Market Structure

Restructuring of the electricity market in the District effectively separated the generation or supply component of your electricity from transmission and distribution. The unbundling allows customers like you to either accept Standard Offer Service (SOS) from your old monopoly utility or choose your retail electricity supply company, based on competitive products, prices and services that best fit your needs.

Since February 2005 PEPCO, the Provider of Last Resort, has procured SOS supply through a periodic wholesale power solicitation with three-year laddered contracts for residential and small commercial customers and two-year contracts for larger C&I customers. SOS rates are based on the weighted average of the winning bid prices for the relevant customer group plus FERC-approved transmission costs, administrative charges to recover PEPCO's incremental costs for providing SOS service, and retail adders. PEPCO also offers a market passthrough rate called the Market Price Service (Rider "MPS").

When you choose Liberty Power as your competitive retailer, we become the seller of your electricity supply. However, your electricity is still delivered by your PEPCO, which remains responsible for ensuring reliable transmission and delivery to your business. In addition, PEPCO still issues your bill, but with your electricity supply charges from Liberty Power listed separately. That way you can see exactly what you are paying for your electricity supply.

The Washington, DC electricity market is under the jurisdiction of the PJM Interconnection, the regional transmission organization (RTO) that coordinates the movement of wholesale electricity in all or parts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and the District of Columbia. Acting neutrally and independently, PJM operates the world's largest competitive wholesale electricity market and ensures the reliability of the largest centrally dispatched grid in the world. The company coordinates the continuous buying, selling and delivery of wholesale electricity through robust, open and competitive markets. In operating the markets, PJM balances the needs of suppliers, wholesale customers and other market participants and continuously monitors market behavior.