4107.1 Within ninety (90) days of the conclusion of each year of SOS bidding, the Electric Company shall submit a report to the Commission on its wholesale electric supply procurement process and results, SOS retail prices produced, and on the aggregated SOS enrollment activity for each service class (including the number of customers, megawatt peak load, megawatt hour energy and switching to and from the service) and a report of all true-ups conducted for that year. This requirement is not intended to replace or supersede any other reporting requirements imposed by the Commission on the Electric Company.

4107.2 If the Electric Company conducts wholesale bidding for a type of service on the basis of aggregated rate classes, the Electric Company shall make any needed true-ups on an aggregated basis.

4107.3 In addition to the other true-ups described herein, the Electric Company shall true-up its total costs for providing each type of service (Residential, Small Commercial, and Large Commercial) with its total billed revenues for that service. If the service type is still being provided when the true-up is completed, rates will be adjusted to reflect any over- or under-recoveries established in the true-up. In the event that there is any net over- or under-collection at the end of any type of service (Residential, Small Commercial, Large Commercial), the balance will be paid or collected through a mechanism to be determined in accordance with the procedures set forth in Section 4107.13. All retail price changes resulting from the true-up filings shall be reviewed annually by the Commission.

4107.4 The Electric Company will conduct the true-ups described herein to reflect the start of summer rates and concurrent with the start of non-summer rates. The Electric Company may conduct more frequent true-ups if it so chooses. Any revisions to retail electric rates resulting from the application of the true-up provisions shall be reflected in the prices posted on the Electric Company's web page. The true-ups are subject to audit by the Commission.

4107.5 The Electric Company shall true-up its billings to retail customers for services provided pursuant to Section 4103.1(a) against its payments to wholesale suppliers. The Electric Company shall also true-up its billings to retail customers to reflect any net damages recovered by the Electric Company from a defaulting supplier in accordance with Section 4110.3. The Commission will audit true-ups annually. In the event that there is any net over- or under-collection at the end of any type of service (Residential, Small Commercial, Large Commercial), the balance will be paid or collected through a mechanism to be determined in accordance with the procedures set forth in Section 4107.13.

4107.6 For the purpose of determining such true-up, the Electric Company's payments to its wholesale suppliers shall exclude payments made with respect to the upward

adjustment in the suppliers' load arising from the activation of the Electric Company's load response programs.

4107.7 The retail price to Residential, Small Commercial, and Large Commercial customers posted pursuant to Section 4103.7 shall not change until after the first billing cycle following the start of service. Any difference between the Electric Company's incremental cost for serving SOS load and the Electric Company's revenue from serving SOS load based on the awarded bid prices shall be included as part of the retail rate true-up.

4107.8 Price Elements - Section 4103.1(a) shall include the additional costs (if any) that a wholesale supplier incurs in meeting any future statutory renewables requirements with respect to Residential, Small Commercial, and Large Commercial SOS. In the event that legislation is enacted that provides for a renewable energy resource requirement during the term of any WFRSA that has already been executed, wholesale suppliers under the WFRSA may pass through their commercially reasonable additional costs, if any, associated with complying with the new requirement.

4107.9 If at any time any additional price elements resulting from a change in law and directly related to the SOS are identified by the Electric Company or a wholesale supplier, the Electric Company and/or the wholesale supplier may file a request with the Commission (with notice to all the Parties) for approval of recovery of those costs and, to the extent the costs are found to be incurred because of a change in law in connection with the provision of SOS and are prudently incurred as determined by the Commission, the costs will thereafter be included in the service price.

4107.10 The net costs included in retail prices pursuant to Section 4103.1(b) shall be recovered on a cents/kWh basis (energy basis) for non-demand tariff schedules and/or on a $/kW basis (demand basis) for demand tariff schedules. However, the Electric Company may request Commission approval to use alternate rate designs to recover NITS-related costs. The Electric Company may true-up its billings to retail customers for transmission services provided pursuant to Section 4103.1(b) against its payments for these services to PJM. The Commission may audit these true-ups annually. In the event that there is any net over- or under-collection at the end of any type of service (Residential, Small Commercial, Large Commercial), the balance will be paid or collected through a mechanism to be determined in accordance with the procedures set forth in Section 4107.13.

4107.11 To the extent not already recovered through the PJM Network Integration Transmission Service charges, any future surcharges assessed to network transmission customers for PJM-required transmission enhancements pursuant to the PJM Regional Transmission Expansion Plan, or for transition costs related to elimination of through-and-out transmission charges will be included in the charges under Section 4103.1(b). Pursuant to the WFRSA, the wholesale

suppliers bear the risk of any other changes in PJM products and pricing during the term of their WFRSAs. Subject to the transmission rate deadband specified in Section 4103.1, the Electric Company will not bear the risk of any changes in regulation or PJM rules related to such costs or charges. However, if there are any other new FERC-approved PJM transmission charges or other new PJM charges and costs charged to network transmission customers, the Electric Company may recover them through retail rates:

(a) The Electric Company will file with the Commission, and provide notice to all parties to the proceeding, a request for approval to recover such new charges through the Electric Company's retail rates under Section 4103.1 (b); and

(b) The wholesale supplier will charge the Electric Company only for those new costs that the Commission determines may be recovered in rates by the Electric Company. In no event will the Electric Company bear the risk of any changes in regulation or PJM rules related to such costs or charges. Also, in no event shall any PJM charges to other than network transmission customers be recovered through the Electric Company's retail transmission rates for SOS service, except to the extent (if any) provided in Section 4103.1.

4107.12 The actual administrative costs for a given SOS year shall be used to true-up the estimated administrative costs for that same year, and any over- or under-collection of costs shall be applied to the estimated administrative costs for the next SOS program year for each SOS Customer Group. The Commission may audit such true-ups annually.

4107.13 At the end of any SOS period for a Customer Group, and after actual costs incurred by the Electric Company pursuant to Section 4103.1 have been determined, the parties to the proceeding will agree upon a mechanism with respect to actual costs, to return any over-collection to, and to collect any under-collection from, all active customers who would have been eligible for the service type at the conclusion of any service type period. If the parties to the proceeding fail to agree within a reasonable period, the matter will be submitted to the Commission for decision.

Source: Final Rulemaking published at 56 DCR 5404, 5415 (July 3, 2009).