objected to the limitations being proposed for Extended Summer DR because the proposed cap was inconsistent with results of reliability tests and simulations conducted by stakeholders. Further, they offered an alternative proposal which would protect the reliability value of Extended Summer DR and be substantially less costly than PJM s proposal (PJM s plan would have cost $1 billion annually and the consumer advocates plan would cost $128 million). Most importantly, the joint consumer advocates asserted that PJM had not demonstrated that its proposal would be just and reasonable. PJM simply had not made the case that there was a reliability concern that urgently needed to be addressed through these channels. PJM relied on the assumption that the use of DR resources would have adverse impacts on generation-based capacity resources and this purported negative impact on generation-based resources would then compromise reliability. The joint consumer advocates contended that PJM s proposal unduly discriminated against certain DR bids and would, in fact, cause decreased reliability in the grid. Ultimately, however, FERC found in PJM s favor. Responsible Staff: Nicole W. Sitaraman, Assistant People s Counsel Replacement Capacity in PJM (ER ) On March 31, 2014, the Consumer Advocates joined with other PJM capacity market participants to file a joint protest against PJM s proposed changes to replacement capacity in the Reliability Pricing Model ( RPM ). PJM proposed to place substantial limits on Capacity Replacement to protect against alleged speculation in the capacity market. Capacity Replacement is the process through which companies with capacity committed in the Base Residual Auction replace their obligation through a purchase in one of the Incremental Auctions. In other words, Capacity Replacement is a means through which capacity will be delivered, to keep the lights on, even if there are problems with the delivery of the original source. Page 30 of 69

31 PJM principally asserted that the then-current capacity replacement mechanism was an incentive for arbitrage. OPC joined with other consumer advocates in a joint protest asserting that PJM s concerns about arbitrage and speculation are wildly exaggerated (particularly given demand response s critical role during the winter cold snaps as well as its role in keeping capacity prices lower). The joint protest argued that PJM s proposal should be rejected outright because it was unjust and unreasonable because the impact would be to suppress the entry of demand response into the capacity market. Also, there were many deficiencies in PJM s filing including lack of analytical support for the claim that the proposed changes would improve reliability and the failure to show that any alleged speculation had negatively impacted the market. FERC ultimately rejected PJM s proposal. Responsible Staff: Nicole W. Sitaraman, Assistant People s Counsel Winter Weather Events Technical Conference (AD14-8) On February 14, 2014, OPC joined with several other Consumer Advocates in a letter to FERC expressing concerns regarding the impact of the 2013/2014 cold snaps on consumers. Consumer Advocates argued that the unprecedented energy and ancillary service prices that occurred in January were not reflective of smoothly operating market fundamentals, but were, instead, reflective of significant and systemic inefficiencies. For example, more than 40,000 MW of generation was unavailable during critical periods in January due to forced outages the same generation for which consumers are paying billions of dollars in capacity payments each year so that the generation would be available during peak periods. Also, the letter highlighted that severe constraints on interstate natural gas pipelines contributed, at least in part, to natural gas supply shortages in some areas and historically high prices for natural gas in many areas. Consumer Advocates sent a follow-up letter on March 25, 2014, advising FERC on important issues to be addressed in preparation for FERC s Technical Conference on the winter weather events on April 1, Responsible Staff: Nicole W. Sitaraman, Assistant People s Counsel Offer Cap Waiver (ER ) On January 23, 2014, PJM submitted a request for waiver of certain Operating Agreement and Tariff provisions as necessary to permit Market Sellers to include in their cost-based offers for Generation Capacity Resources the marginal costs of generation of their resource, notwithstanding that those costs exceed the Operating Agreement s $1,000/MWh offer-price cap. OPC joined with other consumer advocates in filing a protest of this petition. Page 31 of 69

32 Responsible Staff: Nicole W. Sitaraman, Assistant People s Counsel Exelon-PHI Merger Application (EC14-96) In July 2014, OPC filed comments regarding Exelon s proposed acquisition of PHI. In its comments, OPC raised several concerns, including the fact that the proposed complex corporate structure resulting from the merger of Exelon and PHI would pose serious challenges for state regulators and consumer advocates. OPC anticipated that the proposed merger would diminish the ability of the DC PSC to ascertain and verify the workings of the Exelon corporate structure and craft orders and regulations that send the appropriate and effective regulatory signals. OPC also raised concern about the influence that a company the size of the proposed post-merger company would be able to exert on the PJM Interconnection, LLC ( PJM ) stakeholder process. By combining so many regulated utilities and unregulated affiliates under one corporate umbrella, the PJM stakeholder process would likely disproportionately reflect the views of one corporation. On November 20, 2014, FERC authorized the merger as consistent with the public interest. Responsible Staff: Nicole W. Sitaraman, Assistant People s Counsel EPA s Proposed Rule on Standards of Performance for Greenhouse Gas Emissions from New Stationary Sources: Electric Utility Generating Units under Section 111(b) of the Clean Air Act ( Proposed 111(b) Rule ) The Proposed 111(b) Rule consists of a two-tiered approach to reducing carbon emissions for new power plants. First, there will be two limits for fossil fuel-fired utility boilers and IGCC units that allow companies a choice between two compliance periods: (1) 1100 lb CO2/MWh gross over a 12 operating-month period; or (2) lb CO2/MWh averaged over an 84 operating month (seven year) period. Second, for natural gas combined cycle units, the proposed limits are (1) 1000 lb CO2/MWh gross for larger units (>850 mmbtu/h); or (2) 1100 lb CO2/MWh gross for smaller units ( 850 mmbtu/h). Also, the Proposed 111(b) Rule calls for any newly constructed fossil-fuel power plants to achieve these new standards through the use of carbon capture and sequestration technology. OPC submitted comments to the EPA on the proposed rule on May 9, Responsible Staff: Nicole W. Sitaraman, Assistant People s Counsel Page 32 of 69

33 DC Council Legislation Renewable Portfolio Standard Amendment In October 2013, OPC submitted testimony to the DC Council Committee on Government Operations on this legislation, which would remove black liquor as a qualifying biomass under the RPS's Tier 1 category of renewable sources. Black liquor is an industrial by-product of the pulp and paper industry. Paper mill facilities located outside the District in states such as Maryland, Ohio, Virginia, Michigan, Pennsylvania and Kentucky burn black liquor to create electricity. They then sell that energy, in the form of renewable energy credits (RECs), to electricity suppliers servicing the District. These RECs are then counted toward the electricity suppliers' obligation under the RPS. OPC supported the overall objective of the legislation given black liquor's negative impact on public health and the environment as well as the rising cost of black liquor RECs in the PJM market. Subsequent to the submission of this testimony, OPC participated in an RPS Amendment Working Group to further refine the draft legislation. Responsible Staff: Nicole W. Sitaraman, Assistant People s Counsel Sustainable DC Omnibus Act In FY 14, OPC submitted testimony to the DC Council Committee on Transportation and the Environment on this omnibus legislation, which contained a suite of bills seeking to codify policies set forth in the City s Sustainable DC Plan. OPC submitted testimony on Title I, Subtitle C of the bill, which sought to amend the Clean and Affordable Energy Act of 2008 by eliminating the function of the SEU Advisory Board. OPC opposed this provision, which was subsequently removed from later drafts of the legislation. OPC later participated in an energy benchmarking working group to deliberate on the section of the legislation focused on enhancing data access for energy benchmarking in the District. This energy benchmarking working group successfully worked together to come to a consensus on how to refine this provision of the legislation. The Sustainable DC Omnibus Act was later passed by the DC Council. Responsible Staff: Nicole W. Sitaraman, Assistant People s Counsel Page 33 of 69

34 23. Did the agency meet the objectives set forth in its performance plan for FY14? Please provide a narrative description of what actions the agency undertook to meet the key performance indicators or any reasons why such indicators were not met. In FY 2014, OPC staff received 3,294 consumer inquiries and complaints. Staff participated in 240 meetings during the fiscal year. In compliance with the Language Access Act of 2004, OPC s meetings included outreach to the NEP/LEP communities. OPC s outreach and education performance measurement for NEP/LEP consumers was not fully met in FY 14. This can be attributed to using attendance as a key performance indicator as opposed to the number of meetings conducted. Indeed OPC held more meetings in FY 14 than FY 13 for the NEP/LEP communities (61 meetings in FY 13 and 72 meetings in FY 14). The measure has been revised for FY 16. Page 34 of 69

35 24. How well is OPC currently meeting the objectives set forth in its performance plan for FY15? Please provide a narrative description of what actions the agency is undertaking to meet the key performance indicators or any reasons why such indicators are not being met. OPC is on course to meet its FY 2015 Performance Plan objectives. To date,, the agency is working diligently to effectively and efficiently assist D.C. consumers with individual complaints and concerns regarding their utility service and bills on both an informal and formal basis. OPC staff is also conducting consumer education events, which includes outreach to non-english speaking and senior consumers. In addition to its regular consumer education program, OPC is partnering with AARP to conduct educational workshops to seniors to educate them on competitive energy suppliers ( CES ). As a component of its CES monitoring program, OPC staff has and continues to schedule meetings with CES company representatives to discuss regulations governing sales and marketing to District consumers. OPC has also held briefings for consumers on the Exelon/Pepco merger and Pepco/DDOT Undergrounding Plan. In addition, OPC has provided educational briefings on WGL s Accelerated Pipeline Replacement Program and Verizon s transition from copper to fiber optic cable to consumers and community leaders. Page 35 of 69

36 25. Please describe any initiatives of your agency implemented in FY14 or thus far in FY15, to improve the internal operation of the agency or the interaction of the agency with outside parties. Please describe the results, or expected results, of each initiative. If the results fall into the expected category, please provide a timeline explaining when the results can be expected. To improve internal agency operation, OPC hired a Chief Operations Officer to oversee and manage the administrative operation of the agency; as well as upgraded its telecommunications and computer systems. In efforts to foster a culture of inclusion and clear communication, the agency has begun holding regular, more comprehensive agency-wide staff meetings where the activities of all divisions and individuals are presented and discussed, in addition to holding more consistent divisional meetings. To further foster strong staff morale and collaboration for greater achievement of agency goals, OPC executive management hosted two staff appreciation lunches. Also note that to facilitate the establishment of clear performance expectations, managers took performance management training hosted by DCHR s Center for Learning and Development (CLD). In addition, OPC obtained expert guidance on how to enhance internal agency operations: Ivy Planning Group FY14 OPC engaged the services of the Ivy Planning Group to perform a culture survey and assessment to provide the Agency a baseline understanding of the challenges and opportunities to operating as a high-performing team. As a result of the assessment and survey, OPC would receive recommendations for addressing any revealed issues, leveraging opportunities, and managing any resulting change. The resulting recommendations, agreed to by agency staff included: Create an agreed-to culture ( One OPC ) to be characterized by inclusion, trust, and clear communication; Establish clear performance expectations and hold everyone accountable; Leverage employees connection to the OPC mission to motivate internal change. Novatric FY14 Novatrics worked with OPC for the purpose of proposing an organizational structure that facilitated and fostered appropriate executive level decision making and effective management; identify systemic flaws to the organizational structure and recommend corrective action; review position descriptions for consistency with actual on-the-job work proposals; and examine OPC s organizational chart, strategic plan and organizational structure and propose direction, if needed, for a reorganization to achieve best staff alignment to conform with the Agency s mission/vison and executive decision making. Page 36 of 69

37 The resulting recommendations included: Creating an organizational chart that provides for a flatter organization, more concrete functional alignment with OPC s mission, vison and goals; Establish and fill a Chief Operating Officer ( COO ) position and consolidate all administrative functions under the COO to include HR, Budget and Finance, Contracts and Procurement and MIS/IT functions and positions. Review all positions and position descriptions and ensure the proper alignment and reporting structure to provide for the most effective and efficient execution of the Agency s mission, vision and goals. Page 37 of 69

38 26. Please provide a copy of all publications, brochures, and pamphlets prepared by or for the agency during FY14 and FY15, to date. See enclosed portable drive with all OPC publication for FY 14 and FY 15 to date. Page 38 of 69

39 27. Please provide a copy of all policy statements issued during FY14 and FY15, to date. See Attachment 27: OPC Policy Statements. Page 39 of 69

40 28. Please list and describe any ongoing or completed investigations, studies, audits, or reports on your agency or any employee of your agency during FY14 or FY15, to date. D.C. Code (a)(1) established the OPC Agency Fund as a fiduciary fund in the District of Columbia Treasury. D.C. Code (a)(2) requires any public utility applying to the PSC for a rate or regulatory change to deposit sufficient dollars, as determined by the OPC and approved by PSC, into the OPC Agency Fund to cover OPC's reasonable and necessary expenses pertaining to an application. These deposits must be used exclusively for the payment of expenses arising from any investigation, valuation, revaluation, or proceeding and all expenses of any litigation, including appeals arising from decisions, orders, or other actions. As required by law (above), the Office of the District of Columbia Auditor conducted an audit of the fiscal years (FY) 2009, 2010, 2011 and 2012 financial activities of the Office of the People's Counsel (OPC) Agency Fund in FY 2013 and offered four recommendations. These recommendations were reflected in the FY13 oversight responses and have been implemented. All requested reports have been submitted to the D.C. Auditor. The Office of Human Rights is conducting an investigation of a current employee s claim of discrimination. The investigation is ongoing. Page 40 of 69

41 29. Please identify any recommendations regarding OPC made by the Office of the Inspector General or the D.C. Auditor during FY14 or thus far in FY15. Please note what actions have been taken to address these recommendations. This answer provided by the AFO. See attachment 29, FY 14 D.C. Auditor Recommendations. Page 41 of 69

42 30. Please explain how any possible or anticipated changes in the energy market will or could have affect the function of your agency. PJM Interconnection, Inc. has submitted a proposal to the Federal Energy Regulatory Commission to restructure its capacity market through the creation of a new capacity performance product. If approved, ratepayers in the PJM footprint would bear the projected $1 billion cost of implementing the new capacity framework. OPC believes that this new capacity product would impose significant costs on residential and commercial consumers with little assurance of any commensurate benefits. Further, last year, the U.S. Environmental Protection Agency (EPA) promulgated two proposed rules regarding carbon emissions: section 111(b) and section 111(d) of the Clean Air Act. Section 111(b) sets forth greenhouse gas emission limits for newly-constructed power plants. It calls for any newly constructed fossil-fuel power plants to achieve these new standards through the use of carbon capture and sequestration technology (CCST). The integration of CCST presents concerns for ratepayers given its still nascent role in the marketplace and expensive costs. The EPA s proposed 111(d) rule would establish carbon-emission guidelines for existing power plants. The EPA did not propose a stateemission goal for the District of Columbia because the District lacks the requisite fossilfuel electric generating units subject to the Clean Power Plan. Nevertheless, once finalized, the rule will impact the District because it allows for regional, inter-state approaches for measuring reduced greenhouse gas emissions. Local governmental energy stakeholders, such as DDOE, the PSC and OPC, will be engaged in ongoing discussions regarding how our jurisdiction may be able to contribute to the goals of the EPA s carbon emissions rules. In addition, OPC anticipates there will be growing consumer demand for distributedgeneration and renewable-energy options such as community-shared solar and microgrids in DC. These represent positive changes that will advance the Agency s and the City s sustainability agenda. However, adopting these changes in a more widespread fashion will not come without challenges. OPC will be heavily involved in ongoing discussions and advocacy around issues such as the best rate design for solar in the future and regulatory barriers related to the deployment of microgrids in the District. Page 42 of 69