By Rory D. Sweeney
Preparing for next year’s termination of the Con Ed-PSEG “wheel,” PJM is using a three-pronged approach to coordinate stakeholder efforts through its Operating, Markets Implementation and Planning committees.
Each committee received updates last week on Consolidated Edison’s decision not to renew the agreement, under which NYISO moves 1,000 MW from upstate generators through Public Service Electric and Gas facilities in northern New Jersey to serve Con Ed load in New York City.
Con Ed said it would not renew the agreement, which began in the 1970s, after receiving a $680 million bill for two transmission upgrades in PSE&G territory — cost allocations that Con Ed complained were unreasonable. (See Con Ed-PSEG ‘Wheel’ Ending Next Spring.)
PJM assigned Con Ed $629 million of the costs of PSE&G’s $1.2 billion Bergen-Linden Corridor upgrade to address a short-circuit problem; PSE&G was allocated $52 million. Con Ed was also assigned $51 million of PSE&G’s $100 million Sewaren storm-hardening project.
The transmission contract for the wheel expires May 1. Con Ed informed the grid operators that it found cheaper alternatives.
PJM and NYISO are collaborating on a replacement protocol that maintains reliability and is mutually beneficial to both grid operators. The protocol will adhere to FERC’s open access rules and support any existing market-to-market exchanges, PJM said. It will utilize existing infrastructure and won’t address merchant facilities, they said.
The Impact of PARs
Several stakeholders expressed concern that PJM’s goal of “free-flowing ties” would be hampered by the eight phase angle regulators (PARs) that currently govern the direction of flows on lines connecting the RTO with NYISO. There are one each on the A, B and C lines that flow 1,000 MW from PSE&G into New York, three just south of Waldwick on the J and K lines that flow the 1,000 MW into PSEG from upstate and two on the Branchburg-Ramapo 5018 line.
One of PARs on the 5018 line owned by Con Ed failed in June, and it was unclear whether NYISO and Con Ed plan to replace it. Participants asked if the PARs could be removed. “I worry about PJM calling balls and strikes on market optimization,” said Ed Tatum, vice president of transmission for American Municipal Power.
Several participants questioned why the PARs must be kept at all. Speaking after the meeting, Mike Bryson, PJM’s vice president of operations, explained that NYISO has always had a philosophy of using control devices to manage congestion and loop flow.
‘Insider Information’
Other participants expressed concern that the discussions between PJM, NYISO, PSEG and Con Ed haven’t been transparent. Dave Pratzon of GT Power Group, which represents some generators, asked for confirmation that the discussions haven’t included any “insider information.”
Bryson said PJM has ensured that conversations never overstepped the rules. “When we approach that line, we back the parties away,” he said.
Wheel’s New Look
PJM officials said further detail wouldn’t be available until August’s MIC meeting because of the timeline required to approve changes to the PJM-NYISO joint operating agreement. A broader picture wouldn’t be available until September.
Tim Horger, manager of market simulation at PJM, said the New York interface will likely be changed to model what’s “actually going to happen in real time.”
Both NYISO and PJM ran independent studies to determine interchange flows unconstrained by PARs — what they called “natural flow.” The studies were based on a summer peak case and found that 32% would flow over the western ties that connect between the “Twin Tiers” of Pennsylvania and New York, while 68% would interchange between the eastern ties involved with the wheel.
PJM engineer Asanga Perera said that part of the wheel’s benefit today is that the 1,000 MW coming into New York City from New Jersey pushes back on bottlenecks north of the city so it doesn’t see additional congestion.
Cost Allocation
With Con Ed out of the picture, the $680 million in upgrade costs will be reallocated to the existing stakeholders based on guidance in PJM’s manuals, officials said.
In response to a request from Tatum, PJM Vice President of Planning Steve Herling said he would look into providing a document answering frequently asked questions about the change and any public documents that governed the decision-making process.
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Ranger Solar is conducting an environmental assessment for a solar farm of up to 80 MW that could break ground in 2018.
The state has hired two companies to analyze the financial impact of a hypothetical rupture of Enbridge’s underwater pipelines, collectively called Line 5, in the Straits of Mackinac and to explore potential alternatives to their route. Enbridge will pay $3.5 million for the studies but declined to oversee the work.
The Utilities Commission says two nonprofits must put up a $98 million bond to go forward with an appeal of a permit given for a new Duke Energy gas-fired power plant. The commission originally set the bond at $10 million, but an appellate court told it to recalculate the bond based on “competent evidence.”
Two administrative law judges are recommending that the Public Utility Commission fine Blue Pilot Energy $5 million for charging its variable-rate customers high prices during the polar vortex of 2014.
The Commission on Environmental Quality renewed and expanded a wastewater permit for Dos Republicas Coal Partnership, allowing the company to expand its current operations near the Mexican border and mine up to 6,300 acres for low-quality coal.
Adam Bell, SPP’s interregional coordinator, told the committee July 8 that the two RTOs have not nailed down the scope, but that it may not be limited to the Dakotas’ seam with the Western Area Power Administration, as MISO would prefer. The two grid operators agreed May 31 to take a “targeted” look at the newly created seam. (See “SPP, MISO Agree to Conduct ‘Targeted’ Joint Tx Study,” 
