(a) Rates for customers within DP&L’s service territory.

(1) DP&L is required to offer both standard offer service and returning customer service, except that returning customer service shall only apply to customers meeting the definitional load characteristics for such service. Customers on returning customer service may return to standard offer service after receiving returning customer service for a minimum of 12 consecutive months.

(2) After May 1, 2006, rates for customers taking standard offer service shall be adjusted in accordance with subchapter III of Chapter 1 of this title. The Electric Utility Retail Customer Supply Act of 2006, 75 Del. Laws, c. 242, shall not have any effect on contractual arrangements between the standard offer service supplier and successful bidders entered into as a result of the recently conducted bidding process for standard offer service in Public Service Commission Docket No. 04-391. Any rates derived from that process shall be determined by the Commission pursuant to that docket, except as permitted in paragraph (a)(3) of this section.

(3) With respect to rate increases for standard offer service to be effective on May 1, 2006, residential and small commercial customers of DP&L, depending on rate classification, shall have the ability to opt out of the following rate deferral plan:

The limitations on rate increases specified in this section shall be accomplished by applying appropriate credits/charges per kilowatt hour to customer bills. The same credits/charges per kilowatt hour shall be applied regardless of whether the customer is receiving standard offer service or purchasing electricity from an electric supplier.

a. A customer not opting out of the deferral plan will be placed on a nonbypassable tariff, under which the customer will be responsible for all of that customer’s incurred deferral amounts including carrying costs of the plan.

b. Customers will have from April 1, 2006, to April 28, 2006, to affirmatively opt out of this plan.

c. Upon completion of the deferral plan, customers on the plan will be returned to their original rate classification, subject to any past due amounts owed while on the plan. The “True-up/Balance” to be instituted on January 1, 2008, shall provide for equal monthly installment amounts designed to recover all deferral amounts by each customer by not later than June 1, 2009, as well as the full standard offer service charges and all other tariff charges then in effect.

d. Except as otherwise provided for in the Electric Utility Retail Customer Supply Act of 2006, 75 Del. Laws, c. 242, customers enrolled in the deferral plan will be able to purchase electricity from an electric supplier and will continue to receive the same credits/charges specified in this section.

e. If determined to be in the public interest, the Commission shall have the authority after January 1, 2007, to adjust the deferral plan to take advantage of any downward movement of standard offer service rates.

(4) Rates for customers on returning customer service shall be based on the regional spot market plus DP&L’s reasonable costs of procuring such supply for this group of customers.

(5) In addition to the standard offer service price or the alternative electric supplier’s supply price, each customer shall pay the separate applicable rates for transmission, ancillary, distribution, nuclear decommissioning and other services. Such rates shall not include any generation or electric supply costs.

(6) Customers who obtain transmission and/or ancillary services directly from the PJM independent system operator or from their electric supplier shall receive a credit against DP&L’s retail delivery rates equal to the then-applicable Federal Energy Regulatory Commission equivalent retail transmission and/or ancillary services rates paid by that customer or its electric supplier.

(b) Rates for customers within the DEC service territory.

(1) DEC is required to offer both standard offer service and returning customer service, except that returning customer service shall only apply to customers meeting the definitional load characteristics for such service.

(2) After May 1, 2006, rates for customers taking standard offer service shall be adjusted in accordance with subchapter III of Chapter 1 of this title.

(3) Rates for customers on returning customer service shall be based on the regional spot market plus DEC’s reasonable costs of procuring such supply for this group of customers.

(4) In addition to the standard offer service price or the alternative electric supplier’s supply price, each customer shall pay the separate applicable rates for transmission, ancillary, distribution, nuclear decommissioning and other services. Such rates shall not include any generation or electric supply costs.

(5) Customers who obtain transmission and/or ancillary services directly from the PJM independent system operator or from their electric supplier shall receive a credit against DEC’s retail delivery rates equal to the then-applicable Federal Energy Regulatory Commission equivalent retail transmission and/or ancillary services rates paid by that customer or its electric supplier.

72 Del. Laws, c. 10, § 3; 70 Del. Laws, c. 186, § 1; 75 Del. Laws, c. 242, § 5.