By Amanda Durish Cook
FERC last week granted MISO a one-time Tariff waiver allowing the RTO to designate certain Louisiana resources as commercially significant to voltage and local reliability (VLR) without first collecting and studying a year of data to back up the determination (ER18-2273).
MISO plans to allocate the majority of VLR commitment costs incurred in the Fancy Point load area on the Mississippi River to Entergy, which has the largest amount of load and stands to benefit most. Entergy said it did not oppose the waiver, which is effective for one year beginning Aug. 22, 2018.
The RTO’s Tariff requires it to conduct quarterly VLR issue studies using data from the previous 12 months before it can label VLR commitments “commercially significant.”
FERC said the waiver is “narrowly tailored” to allow MISO to make the designation while accumulating the 12 months of data necessary to conduct a study pursuant to its Tariff. It added that the move is “consistent with the principle of cost causation in that it is designed to allocate revenue sufficiency guarantee make-whole payments for VLR commitments to the load in the local balancing areas that benefit from the VLR commitments.”
MISO said that absent a waiver, it would be required to allocate VLR commitment costs to the local balancing area where the VLR-committed resource is located, instead of allocating costs on a load-share basis to the entities that benefit from commitments.
FERC found that MISO acted in good faith on the designation by working with affected parties to create an operating guide and convening a special meeting to discuss VLR issues.