Translator Disclaimers
Basic Generation Service (BGS)
Pursuant to the Electric Discount and Energy Competition Act of 1999 (Act), the local electric distribution companies (EDCs or Utilities) are obligated to provide basic generation service (BGS) until the Board determines that it is no longer necessary. BGS refers to the EDCs’ obligation to obtain and provide the supply of electricity for customers who do not switch to an alternative retail supplier known as a Third Party Supplier (TPS). The Act requires that power procured for BGS by a Utility be purchased at prices consistent with market conditions. The charges assessed to customers for BGS are regulated by the New Jersey Board of Public Utilities (Board), and are based on the reasonable and prudent cost to the Utility of providing the service, including the cost of power purchased at prices consistent with market conditions by the Utility in the competitive wholesale marketplace, and related transmission, capacity, ancillary and administrative costs as determined by the Board.
BGS Procurement Proceeding
Each year the Board initiates a proceeding that directs the EDCs, and invites interested parties, to file proposals by July to determine how to procure supply to meet BGS load for the next year.  To implement the review process, a procedural schedule is developed to address the proposals, including an opportunity for the issuance of discovery, and submission of written and oral comments.   Based on the record developed in this proceeding, the Board makes a decision as to which type of procurement process will be used for BGS.  Anyone wishing to provide written comments during a BGS proceeding or to receive BGS information may subscribe to the BGS E-Service List by emailing Frank Perrotti at Frank.Perrotti@bpu.state.nj.us with "Subscribe to BGS E-Service List” in the subject matter.
BGS Procurement Process
Each year since 2002, the four New Jersey EDCs - Public Service Gas & Electric Company (PSE&G), Atlantic City Electric Company (ACE), Jersey Central Power & Light Company (JCP&L), and Rockland Electric Company (RECO) - have proposed and ultimately procured several billion dollars of electric supply to serve their BGS customers through a statewide auction process held in February of each year. Starting in 2003, the needs of residential and smaller commercial customers, who are on a fixed-price service, have been met through a statewide auction called the BGS-FP Auction, while the needs of larger commercial and industrial customers, who receive a mandatory hourly-priced service, have been met through a second and concurrent statewide auction called the BGS-CIEP Auction. Each of these Auctions currently utilizes a descending clock auction format that is run by the Utilities and overseen by the Board. NERA has been the EDCs’ auction manager, and has assisted the four EDCs in formulating the design of the auctions and has managed the process each year on their behalf. For more information regarding the BGS auction process you can visit the NERA BGS Auction website at http://www.bgs-auction.com/default.asp.
Basic Generation Service Procurement Process
By prior Board Orders in Docket No. ER10040287 dated December 6, 2010, and Docket No. EO11040250 dated November 9, 2011, the Board approved, with modifications, the joint BGS proposals of the EDCs that used a descending clock auction format to procure two-thirds of the State’s BGS requirements for Fixed-Price (FP) BGS customers for 36 months for periods extending to May 31, 2015. In those prior Orders, the Board did not address how the remaining BGS requirements for FP customers, as well as the State’s annual BGS requirements for Commercial and Industrial Energy Pricing (CIEP) customers, would be procured for the period beginning June 1, 2013.

 

The Board has initiated a proceeding using the following procedural schedule directing the EDCs, ACE, JCP&L, PSE&G, and Rockland, to file proposals no later than July 2, 2012, addressing how to procure the remaining one third of the State’s BGS FP requirements and the annual CIEP requirements for the period beginning June 1, 2013.  In addition, the Board also invites all other interested stakeholders to file alternative BGS proposals with the Board by July 2, 2012.

 

2014 BGS Schedule

 

DATE

Activity or Decision Point

7/01/2013

Filing of  Proposals and/or Modifications for BGS for the period beginning June 1, 2013

7/19/2013

Discovery request deadline

8/02/2013

Discovery response deadline

8/30/2013

Deadline for Initial Comments on all proposals

TBA

Legislative-type Hearing*

TBA

Public Hearings*

9/27/2013

Deadline for Final Comments**

Nov 2013

Expected Board decision on BGS proposals

Nov/Dec

EDC Compliance Filing

Dec 2013

Expected Board decision on Compliance Filing

Feb 2014

Procurement Process for BGS Supply requirements

* This is a placeholder for public hearings (time and place to be scheduled by the EDCs in conjunction with the BPU), as required.

** Final comments should only be used to respond to issues raised either in the Initial comments, Reply Comments or the Legislative-type hearing. They should not be used to raise new issues in this proceeding.