PJM Planning Committee Briefs

Load representatives said Thursday they will oppose PJM’s proposal to increase the installed reserve margin (IRM) to 16.6%, from 15.7%.

“There’s going to be a lot of push back on this,” said James Wilson, a consultant to state consumer advocates, who criticized what he called PJM’s “arbitrary” choice of a load model. “There’s quite a lot of load models that would fit equally well” but result in lower reserve margins, Wilson said.

Ed Tatum said the proposal prompted a “fairly violent” reaction among his colleagues at Old Dominion Electric Cooperative and threatens to renew the “IRM wars” of previous years.

Tatum said the increase in the IRM was “counterintuitive” given the higher performance expectations of PJM’s new Capacity Performance product. As a result, he said, load representatives will challenge the “overly conservative” assumptions PJM used in calculating the figure.

PJM’s Patricio Rocha-Garrido said the increase resulted from changes in 2015 capacity and load models as well as a decline in the capacity benefit of ties (CBOT) — expected capacity imports.

Rocha-Garrido noted that seemingly large increases in IRM may not have that much impact on the forecast pool requirement (FPR), which determines the amount of capacity procured in the annual Base Residual Auction.

The reliability requirement is calculated based on the 50/50 peak load forecast for the delivery year multiplied by the FPR. The FPR is increasing from 1.0847 to 1.0881 (from 8.47% to 8.81% above the peak load forecast.)

The increase is a result of a new load model (2003-2012) that better represents the coincident peak distribution in the 2015 load forecast, Rocha-Garrido said.

The CBOT was reduced because the “rest of world” peak demand is becoming more coincident with the PJM peak, he said.

PJM will seek members’ endorsement of IRM and associated parameters for delivery years 2016 through 2019 beginning in October, with final approval by the PJM board expected in December or January.

New Methodology Could Lower Summer 2018 Forecast by 2.6%; Winter down 1.8%

PJM could lower its 2018 summer peak load forecast by 2.6% as a result of new forecasting methodology that incorporates more recent economic data, a shorter weather simulation and the energy efficiency of air conditioners and electric appliances.

The new methodology also would reduce the winter 2018 forecast by 1.8% over the current official projection.

The forecast outlined to the PC last week will be finalized after an additional update to economic data, equipment index trends and any additional equipment “saturation” data by zones.

Manual language documenting the new methodology still needs to be developed and presented to the PC and MRC.

PJM said the new methodology will reduce the error rate for forecasts three years into the future to 1.5%, compared with the current method’s 6.6%.

One significant change is the RTO’s effort to improve its weather forecasts to reflect a trend of higher peak temperatures.

The RTO has based its forecasts on temperature and humidity data from 26 weather stations dating back to 1973. But a new analysis revealed that peak readings for 1993-2013 were higher than those for 1973-1993.

As a result, PJM’s Andrew Gledhill said, the RTO plans to exclude the earlier data and rely on that from 1994/95. It will reevaluate the historical base about every five years. (See “Climate Change Impact? Higher Highs has PJM Adjusting Weather Forecasts,” in PJM Planning Committee Briefs.)

ODEC’s Tatum said PJM’s plan to reevaluate the time sample for the weather forecasts could inject subjectivity into the modeling, creating a temptation to make changes “to get the answer you want.”

But PJM’s Tom Falin said the weather analysis will be done independently and not evaluated based on its impact on the forecast load.

At the Oct. 1 Markets and Reliability Committee meeting, PJM officials will discuss how they plan to incorporate the new methodology into its capacity auctions. Stu Bresler, senior vice president of markets, said adjustments will have to be made to ensure the RTO is not double counting energy efficiency, which can offer into the auction as a capacity resource.

Action Delayed on Voltage Threshold for Competitive Projects

PJM delayed a vote on a plan to exclude transmission reliability projects below 200 kV from competition, saying it wants to refine the proposal in response to stakeholder comments.

PJM said reliability projects below 200 kV are almost always allocated to one zone and thus automatically assigned to the incumbent transmission owner. The “voltage floor” would allow the RTO to eliminate the cost of evaluating competitive proposals in cases where the likely solution is a transmission owner upgrade. It would not apply to market efficiency projects.

Competitive developers expressed reservations about the proposal at the August PC meeting. (See “Developers Wary of ‘Voltage Floor’ on Competitive Projects” in PJM Planning Committee Briefs.)

At last week’s PC, PJM distributed an expanded chart for how the RTO would handle projects between 100 kV and 200 kV and those above 200 kV or below 100 kV. PJM’s Sue Glatz said the chart “narrows the scope of discretion” for PJM in determining whether or not to open a project to competition.

ITC Holdings’ John Kopinski said the chart made his company more comfortable with the proposal, which he said was consistent with the FERC-approved process for deciding which projects are competitive and which are reserved for incumbents. “You’re not really changing what’s competitive and what’s not,” he said.

Paul McGlynn, general manager of system planning, said PJM will modify the chart and proposed Operating Agreement language to reflect stakeholder comments from the meeting. PJM would like to implement the change in time for the 2016 Regional Transmission Expansion Plan.

Winter Peak Reliability Study

PJM planners last week outlined new rules for separately modeling winter reliability as part of the RTEP.

The changes to Manual 14B: PJM Region Transmission Planning Process would require planners to conduct a reliability analysis to ensure that the grid can deliver enough generation to meet the 50/50 winter peak. It will model generators by fuel class based on historical operation during winter peak loads.

In the past, PJM has planned for reliability based only on its summer peak load.

The changes will be brought to an endorsement vote at the PC next month, with plans to incorporate the study in the 2016 RTEP.

At the Transmission Expansion Advisory Committee meeting later Thursday, planners presented the results of their first study under the new rules, which defines winter as December through February. (See pp.11-24 of the presentation.)

The analysis looked at thermal and voltage violations both with and without consideration of gas contingencies. The North American Electric Reliability Corp.’s transmission planning standard (TPL-001-4), which takes effect Jan. 1, requires PJM to consider extreme system events such as the loss of a large gas pipeline serving significant generation.

PJM analyzed 30 gas pipeline and compressor failure contingencies that could result in the loss of 1,000 MW or more of generation.

Two contingencies, for pipeline outages in EMAAC, suggested the potential loss of 10,000 MW of generation, although officials said the generation would not go offline immediately because of the ability to burn “line pack” gas.

McGlynn said the results of the winter study did not suggest “the sky is falling” but reinforced the need for criteria to capture problems not seen in the light load or summer analyses.

Manual Language on Multi-Driver Projects OK’d

Members approved manual changes documenting how PJM will oversee transmission projects that have multiple benefits. The new rules on multi-driver projects are documented in manuals 14B and 14A: Generation and Transmission Interconnection Process.

Multi-driver projects have benefits in at least two categories, including baseline reliability upgrades, market efficiency and public policy.

States seeking to meet public policy objectives could sign on to projects after they have been approved. But once rights of way or equipment such as transmission towers have been acquired, states would be liable for costs “even if they didn’t go forward with the solar farm or wind farm,” said PJM’s Fran Barrett.

Long-Term Firm Transmission Service Study

The PC approved the charter for a group considering changes to the way PJM conducts studies for long-term firm transmission service.

The group, which resulted from a problem statement approved in April, has met twice, with a third meeting set for Sept. 24.

It will determine if changes are needed to:

Modeling practices for long-term firm transmission service requests (TSRs) in RTEP power flow cases;
Study methods used in RTEP and new service queue studies; and
Cost allocation requirements associated with long term TSRs.

PAR Transmission and Withdrawal Rights

Planners gave stakeholders the first read on rules governing how phase angle regulators (PARs) that redirect energy flows can qualify as controllable AC merchant transmission facilities.

The proposal resulted from a problem statement proposed last November by PSEG Energy Resources & Trade.

PJM currently awards withdrawal and injection rights to controllable AC and DC merchant transmission facilities using only variable frequency transformer (VFT) technology, which excludes PARs. (See “PSEG Seeks Injection Rights for PARs” in PJM Planning Committee Briefs.)

The task force appointed to review the issue endorsed a PJM staff recommendation after staff determined through flow control analyses that PARs “did not show any significant deviation from other controllable AC or DC type installations.”

The task force said that PARs did not harm holders of existing injection and withdrawal rights “assuming reinforcements identified for PAR installations were made.”

PAR owners will be required to comply with rules governing allowable deviations for all resources that are self-scheduled. The operators must be able to control their flows automatically, with the ability to manually adjust.

PJM will allocate costs for PAR facilities consistent with the methodologies used for HVDC and VFTs.

The new rules will be added to Manual 14E: Merchant Transmission Specific Requirements; no Tariff change is required.

— Rich Heidorn Jr.

September 15, 2015

PJM Transition Auction Capacity not Included in Incremental Auction

None of the 10,017 MW of additional capacity committed in the 2017/18 transition auction will be calculated in this week’s incremental auction for the delivery year, PJM said.

“Originally, we said yes, the new commitments — the incrementally additional committed megawatts — would be rolled into capacity,” Stu Bresler, PJM senior vice president for markets, told the Market Implementation Committee. However, he said, “The Tariff will not allow us to do that. It’s very specific in the calculation of how many megawatts we procure or release.”

But, he said, PJM believes that incorporating new capacity into the incremental auctions is “the right thing to do” and will be introducing a Tariff change at the Oct. 1 meeting of the Markets and Reliability Committee.

If a load forecast changes between a Base Residual Auction and the corresponding delivery year’s incremental auction, PJM adjusts its reliability requirements, Bresler said.

“Conceptually, if the reliability requirement goes up, PJM could buy more capacity. If it goes down, which has been the trend, the requirement drops, and PJM could sell off previously committed capacity in the incremental auction,” he said. “Participants could buy that as replacement.”

Bresler said that if the Tariff change is approved, PJM expects to include additionally committed capacity in the third incremental auction for the 2016/17 year, to be held in February. The transition auction for that year procured 4,246 MW of additional capacity.

— Suzanne Herel

September 15, 2015

Ginna Agreement Reached; to be Filed by Sept. 23

The operator of the R.E. Ginna nuclear plant in western New York has reached an agreement to keep the financially stressed generator operating.

Administrative law judges for the New York Public Service Commission said Wednesday that a joint proposal for the PSC-ordered reliability support services agreement between Constellation Energy Nuclear Group and Rochester Gas & Electric is expected to be filed by Sept. 23.

The judges posted a revised schedule calling for comments on the agreement by Sept. 30, with an evidentiary hearing to be held on Oct. 14 (14-E-0270).

Parties to the agreement in principle include the PSC staff, the New York Division of Consumer Protection and a group of interveners representing commercial and industrial customers.

Entergy Nuclear, which has plants in western New York and the Hudson Valley, and NRG Energy have opposed the RSSA throughout the 14-month proceeding. The companies will neither support nor oppose the agreement, the filing said.

Environmental groups Alliance for a Green Economy and Citizens’ Environmental Coalition will oppose the agreement in part, but the objectionable sections were not identified.

The out-of-market contract is expected to raise rates for customers in the Rochester area. The PSC recently adopted a temporary rate surcharge to lessen rate shock when a final agreement is sent to the commission. (See NYPSC Approves 5.2% Ginna Rate Surcharge.)

— William Opalka

September 15, 2015

SPP Committee and Stakeholder Briefs

SPP is preparing for the Environmental Protection Agency’s Clean Power Plan by beginning outreach to state officials and planning to form a task force under its Strategic Planning Committee.

The RTO scheduled a two-hour webinar to kick off the effort on Friday, Sept. 18. Lanny Nickell, SPP’s engineering vice president and point man for CPP compliance, told the SPC during its August meeting that all 14 states in the RTO’s footprint have been invited.

While there have been no requests for SPP to develop a plan or trading rules, the RTO says a regional approach would be easier to implement.

The SPC tabled a motion to form a CPP task force and instead asked staff to work with Golden Spread Electric Cooperative’s Mike Wise, the committee chair, to draft a scope document to better understand and pursue the regional-trading issue.

Nickell said SPP will include modeling futures based on the final EPA rule in its 2017 Integrated Transmission Plan’s 10-Year Assessment to determine how it impacts the RTO’s transmission needs.

SPP’s regulatory staff is currently meeting with key state legislators, according to an update given to another task force responsible for gas-electric timeline coordination.

SPP-MISO Settlement to be Filed Oct. 9

David Kelley, SPP’s director of interregional relations, told the RTO’s Seams Steering Committee last week that SPP and MISO plan to file a settlement agreement with FERC on Oct. 9 that could bring an end to their dispute over the latter’s use of a 1,000-MW contract path between its North and South regions.

“There’s not a lot I can share publicly,” Kelley said, “but I can discuss the schedule.”

The proposed settlement also was discussed by MISO members at meetings last month. (See “Settlement with SPP over 1,000-MW Limit Will Eliminate ‘Hurdle Rate’” in Markets Committee Briefs.)

SPP RE Reliability Assessment Webinar

SPP and the SPP Regional Entity have scheduled a 30-minute webinar on the 2015 winter reliability assessment for Sept. 23. SPP RE staff will present an overview of the draft assessment and solicit feedback before it is finalized with the North American Electric Reliability Corp.

Registrants will receive the draft assessment and presentation for review.

— Tom Kleckner

September 15, 2015

Generation, Northern Pass, Net Metering on the Menu at NECA Legislative Update

By William Opalka

CAMBRIDGE, Mass. — Speakers at the Northeast Energy and Commerce Association’s dinner meeting last week discussed pending legislation in Maine, the future of the proposed Northern Pass Transmission project and net metering.

Daniel Allegretti, a vice president of state government affairs for Exelon, spoke about the prospects for Northern Pass. Developers have proposed burying nearly one-third of the line to import Canadian hydropower, but critics, including New Hampshire Gov. Maggie Hassan, had been seeking to put even more of the 190-mile line underground. (See Northern Pass Opponents Want More of Line Buried.)

The state’s Site Evaluation Committee has a 10-step process for approving such projects. “The governor has been clear that she is waiting for the site evaluation process to play out,” Allegretti said.

Christopher Sherman, president of New Hampshire transmission for NextEra Energy, said one of the investor-owned utilities in Massachusetts earlier this year reached the 4% limit on the integration of net-metered generation onto the grid.

“The governor’s own bill [which would raise the cap to 6%, with future increases left to state regulators] will be considered at a hearing by the end of this month, with the possibility the legislature will pass a bill later in the fall,” Sherman said.

Sandi Hennequin, vice president of U.S. public affairs for Nova Scotia-based Emera Energy, mentioned a bill backed by Maine Gov. Paul LePage that would allow local distribution utilities, which were divested after restructuring in 2000, to own some generation assets.

The bill would require the Public Utilities Commission to determine “that ownership is beneficial to the utility’s ratepayers” and to “impose terms, conditions or requirements the commission determines are necessary to protect the interests of the utility’s ratepayers.” The bill was introduced last session and has been held over for consideration during the coming session.

Patrick C. Woodcock, director of the governor’s energy office, said LePage saw the need for the legislation because of ambiguity about whether affiliates of local utilities can own generation. Woodcock said neither the state’s restructuring law nor a recent court ruling provided clarity. The case involved a proposed $333 million joint venture by Emera and First Wind to finance wind farms in the state.

“The governor asked, ‘Does it really make sense to have this iron-clad prohibition?’” Woodcock said in an interview after the dinner. He said limited utility ownership of generation could help the state modernize older hydro facilities.

“I think there’s an opportunity there for some of the utilities to benefit from generating from solar,” said Maine Rep. Larry C. Dunphy, who introduced the bill on the governor’s behalf. “There’s a number of motivations.”

September 15, 2015

Bay Replaces FERC General Counsel

FERC Chairman Norman Bay named a long-time associate from New Mexico as FERC general counsel, replacing David Morenoff.

Max Minzer, who served as Bay’s special counsel in 2009-10 when the latter headed FERC’s Office of Enforcement, joined the chairman’s staff as an advisor in June.

Minzer’s appointment means Morenoff, appointed general counsel by former Chairman Cheryl LaFleur last September, will return to his former post as deputy general counsel. (See LaFleur Puts Stamp on FERC with Appointments.)

Minzer met Bay while working as a law clerk at the U.S. Attorney’s Office in New Mexico almost 20 years ago. Bay was U.S. Attorney for New Mexico in 2000-01 after serving as an Assistant U.S. Attorney in D.C. and New Mexico from 1989 to 2000.

Like Bay, Minzer is a former professor at the University of New Mexico School of Law, where he won the university’s 2013-2015 Presidential Teaching Fellowship, an award recognizing teaching excellence. He previously taught at the Benjamin N. Cardozo School of Law in New York. A graduate of Brown University and Yale Law School, Minzer has been published in the Harvard Law Review, the Texas Law Review and the William & Mary Law Review.

Bay praised Morenoff even as he moved him aside. “It is a testament to the high regard in which David is held that he is one of the few general counsels who has served three different chairmen as either the acting general counsel or as general counsel,” Bay said in a statement.

Morenoff, who joined FERC from Troutman Sanders, formerly served as a legislative aide to U.S. Sen. Jack Reed (D-R.I.). He is a graduate of Brown University and Harvard Law School. In addition to his work in the general counsel’s office, he also served as senior legal and policy advisor to former Chairman Jon Wellinghoff.

— Rich Heidorn Jr.

September 15, 2015

FERC Overrides ISO-NE, Grants Waiver for Late Capacity Payment

By William Opalka

FERC granted a waiver to a New England power generator that missed the deadline for a payment to increase the plant’s offer for the next Forward Capacity Auction.

The commission majority said Northeast Energy Associates had made a “good faith” effort to comply with ISO-NE rules once it discovered an administrative oversight (ER15-1934).

NEA sought a 25-MW increase in the capacity of its Bellingham Energy Center in Massachusetts but failed to make a $50,000 interconnection deposit for FCA 10 by the March 3, 2015, deadline.

It discovered the error that day but was unable to make a bank transfer before the Federal Reserve’s 5:30 p.m. deadline. The funds were transferred the following morning.

“We find that NEA acted in good faith by submitting its interconnection deposit as soon as possible after it discovered the omission … [and] the request for waiver is limited in scope, because it allows a one-time, finite waiver of a procedural deadline under the narrow circumstances of this case,” the majority said.

FERC said the company filed an otherwise valid request to increase its capacity and the delay in submitting its interconnection deposit would not affect the qualification process for FCA 10.

ISO-NE had opposed the request for relief, saying that it would be unfair to other project sponsors who submitted invalid interconnection requests and did not seek a waiver. The RTO also said NEA had not shown the resource would be needed in the newly proposed Southeastern New England capacity zone that will be created in the reconfigured zones in the 2018-2019 capacity commitment period.

Commissioner Philip Moeller agreed with the RTO, saying granting the waiver violates FERC precedent and will create future headaches.

“Such requests will present the commission with an enormous challenge to ensure that all market participants are treated similarly after missing [a Forward Capacity Market] or other deadline,” he wrote.

September 15, 2015

GridLiance Makes First Acquisitions

By Tom Kleckner

GridLiance arrived on the RTO scene in March billed as the nation’s first competitive transmission company focused on collaborating with public power entities. It came with a pedigree of experienced transmission executives from ITC Holdings and the deep pockets of private equity giant The Blackstone Group.

Now, the company has made its first two acquisitions — 420 miles of 69-kV and 115-kV lines in Missouri and Oklahoma — and announced plans to bid on SPP’s first competitive transmission project.

Incorporated last year, the company unveiled its business plan in March with the announcement that it and its affiliates had entered into 30-year development agreements with the Missouri Joint Municipal Electric Utility Commission (MJMEUC) and the Oklahoma Municipal Power Authority (OMPA), giving them the exclusive right to jointly plan, construct and operate the agencies’ transmission infrastructure in SPP and MISO.

On Sept. 1, GridLiance announced a pair of acquisitions that will give it ownership of the transmission assets of Nixa, Mo., a member of MJMEUC, and of Tri-County Electric Cooperative in the Oklahoma panhandle. Both acquisitions are expected to be completed by year’s end.

ROE Request

On the same day as the announcement, GridLiance subsidiary South Central MCN filed a request with FERC seeking a return on equity of 11.4%, including a 50 basis points (bps) adder for RTO participation and a 100 bps adder as a standalone transmission company (ER15-2594). The company asked for approval of an initial capital structure of 60% equity and 40% long-term debt.

South Central said FERC should grant the incentives to the company, “given its unique business model, which will provide benefits to current and future customers of the wholesale electric grid, including its public power partners.”

The company said it intends to submit a bid to SPP to build the North Liberal-Walkemeyer 115-kV project and requested commission approval to collect construction work in progress if it wins the solicitation. (See SPP Issues RFP for 115-kV Transmission Project.)

South Central will be the operating company for GridLiance in SPP. In MISO, the company will operate under the Midcontinent MCN.

Investment Opportunities, Reliability Benefits

In announcing the acquisitions, GridLiance president and CEO Ed Rahill said the deals allow Nixa and Tri-County to shift their operations and regulatory risk to GridLiance while gaining access to investment opportunities and funding for previously unaffordable transmission projects, including access to — and delivery of — wind energy.

Participating systems will see reliability benefits, according to Rahill, because public power systems are often excluded from regional planning models, leaving many served by a single radial feed, vulnerable to outages if that connection is lost.

“Operating and maintaining transmission infrastructure is expensive without scale, often taking valuable resources away from other core municipal responsibilities,” Rahill said.

Experienced Team

Rahill is one of several transmission and public power veterans who comprise the leadership team of the company, which has offices in Chicago, Kansas City and Austin, Texas.

Rahill was part of the of the management team that acquired ITC Transmission from DTE Energy in 2003 and managed its initial public offering in 2005. As president of ITC Grid Development, he oversaw ITC Great Plains’ greenfield start-up and the development of $500 million in transmission in SPP.

Noman Williams, GridLiance’s senior vice president of engineering and operations, is former vice president of transmission policy and compliance for Sunflower Electric Power, which runs six rural electric distribution cooperatives in central and western Kansas. He has filled several key leadership roles within SPP, and currently serves as chair of the RTO’s most important member body, the Market and Operations Policy Committee.

Like Rahill, Senior Vice President of Business Development Carl Huslig comes from ITC, where he was president of ITC Great Plains. He has worked extensively with SPP and MISO stakeholder groups during his 20-plus years in the industry, leading an SPP task force that paved the way for independent transmission companies.

General Counsel Beth Emery held the same titles at CAISO and San Antonio’s CPS Energy, the nation’s largest municipal utility. (Emery was joined in the company’s Sept. 1 filing to FERC by former Commissioner William L. Massey, now with Covington and Burling.)

Blackstone

The company is being financed by Blackstone Energy Partners, which has invested more than $8 billion of equity globally across a broad range of energy industry sectors. Blackstone Senior Managing Director Sean Klimczak, who oversees the firm’s investments in the transmission and power sectors, said the company saw an opportunity to fill an underserved market for 40 million public power customers.

Public power has “been largely excluded from participating in the planning of and investment in new transmission infrastructure as well as the financial and service reliability benefits they provide to customers,” Rahill said at the announcement of GridLiance’s incorporation in March 2014.

GridLiance’s partnerships with public power allow it to compete with investor-owned utilities that are building most transmission in MISO and SPP, the company says. About 90% of transmission projects in MISO have been awarded to ITC, Xcel, MidAmerican Energy, Ameren and American Transmission Co., the company says. In SPP, IOUs have been responsible for all but a few projects.

Meanwhile, public power rates have been increasing, with MJMEUC’s rates doubling under SPP’s highway-byway cost allocation. And 70% of public power transmission lines and transformers are at least 25 years old.

“Working together, we will have the necessary scale and resources to more effectively invest in, develop and construct new transmission infrastructure,” Rahill said.

Outsourcing

The deals announced Sept. 1 will give GridLiance operational responsibility for Tri-County’s 410 miles of transmission and Nixa’s 10-mile, 69-kV transmission line between Springfield and the Southwest Power Administration.

Jack Perkins, CEO of Tri-County, which has about 23,000 customer meters in the Oklahoma Panhandle, said the deal will allow the co-op to complete transmission reliability projects that it could not have otherwise afforded while outsourcing transmission operations. “Additionally, we will be able to reallocate funding and resources to upgrade our distribution system,” he said.

Doug Colvin, public works director for Nixa, said it no longer makes sense for the city of 21,000 to own its transmission infrastructure. “As regulatory requirements became increasingly complex, the city evaluated a number of options to protect our residents against rising costs and, at the same time, maintain our high reliability standards,” he said. “The GridLiance transaction ensures that we can meet these important requirements, as well as opens the door for our involvement in new transmission projects that can offset rate increases and provides us a much needed seat at the planning table.”

September 15, 2015

State Briefs

RGGI Allowances Clear at $6.02

The nine Northeastern and Mid-Atlantic states participating in the Regional Greenhouse Gas Initiative last week said the 29th auction of CO₂ allowances on Wednesday sold at a clearing price of $6.02. The price is 23% higher than the clearing price from a year ago.

Proceeds for the auction were $152 million, which brings the cumulative total for the program to $2.26 billion for investment in clean energy and energy efficiency programs in the member states.

Bids for the CO₂ allowances ranged from $2.05 to $10 per allowance.

More: RGGI

IOWA

FERC Ruling Could Clear Way for School District’s Solar Project

A recent FERC ruling may clear the way for a local school district to generate solar power and sell its excess production to its host city.

The Rudd-Rockford-Marble Rock Community School District wanted to install a 750-kW system, which would produce twice the energy it needs. It proposed to sell the excess to the city of Rockford. But the Rockford municipal utility has a contract with wholesaler Municipal Energy Agency of Nebraska (MEAN) and argued that it would be violating the terms of its contract if it bought power from the school district.

A recent FERC case regarding a similar situation in Colorado ended in favor of a new solar generator, citing the Public Utility Regulatory Policies Act. Another utility has asked FERC to clarify its ruling, and the school district and MEAN are awaiting that review.

More: Midwest Energy News

MARYLAND

Low-Income Residents Can Receive Help with Bills

The application period is open for state residents who are having trouble paying their energy bills to get some help from the federal Low Income Home Energy Assistance Program.

John Allen, Delmarva Power and Light regional vice president, said the block grant program doesn’t pay anyone’s entire bill.

But, he said, “The financial assistance can help someone get through a crisis, a really cold winter or a dangerously hot summer.”

More: The Star Democrat

MASSACHUSETTS

North Adams Boasts Largest Solar Farm

North Adams is now generating more solar power than the entire state did in 2007.

A 3.5-MW facility atop a former landfill, which feeds electricity into the power grid and is purchased back by the city at a reduced rate, is expected to produce most of the energy consumed by the city’s buildings, streetlights and other operations.

Combined with two other smaller solar projects with which the city has agreements, North Adams expects to offset all of its electricity usage with solar power. The city expects to save more than $400,000 a year now that the landfill solar facility is up and running.

More: Berkshire Eagle

MINNESOTA

Minnesota Power’s IRP Forecasts Move from Coal

Minnesota Power has told the Public Utilities Commission it will continue to move away from coal-fired electricity over the next 15 years and generate more power from natural gas, wind and solar sources.

The company’s 15-year integrated resource plan, which is filed biennially, lays out a pathway to comply with the Environmental Protection Agency’s Clean Power Plan. Minnesota Power pledged to add 200-300 MW of natural gas generation over the next 15 years, but the 500-page plan does not say where and when that will happen, or which of its coal-fired generators it will retire.

Environmental groups have pressed for a faster reduction in coal generation. Minnesota Power says that it needs to maintain a base of coal-fired plants to supply its large industrial customers.

More: Duluth News Tribune

PUC Revokes Licenses for 2 Wind Projects

The Public Utilities Commission has revoked licenses for the Sibley Wind Substation and Comfrey Wind Energy project.

Sibley Wind, a 10-turbine farm rated at 20 MW, asked for its construction permit to be withdrawn to address ongoing opposition based on bird- and bat-death concerns. The project’s management said it would try to meet with opposition members and attempt to “find a solution to answer their concerns.”

Comfrey Wind began construction before the end of 2014 to qualify for the federal Production Tax Credit without completing full compliance filings. Comfrey Wind President Pete Samuelson urged the PUC to show some compassion. “Comfrey asks that the commission understand and empathize that Comfrey had no choice but to perform minimal construction work, without holding a pre-construction meeting, prior to the end of 2014 to qualify for the PTC.” Comfrey is rated at 31.5 MW and includes 17 turbines on nearly 4,000 acres.

More: The Free Press

NEBRASKA

NPPD Offering Lower Rates for Long-Term Commitments

Nebraska Public Power District is considering offering lower rates in 2016 for cities, power districts and other wholesale customers that sign new 20- or 25-year commitments. A proposal during the August board of directors meeting sets the potential wholesale rate increase at just 0.6% for entities that enter into a new agreement. Customers who don’t commit themselves would get a 3.8% increase.

NPPD’s contracts with wholesale customers — including 51 communities and 25 public power districts and cooperatives that resell electricity to their retail customers — do not expire until the end of 2021. NPPD has been working on a plan to extend those contracts and improve its long-term financial stability.

The board is expected to vote on the 2016 rates in November. NPPD has raised its wholesale rates about 60% in the past nine years.

More: Columbus Telegram

NEW HAMPSHIRE

Northern Pass Funds Rejected

The North Country Community Recreation Center’s board of directors has voted to return a $10,000 grant from a fund created by the owner of the controversial Northern Pass project.

“We can’t just take a payoff,” said John Fothergill of the NCCRC board of directors. “We look to partner with our funders. We’re unclear about the Northern Pass Fund partnership intentions except that this seemed like an award for their own immediate public relations needs.”

The money came from the Coös County Jobs Creation Association, which was created by Northern Pass developer Eversource Energy. John Gallus, a former state legislator who chairs the association, said there were absolutely “no strings attached” to the award, other than that it be used to create or keep jobs in Coös County.

More: New Hampshire Union Leader

NEW JERSEY

PSE&G Pilot Program Donates EV-Charging Stations

Public Service Electric & Gas has donated 35 electric car charging stations at seven sites as part of pilot program aimed to help spur the market for EVs.

“The lack of convenient charging stations remains an impediment that keeps potential EV drivers from going all electric,” said Joe Forline, vice president for customer solutions.

PSE&G plans to donate 150 units under the $400,000 program, particularly to companies, colleges and hospitals.

More: NJ Spotlight

NEW MEXICO

PRC Commissioners Refuse to Recuse from San Juan Hearings

Two members of the Public Regulation Commission have said they will not disqualify themselves from hearing Public Service Company of New Mexico’s (PNM) plans for the controversial San Juan Generating Station, despite an environmental group’s call for them to recuse themselves because they are allegedly too chummy with the utility.

Commissioners Sandy Jones and Patrick Lyons filed responses to a motion by the nonprofit New Energy Economy seeking to disqualify four of the five PRC members from ruling on the utility’s plans for the coal-fired power plant near Farmington. PNM aims to close two of the San Juan plant’s four coal-fired units and replace the lost capacity with more power from another unit at the plant, as well as power from a proposed new facility and third-party sources.

The activists contend that emails between PNM executives, as well as public statements by some commissioners, show the regulators are too cozy with the utility and should excuse themselves from voting on the issue.

More: Santa Fe New Mexican

PNM Asks for 15.8% Rate Increase in Return for Lower Fuel Costs

Public Service Company of New Mexico (PNM) has filed for a rate increase that would boost residential rates by 15.8%, generating about $123.5 million in additional revenue.

PNM said the rate increase would be lower if the state’s Public Regulation Commission also approves its plan for the San Juan Generating Station. The company arranged a new coal-supply contract as part of the San Juan proposal, which would reduce the increase to 8.3% for the average residence, or about $6.07 a month on residential electric bills.

The five-member commission in May rejected PNM’s previous rate request. The new request no longer includes a new fee for solar customers to connect to the grid, which would have ranged from $21 to $26.

More: Santa Fe New Mexican

NEW YORK

Solar Farm Proposed in Monroe County

The Monroe County legislature is considering authorizing the installation of two solar farms on about 28 acres of vacant county-owned land. County Executive Maggie Brooks said the project would be the largest solar installation in the state outside of Long Island and save the county $7.3 million in energy costs over the next 20 years.

The farms would encompass five parcels of vacant land and house 42,000 solar panels, totaling 11 MW. Under the terms of the agreement, the county would lease the land to Buffalo-based Solar Liberty, which would install and operate the solar farms. In exchange, the county would buy electricity from Solar Liberty and sell it to Rochester Gas & Electric for transmission and delivery credits that county officials and Solar Liberty executives estimate would be worth about $366,000 annually.

Solar Liberty estimates the project would be complete by the end of 2016.

More: Rochester Democrat & Chronicle

NORTH DAKOTA

Clean Power Plan Presents Dilemma for Utilities

The Environmental Protection Agency’s Clean Power Plan is hitting close to home in the state, where the final rule requires power plants to cut their carbon dioxide emissions almost in half. Democratic Sen. Heidi Heitkamp has called EPA’s plan a “slap in the face.”

Utility executives wonder how they can meet the EPA targets in the coming years without raising electricity rates and affecting system reliability, given that much of the electricity in the state’s west-central region is generated from brown coal. Some executives are considering closing coal plants to meet the emissions target, but they say they’re still working to understand the implications of the regulations.

“What is a fear on my part is that we’ll make irreversible or irrevocable decisions, and you might look like a hero or you might look like an idiot,” said Robert “Mac” McLennan, president and CEO of Grand Forks-based Minnkota Power Cooperative.

More: Grand Forks Herald

OKLAHOMA

OG&E Customer Bills Lowered due to Lower Natural Gas Prices

Oklahoma Gas & Electric says lower natural gas prices and SPP’s Integrated Marketplace will mean lower bills for its customers. OG&E said the typical residential customer should see a monthly bill reduction of $5 starting this month.

OG&E, however, is also waiting on a final decision from the Corporation Commission on the utility’s $1.1 billion environmental compliance and replacement generation plan. The plan would increase customer bills 15 to 19% by 2019.

More: The Oklahoman

Solar Customers to See Changes Under OG&E’s New Billing Structure

Oklahoma Gas & Electric last month filed a new billing structure with the Corporation Commission that will add a demand charge for customers who install solar panels on their roofs. About 200 OG&E customers have installed rooftop solar.

The new rate structure for distributed generation customers would have four parts: a demand charge, an energy charge, a fuel charge and a customer charge. That’s a change from current bills, which are comprised of an energy charge, a fuel charge and a customer charge.

OG&E said the new billing structure will eliminate any subsidization of distributed generation customers by other customers.

More: The Oklahoman

PENNSYLVANIA

Customer Fees Coming for New Smart Meter Program

The Public Utility Commission has approved PPL Electric’s plan to upgrade its smart maters. Installations are expected to start in 2017.

The meters will replace earlier devices installed in 2002 that are reaching the end of their useful life, according to the company.

The affected 1.4 million customers will soon begin paying a fee on their monthly bills expected to fluctuate from 58 cents in the beginning to $6.69 in 2019, the final year of installation.

More: The Morning Call

PECO Reliability Work will Raise Rates

PECO Energy customers will see their rates rise next year as the utility continues replacing equipment and upgrading infrastructure.

Under an agreement reached with the Public Utility Commission, the average monthly bill increase for residential customers will be $4.17. Small businesses will see their bills rise $17.02; for large businesses, the increase is $432.32.

The rates will translate to $127 million in increased annual income for the company.

More: Philadelphia Business Journal

TEXAS

PUC Commissioner Concerned over Hunt’s Oncor Acquisition

Public Utility Commissioner Ken Anderson has filed a memo saying the agency must determine whether Hunt Consolidated’s bid to take over bankrupt power distributor Oncor gives “tangible and quantifiable benefits to ratepayers.” Anderson said the commission raised similar concerns in 2008 about the $45 billion leveraged buyout of TXU, which created Energy Future Holdings — whose bankruptcy is setting the stage for the Oncor sale.

Dallas-based Hunt filed a proposal with a federal court in August to split EFH into two companies as part of EFH’s $40 billion bankruptcy proceedings. Hunt and a group of creditors would raise $12 billion to take over Oncor, Texas’ largest power distributor with more than 119,000 miles of power lines. EFH’s power-generating division Luminant, which owns coal-fired power plants, and its retail electricity unit TXU Energy would be owned by a different set of creditors.

Anderson’s concern is that Oncor would become part of a real estate investment trust largely to avoid being hit with a big tax bill. Observers say a transaction of similar size has never been attempted.

More: Fort Worth Star-Telegram

VIRGINIA

Appalachian Power Plans Upgrade Project

Appalachian Power is seeking regulators’ permission to upgrade a transmission line serving Bland and Wythe counties as well as a small portion of Mercer County in West Virginia.

The Bland Area Improvements Project would upgrade 20 miles of existing line, add about 5 miles of new line and create a new substation.

Construction on the $80 million project would begin late next year, with a projected in-service date of December 2018.

More: SWVA Today

WISCONSIN

Dane County Gives up Efforts to Force More Money out of Enbridge

Officials in Dane County are giving up their attempts to force pipeline company Enbridge Energy to pony up money to be held in case one of the company’s pipelines breaks and spills oil.

“It’s just fruitless,” lamented county zoning administrator Roger Lane, who said his county’s efforts were blocked by state lawmakers.

The county wanted to make a $25 million bond a requirement for its approval of a zoning permit for a pipeline pump station. But Gov. Scott Walker signed a state budget that, as a provision, forbade local entities from requiring pipeline insurance. The county wanted the provision because of perceived issues getting Enbridge to pay for damage related to a Michigan spill.

More: Wisconsin State Journal

September 15, 2015

PJM Market Implementation Committee Briefs

VALLEY FORGE, Pa. — DC Energy’s Bruce Bleiweis appears to face an uphill fight in his effort to win a rule change to mask the ownership of financial transmission rights.

Bleiweis’ problem statement won 61% support in a roll call vote of the Market Implementation Committee last week following protests from some members and the Independent Market Monitor.

Most problem statements are approved by acclamation, but members made clear there were too many differing opinions for such an endorsement in this case. Bleiweis would need to boost his support to a sector-weighted two-thirds majority to win approval at PJM’s senior committees.

Currently, all RTOs publish the identities of FTR holders when posting auction results. However, PJM does not disclose the ownership of other products, according to Bleiweis. (See “PJM Asked to Consider Masking FTR Ownership” in PJM Market Implementation Committee Briefs.) ISO-NE has begun a process by which it will post FTR market data only in the aggregate, according to the problem statement.

“We think this is a terrible idea,” said Market Monitor Joe Bowring, noting, as other speakers did, that members at the same time are being asked to consider relaxing some rules around data confidentiality. (See “Conversation Continues on Relaxing Confidentiality Rules,” below.)

“Reducing transparency at a time we’re talking about increasing transparency is a bad idea,” he said.

Carl Johnson, representing the PJM Public Power Coalition, concurred. “We would not support this as a one-off proposition,” he said. “It goes against transparency.”

Steve Lieberman of Old Dominion Electric Cooperative agreed. “From where I sit, it’s bad timing,” he said. “We just don’t view this as a problem.”

Bleiweis said the ownership disclosure was a problem because it allowed people to analyze companies’ positions, which can lead to unfair market advantages.

“We’ve spent 10 years advocating for more transparency. At this point, we just want parity because we haven’t gotten any sense that membership will move toward more transparency with other products,” he said. “We just want to be treated like everybody else.”

The initiative was assigned to the MIC. The work is expected to take three to five months.

Conversation Continues on Relaxing Confidentiality Rules

Members weighed in with their concerns in a discussion over proposed manual changes that would relax PJM’s data confidentiality rules.

The Markets and Reliability Committee approved a problem statement and issue charge on the subject in July. (See PJM Considering Release of Uplift, Outage Data.)

Under the proposed changes, PJM would be permitted to release data in six areas:

Concluded individual generation outages, if it was determined to be relevant to an event on the grid, such as severe weather;
Demand response reply available in localized areas;
The identities — but not the offers — of resources committed in capacity market auctions;
Uplift payments in an area no smaller than a transmission zone, for a time period no shorter than a single operating day;
Aggregated statistics related to the execution and results of the Three Pivotal Supplier test, an addition requested by the Monitor; and
Information already in the public domain.

Some members worried that details about generation outages during a severe weather event might allow competitors to calculate non-performance charges under the new Capacity Performance product. Others suggested that data in the public domain be restricted to information released by the affected company in order to ensure its accuracy. PJM also was asked to provide clarity regarding whom it would release such information to.

Changes Coming to Settlement Process?

PJM is considering changing rules governing how electric distribution companies correct settlement errors.

The Settlement C process allows EDCs to correct significant errors 60 days after an initial settlement is performed, but its efficacy is limited by a requirement that all affected parties must consent to the resettlement.

PJM introduced a problem statement and issue charge that would ask the Market Settlements Subcommittee to determine whether changes need to be made to the process.

The issue was brought to PJM’s attention by Dayton Power and Light, Direct Energy and Pepco Holdings Inc.

Implementation of any accepted proposals is expected by the third quarter of 2016.

Tier 1 Compensation Manual, Tariff Changes Delayed

The MIC deferred until its next meeting consideration of manual and Tariff changes designed to reflect a Tier 1 compensation proposal that members approved in July. The delay was requested by Dave Pratzon of GT Power Group.

Enhanced Security Updates in the Works

PJM is updating its security rules for accessing the RTO’s website, with changes to password length, security questions and timeout restrictions. Customer account managers and users will be able to start creating system accounts Sept. 15. The changes are expected to be complete in the second quarter of 2016.

— Suzanne Herel