Market Plan in Retail Organization by cmn33360

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									Retail Market Opening Plan
Key activities and milestones to market opening
on May 1, 2002
January 28, 2002




Issue 1.0
Retail Market Opening Plan




Table of Contents
TABLE OF CONTENTS ........................................................................................................................ 1
1   INTRODUCTION .......................................................................................................................... 2
1.1   Document Scope ..................................................................................................................... 2
1.2   Document Structure ................................................................................................................ 2
2      MARKET OPENING STAGES....................................................................................................... 3
3      DISTRIBUTOR REPORTING MILESTONES ................................................................................. 6


APPENDIX A: GANTT CHART
APPENDIX B: ACTIVITY DESCRIPTIONS




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Retail Market Opening Plan




1 Introduction
In January 2000, the Ontario Energy Board (OEB) published the Retail Market Readiness Plan,
which largely focused on the activities required for distributors to become ready for self-
certification on December 14, 2001. Now, with a May 1, 2002 market opening date set by the
Ontario Government, this framework has been updated to focus on the activities required to open
the electricity market to retail competition.
This plan is intended to provide the industry with a guide to the activities that must be undertaken
to facilitate a smooth transition to competition. The schedules of individual organizations will vary,
but participants should aim to align with this overall framework at key milestones. Where there are
mandatory requirements associated with milestones, these are set out in Appendix B – Activity
Descriptions.


1.1 DOCUMENT SCOPE
This document focuses on activities needed for the opening of the retail electricity market,
particularly those activities that the participants, distributors and retailers, need to complete to
properly interact at market opening. Wholesale activities have not been included in this document.
Readers should refer to the IMO plan for more detail on these tasks and milestones
(www.theimo.com/imoweb/implementation/mktReadinessSched.asp).
Activities of other organizations, including EBT hubs, are identified where those activities involve
cooperation and interaction with distributors and retailers. Individual preparation activities of these
organizations are not included.


1.2 DOCUMENT STRUCTURE
The remainder of the document describes the overall framework for opening of the retail market
and the key reporting milestones for distributors. In addition, there are two appendices:
    •   Appendix A includes the Market Opening Gantt Chart.
    •   Appendix B provides more detailed activity and task descriptions in support of the Gantt
        chart.




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     Retail Market Opening Plan




     2 Market Opening Stages
     This section outlines the framework for the retail market opening plan. More detailed activities for
     the retail market follow in the appendices to this document.


Define Baseline


         Participant System and Organizational                   Participant System
                      Preparations                                    Migration


           Data                    Duplicate Enrolment             Pre-Enrolment                 Market
         Scrubbing                     Resolution                   Processing          Opening & Initial Operation


                         Inter-Organization Arrangements


                                 Retail Participant Testing


                                                                   Contingency
                                                                  arrangements



                                       Retail Market Opening Framework


     1. Define Market-Opening Baseline
     This includes the definition, release and communication of the market-opening baseline. This
     baseline includes documents that define the design of the retail market and sets out the document
     versions to be used for market opening.


     2. Individual Participant Preparations
     In advance of market opening there are numerous activities that each participant will need to
     accomplish to prepare their organization for the opening which are largely independent of the other
     market participants.

         Participant Systems and Organizational Preparations – The preparations include both the
         systems and procedural preparations that an organization must undertake to satisfy the
         requirements for participation in the retail market. During the period prior to market opening,
         participants will need to:
         • Review, implement and test the changes to the market design as set out in the market-
             opening baseline.



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Retail Market Opening Plan




    •   Define and document the business processes and procedures that will be used in the open
        market.
    •   Train users on both the new and revised business procedures as well as any additional
        systems training required.

    Participant System Migration – Following the systems and organizational preparations, market
    participants will need to cutover to the new or modified systems. The cutover of the systems
    needed for the processing of service transaction requests is required prior to the start of the
    enrolment pre-processing activity. The cutover of the remaining systems, including the loading
    of new rates into systems, is required in time for market opening.


3. Enrolment Cleanup
Over the last two years retailers have been actively signing consumers to be enrolled at market
opening. During this time several events have occurred which will potentially impact the retailers
ability to process these enrolments at market opening. For instance, the amalgamation of a large
number of distributors has resulted in a change to the customer account numbers required to
process an enrolment. A second factor that further complicates the situation is the existence of
multiple contracts signed by consumers. In order to limit the complications that may arise as a
result of this, distributors and retailers are mandated by the Retail Settlement Code to follow an
enrolment cleanup process. This process will consist of the following three activities:
    Data Scrubbing – In this activity, distributors correct the retailer’s customer / enrolment data
    for service transaction requests to be processed in the pre-market processing period.
    Multiple Contract Resolution – Using the “clean” data from the data scrubbing activity, the
    retailers will then undertake the resolution of multiple contracts.
    Pre-Market Processing – The outputs of the data scrubbing and multiple contract resolution
    activities will then be used as input in the Pre-Market Processing activity. This activity will
    consist of two tasks. First the retailers will request historical usage and payment information
    from distributors through EBTs. Following this, retailers will submit enrol request transactions
    to be processed by distributors.
Refer to the Enrolment Cleanup Approach on the RMR website for more details on enrolment
cleanup. Chapter 14 of the Retail Settlement Code sets out the regulatory filings and procedures.


4. Inter-Organization Arrangements
Inter-organization arrangements include a variety of commercial arrangements between
organizations other than the IMO that must exist prior to market opening. Specifically, these
arrangements include:

    •   Service Agreements – During the period prior to market opening participants will be
        required to finalize the required service agreements between distributors and retailers
        expecting to operate in the distributor’s service area.
    •   Prudential Requirements – Subsequent to the signing of service agreements, retailers and
        distributors will also need to resolve the prudential requirements between their
        organizations in accordance with the requirements of chapter 8 of the Retail Settlement



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Retail Market Opening Plan




        Code and the Service Agreement. To accomplish this the retailers will need to forecast the
        number of customers in each distributor’s territory and communicate this to the distributor.
        The distributor and retailer will then agree on a prudential for the retailer to post. It is
        anticipated that this information will be provided as a result of the enrolment clean-up
        process.

The completion of the service agreement between a retailer and distributor is the key requirement
for the commencement of enrolment processing.


5. Retail Participant Testing
Retail participant testing confirms that distributors and retailers can interoperate through the
various EBT Hubs and similar service providers. All mandated testing activities should have been
completed prior to the second self-certification filing. If this was not achieved, participants should
continue to conduct these testing activities. This would be particularly beneficial for the distributor
- retailer combinations where a high volume of enrolments is anticipated. While it is not mandated,
it is strongly recommended that retailers and distributors undertake tests using their ready systems.


6. Contingency Arrangements
Contingency arrangements will be put in place to provide for Distributors who are unable to
support the new trading arrangements on May 1, 2002. Distributors who follow contingency
arrangements will request a contingency rate from the OEB which they will use in the calculation
of bills.


7. Market Opening and Initial Operations
As announced by the Government of Ontario, the market will open on May 1, 2002. On the first
day of the market retail contracts will start to take effect in accordance with the requirements of the
Retail Settlement Code, chapters 10 and 14, and the remaining customers will begin to receive
standard supply service.




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Retail Market Opening Plan




3 Distributor Reporting Milestones
The Retail Market Opening Plan specifies up to six reporting milestones prior to market opening
where distributors may need to report to the OEB.

Market Readiness Milestones
M1 Submission of Outstanding Signed Self-Certification Statements (Jan.)            January 14, 2002
M2    Submission of Outstanding Signed Self-Certification Statements (Feb.)         February 14, 2002
M3    Submission of Outstanding Signed Self-Certification Statements (Mar.)         March 14, 2002
M4    Submission of Outstanding Signed Self-Certification Statements (Apr.)         April 14, 2002


As per the December 1, 2001 amendment to the Retail Settlement Code (section 13.3.5), the market
readiness milestones are only required for distributors that failed to sign the second self-certification
statement by December 14, 2001. Similarly, distributors are only required to meet the market
readiness milestones up to the date that they do sign the second self-certification statement.


Contingency Arrangements Milestone
M5 Submission of Request for Contingency Rate                                       March 14, 2002


The contingency arrangement milestone is intended for those distributor who feel that they may not
have completed all preparations required in advance of the market opening and as such may require
the contingency rate. Distributors should request a contingency rate by March 14, 2002 to be assured
that a rate will be provided to them by the OEB by April 1, 2002.


Market Opening Milestone
M6 Market Opening Certification                                                     April 1, 2002


All distributors should inform the OEB prior to market opening whether they will be able to meet
the market-opening milestone. This notification is intended to provide consumers and retailers with
information regarding supply arrangements at market opening.




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Appendix A: Retail Market Opening Plan


                                                                                             January                February               March                  April                    May
Retail Market Opening Activities
1       MARKET OPENING BASELINE
1.1     Define Market Opening Baseline                                                                                          Baseline version 2.1 released


2     INDIVIDUAL PARTICIPANT PREPARATIONS
2.1   Market Readiness Activities
2.1.1   Complete Self Certification - Second Filing
                                                                                                  M1                       M2                   M3                    M4
2.2   Participant System and Organization Preparations
2.2.1  Implement Market Opening Baseline Changes                                                                                          All participants EBT 2.1 compliant
2.2.2  Document Business Processes and Procedures
2.2.3    Staff Training (Business Process and Systems)

2.3     Loading of new rates into systems                                                                                                                                             Rates for Market Opening Implemented


2.4     Cutover to new systems by market participants                                                                                                                                 Systems migrated to production
                                                                                                                                                           M6

3       ENROLMENT DATA CLEANUP
3.1     Data Scrubbing                                                                                                                    Enrolment data cleansed


3.2     Multiple Contract Resolution                                                                                                                 Multiple contracts resolved


3.3     Pre-Market Processing                                                                                                                                                         Pre-market processing complete


4       INTER-ORGANIZATION ARRANGEMENTS
4.1     Distributor-Retailer Service Agreement                                                                                  Service Agreements Signed


4.2     Retailer Prudential Posting                                                                                                                                   Retail prudentials posted


5       RETAIL PARTICIPANT TESTING
5.1     Inter-Participant Testing

6       CONTINGENCY ARRANGEMENTS
6.1     Implement Contingency Arrangements                                                                                                                                            Contingency Arrangement Implemented
                                                                                                                                                M5
7       MARKET OPENING AND INITIAL OPERATION
7.1     Stability Period                                                                                                                                                                          Enrolment Stability Period Ends
7.2     Market Opens
                                                                                                                                                                                      Market Opens




        Distributor Reporting Milestones                                                 Legend
        M1 = Submission of Outstanding Signed Self-Certification Statements (January)
        M2 = Submission of Outstanding Signed Self-Certification Statements (February)                 Distributor activity                                     Interim activity milestone
        M3 = Submission of Outstanding Signed Self-Certification Statements (March)
        M4 = Submission of Outstanding Signed Self-Certification Statements (April)                    OEB activity                                             Activity Completion
        M5 = Sumission of Request for Contingency Rate
        M6 = Market Opening Certification                                                              Retailer Activity                                        Distributor reporting milestone

                                                                                                       Retailer and Distributor Activity




Issue 1.0                                                                                                                                                                                                                           January 28, 2002
Appendix B: Activity Descriptions
Appendix B: Retail Market Opening Plan



1 Market Opening Baseline

1.1 Define Market Opening Baseline
Activity          On December 21, 2001, the OEB released Baseline 2.0. This baseline included all
Description:      documents that define the design of the retail market and specified the document
                  versions to be used for market opening. These documents include:
                  • Retail Settlement Code
                  • EBT Standards Documentation
                  • Standard Supply Service Code
                  • Electricity Distribution Rate Handbook
                  • Accounting Procedures Handbook
                  • Affiliate Relationships Code for Electricity Distributors and Transmitters
                  • Distribution System Code
                  • Transmission System Code

                  The OEB will manage the definition and communication of any further refinements to
                  the market-opening baseline.


Outputs:          Activity Completion:

                  A Set 2.1 baseline, including the IMO’s market opening baseline documents, will be
                  released by February 15, 2002. .




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Appendix B: Retail Market Opening Plan



2 Individual Participant Preparations
2.1 Market Readiness Activities
Activity          Under the Retail Settlement Code (section 13.3.5) distributors who have not signed
Description:      the self-certification statement are required to report monthly to the OEB on their
                  progress as per chapter 13 of the Retail Settlement Code. This requires the
                  distributors to submit a signed statement and questionnaire or a letter updating their
                  status and expected self-certification date on a monthly basis.


Outputs:          Activity Completion:
                  • Complete Self-Certification Questionnaire
                  • Signed Self-Certification statement


Reporting         M1 –Distributors that have not self-certified are required to report their progress on
Milestones:       January 14, 2002.

                  M2 –Distributors that have not self-certified are required to report their progress on
                  February 14, 2002.

                  M3 – Distributors that have not self-certified are required to report their progress on
                  March 14, 2002.

                  M4 – Distributors that have not self-certified are required to report their progress on
                  April 14, 2002.


Comments:         This activity is only for distributors who did not sign the self-certification statement
                  in their second self-certification filing due December 14, 2001.

                  Distributors are required to submit either:
                      - A signed readiness statement and an updated questionnaire, or
                      - A statement detailing the extent to which all necessary systems and
                          organizational preparation have been completed as well as an estimate
                          regarding the additional time required to prepare for market opening.




2.2 Participant Systems and Organisational Preparations
Activity          This activity represents the design, development and testing of systems and
Description:      procedures within a participant.

                  Required functions for a distributor include:
                  • Retail Settlement
                  • Enrolment
                  • Billing
                  • Metering



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Appendix B: Retail Market Opening Plan


                  •   EBT interface

                  Specifically this will include the following activities:
                  • Development and testing of systems changes for market-opening baseline
                      compliance;
                  • Definition and documentation of business processes and procedures; and
                  • Staff training for both systems and business procedures.


Outputs:          Activity Completion:
                  • All participants must have EBT 2.1 compliant systems by March 21, 2002 to
                      facilitate the requirements of chapter 14 of the Retail Settlement Code.


Comments:         For embedded distributors that decide to take electricity from their host, the
                  required host settlement functions are considered to be included in this activity.



2.3 Loading of New Rates into Systems
Activity          Distributors will need to load new rates and rate structures into their billing systems
Description:      prior to market opening. All market-opening related rate orders were issued by the
                  OEB in December 2001.


Outputs:          Activity Completion:
                  • Implementation of rates in billing system by May 1, 2002.




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Appendix B: Retail Market Opening Plan




2.4 Cutover to new systems by market participants
Activity          This activity represents all of the preparations required for participants’ systems to
Description:      be functional at market opening. This includes both the conversion of data as
                  required and the migration of systems to production environments.

Dependencies:     The completion of this task is dependent on the following criteria:
                  • Distributors ability to complete system and organizational preparations such as
                      the implementation of market-opening baseline changes (see tasks 2.2
                      Participant System and Organizational Preparations)
                  • Distributors ability to implement the approved rates for market opening (see
                      task 2.3 Loading of New Rates into Systems)


Outputs:          Activity Milestones:
                  • Participants should aim to have the ability to process the EBTs required for the
                      pre-enrolment processing (see task 3.3 Pre-Enrolment Processing) by March 1,
                      2002.

                  Activity Completion:
                  • Systems are implemented and production ready for market opening by May 1,
                      2002.


Reporting         M6 – By April 1, 2002, distributors are expected to inform the OEB of their
Milestones:       readiness for the May 1, 2002 market opening. This filing will indicate whether the
                  distributor will have all systems and procedures in place to participate in the open
                  market or whether they will be on a contingency arrangement.




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Appendix B: Retail Market Opening Plan



3 Enrolment Data Cleanup

3.1 Data Scrubbing
Activity          Market participants must address the large number of pending enrol requests and
Description:      the potential for the existing enrolment data (e.g. account number) to be erroneous.


Outputs:          Activity Milestones:
                  • Retailer’s final opportunity to send file of consumer enrolments to distributors
                      on January 25, 2002.
                  • Distributors must evaluate and reconcile the retailer files they receive and
                      provide “scrubbed” data back to the retailers by February 8, 2002.

                  Activity Completion:
                  Retailers and distributors then have until February 28, 2002 to resolve any
                  exceptions resulting from the distributors reconciliation.

                  These activities and milestones are mandated in chapter 14 of the Retail Settlement
                  Code.




3.2 Multiple Contract Resolution
Activity          To facilitate a smooth market opening, all multiple contracts held by retailers need
Description:      to be identified and resolved prior to pre-processing enrol requests. Retailers will
                  submit a file containing data for all signed customers to an independent party who
                  will in turn identify the multiple contracts and determine which retailer will process
                  the request prior to market opening. Retailers who do not process the enrolment in
                  advance may submit the request for processing following the market opening
                  stability period.


Dependencies:     The multiple contract resolution task is dependent on the “scrubbed” data files from
                  the data scrubbing process (see task 3.1 Data Scrubbing).


Outputs:          Activity Milestone:
                  • Retailers must provide files to third party service provider by March 5, 2002.

                  Activity Completion:
                  • Returned files containing the “approved” enrolments for each retailer by March
                      15, 2002.

                  This activity and milestone is mandated in chapter 14 of the Retail Settlement
                  Code.




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Appendix B: Retail Market Opening Plan

Comments:         Retailers who failed to participate in the multiple contract resolution process are
                  precluded from submitting enrolments in Pre-Market Opening Enrolment
                  Processing as per chapter 14 of the Retail Settlement Code.




3.3 Pre-Market Processing
Activity          Retailers and Distributors will process all enrolment requests prior to the opening
Description:      of the market. Approved enrol requests must be submitted by the retailers to the
                  distributors using the EBT standards as defined in the market opening baseline.



Dependencies:     The completion of the pre-market processing task is dependent on the following:
                  • The implementation of the required systems by the participants (see task 2.4
                      Cutover to new systems by market participants).
                  • The readiness of the EBT hub providers to support the transfer of EBTs
                      between participants.
                  • The completion of all service agreements between participants participating in
                      the pre-market processing task (see task 4.1 Distributor – Retailer Service
                      Agreements).
                  • The agreement of prudential amounts between participants participating in the
                      pre-market processing task (see task 4.2 Retail Prudential Posting).
                  • Outputs of the multiple contract resolution task (see task 3.2 Multiple Contract
                      Resolution).


Outputs:          Activity Milestone:
                  • Historical usage and payment history requests for all consumers to be
                      completed by March 22, 2002. This activity and milestone is mandated in
                      Section 14 of the Retail Settlement Code.

                  Activity Completion:
                  • Approved enrolments are pre-processed by the market participants for the May
                      1, 2002 market opening.


Comments:         Only enrolments that were subject to and approved by the multiple contract
                  resolution task will be pre-processed prior to market opening.




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Appendix B: Retail Market Opening Plan



4 Inter-Organization Arrangements

4.1 Distributor-Retailer Service Agreement
Activity          Distributors are required to sign the standard Service Agreement (Appendix C to
Description:      the Retail Settlement Code) with all retailers that have indicated they intend to be
                  active in the distributor’s service area. Those agreements define the business
                  relationship between both parties. The requirement to enter into the Service
                  Agreement is set out in chapter 12 of the Retail Settlement Code.


Outputs:          Activity Completion:
                  • Participants must have completed Service Agreements by February 15, 2002.




4.2 Retail Prudential Posting
Activity          Distributors are responsible for having necessary prudential arrangements in place
Description:      with all retailers active in their service area. Retailer prudential arrangements must
                  comply with the requirements set out in chapter 8 of the Retail Settlement Code.


Dependencies:     To provide the spot price information required for the calculation of the prudential
                  amount the distributors and retailers will require the IMO’s prudential support
                  obligations reference price. A revised Appendix B to the Service Agreement is to
                  be posted by the OEB by February 28, 2002.

Outputs:          Activity Milestones:
                  • Distributors and retailers must agree prudential prior to start of pre-enrolment
                      processing, March 22, 2002.

                  Activity Completion:
                  • Retailers must post necessary prudential requirements by April 8, 2002.




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Appendix B: Retail Market Opening Plan



5 Retail Participant Testing
5.1 Inter-Participant Testing
Activity          Subsequent to the end-to-end testing conducted as a requirement for the self-
Description:      certification filing, additional end-to-end testing is recommended. In particular, the
                  test should be conducted with live participation of both a distributor and retailer.


Comments:         The completion of this activity is not mandated for any market participants.
                  However it is strongly recommended that inter-participant tests be conducted by the
                  market participants who intend to interact following the opening of the market.

                  Assistance in conducting these tasks can be found in the Scenario Test Pack. An
                  update version of this document will be available shortly.




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Appendix B: Retail Market Opening Plan



6 Contingency Arrangements
6.1 Implement Contingency Arrangements
Activity          All distributors who will not be capable of billing using the approved market
Description:      opening rate orders as of May 1, 2002 should prepare to operate under contingency
                  arrangements.


Dependencies:     The completion of this tasks is dependent on the following:
                  • The loading of the contingency rate into the billing systems (see task 2.3
                      Loading of new rates into systems).


Outputs:          Activity Milestone:
                  • Following receipt of requests from distributors (see M5 below), OEB provides
                      contingency rates , April 1, 2002.

                  Activity Completion:
                  • Implementation of all requirements for the contingency arrangement including
                      the implementation of contingency rates, May 1, 2002.


Reporting         M5 – Distributors that will not be able to complete their preparations in time for
Milestones:       market opening should apply for contingent rates on or before March 14, 2002 to be
                  assured that they will the rates by April 1, 2002.




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Appendix B: Retail Market Opening Plan



7 Market Opening and Initial Operation
7.1 Stability Period
Activity          A stability period commencing two weeks in advance of market opening and
Description:      lasting until two weeks after market opening will be put in place. During this
                  period, retailers should not submit any new enrolments.


Outputs:          Activity Completion:
                  • Stability period closes on May 15, 2002.


Comments:         Chapter 14 of the Retail Settlement Code sets out the stability period.




7.2 Market Opens
Outputs:          Activity Completion:
                  • Market opens on May 1, 2002.




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