By Amanda Durish Cook
LS Power filed a complaint Wednesday asking FERC to compel MISO to lower the threshold for competitively bid transmission projects from 345 kV to 100 kV and change its approach to estimating the benefits of smaller projects.
The complaint under Federal Power Act Section 206 requests the commission to order reforms on a 60-day deadline that establish cost allocation for market efficiency projects (MEPs) below 345 kV (EL19-79).
Currently, MEPs must meet a voltage threshold of at least 345 kV and cost at least $5 million. However, MISO earlier this year filed a Tariff revision to lower the threshold to 230 kV, a change that RTO staff have said will reflect the reality of a footprint where 230-kV lines are prevalent. (See MISO MEP Cost Allocation Plan Goes to FERC.)
FERC has yet to rule on the requested change, and LS Power has also filed its complaint in the docket for the associated proceeding (ER19-1124).
In its complaint, LS Power argues that reducing the voltage threshold to 100 kV would “remedy flaws in MISO’s economic planning process” and also expand the number of projects eligible for competition, consistent with FERC Order 1000.
“The commission should require MISO to resolve this issue quickly as it has been aware of this deficiency in its economic planning process for several years and failed to solve it in a just and reasonable manner,” LS Power said.
The company contends that MISO’s planning process fails to provide a “clear path” for regionally beneficial economic projects at lower voltages, resulting in “unnecessary congestion costs and unjust and unreasonable rates.”
Not Far Enough
MISO’s filing does seek to address at least some of LS Power’s concerns by creating a new category for economic projects below 230 kV and above 100 kV for which 100% of costs would be allocated to a local transmission pricing zone, rather than across multiple zones. Such transmission projects were previously categorized as “other” projects without clear allocation rules.
But the company said the RTO’s cost allocation proposal doesn’t go far enough and argued that economic projects below 345 kV can relieve congestion in multiple transmission pricing zones.
“There are not clear criteria or procedures for identifying and evaluating economic projects outside of the Market Efficiency category to determine whether they provide regional benefits and thus should be selected in MISO’s regional transmission plan. As a result, economically beneficial projects may not be identified or may otherwise stall during the planning process to the detriment of ratepayers,” LS Power said.
The company’s complaint goes a step beyond the cost allocation issue, asking FERC to find MISO’s current MEP planning process unjust and unreasonable because it doesn’t outline a path for planning regionally beneficial economic projects that don’t meet MEP criteria. The company also pointed to a substantial amount of 100- to 200-kV facilities in the MISO footprint, saying it’s likely the RTO has overlooked similar smaller projects that would reduce congestion across the footprint.
LS Power also charged that the MEP voltage threshold undermines Order 1000 because such a strict voltage criteria “effectively grants incumbent transmission owners in MISO a federal right of first refusal to build regionally economic enhancements that do not meet the market efficiency project thresholds.”
“It is time for the commission to send a clear message that it will not allow such end runs around Order No. 1000,” LS Power said. While it is difficult to gauge the financial harms related to MISO’s 345-kV voltage requirement for MEPs, the company said it is making a “good faith effort” to estimate the number of projects it may have lost out on.
The company also said it has already raised its MEP-related concerns with both MISO staff and in the RTO’s Regional Expansion Criteria and Benefits Working Group, where cost allocation decisions are made.
LS Power’s Republic Transmission is currently in the process of building the Duff-Coleman 345-kV transmission project in Southern Indiana and Western Kentucky, the RTO’s first competitive transmission project. (See LS Power Unit Wins MISO’s First Competitive Project.) MISO’s second-ever competitively bid transmission project is now in doubt over a recently passed right of first refusal law in Texas. (See related story, Texas ROFR Law Clouds Hartburg-Sabine Future.)