Page 1486 – RTO Insider

January 12, 2016

Federal Briefs

Former FERC member Phil Moeller has signed on with the Edison Electric Institute as senior vice president of energy delivery and chief customer solutions officer, the organization announced after its winter meeting.

“I look forward to welcoming Phil to the EEI team,” said Nick Akins, EEI chairman and CEO of American Electric Power. “Phil’s diverse talents and considerable expertise in regulatory and legislative affairs will be incredibly valuable for the industry during a time of considerable change.”

Moeller will direct EEI’s energy delivery, retail energy services and state regulatory outreach activities. He left FERC last fall after two terms.

More: EEI

TransCanada Sues US for $15 Billion over Keystone XL

TransCanada, the developer of the Keystone XL pipeline project, has sued the U.S. for failing to issue crucial permits to allow the project to proceed. The company is seeking $15 billion in damages, saying the State Department’s denial of the permit for the $8 billion pipeline was “arbitrary and unjustified.”

TransCanada is suing under terms of the North American Free Trade Act in U.S. District Court in Texas, saying the Obama administration’s denial “exceeded his power under the U.S. Constitution.”

“In its decision, the U.S. State Department acknowledged the denial was not based on the merits of the project,” TransCanada said in the statement. “Rather, it was a symbolic gesture based on speculation about the perceptions of the international community regarding the administration’s leadership on climate change and the president’s assertion of unprecedented, independent powers.”

More: Scientific American

FERC Grants Columbia Permits for Utica Access

FERC on Friday approved Columbia Gas Transmission’s proposed $45 million Utica Access Project in West Virginia, designed to bring Appalachian shale gas to market. The project, which includes 5 miles of new pipeline and modifications to existing compression facilities, would supply up to 205 million cubic feet of gas per day to the Appalachia Pool.

The project is expected to be completed this year.

Columbia also filed an application with FERC for its WB Express project, which calls for construction of two new compressor stations, about 26 miles of pipeline replacement located along existing corridors and approximately 3 miles of new pipeline in Virginia and West Virginia. That system would deliver 1.3 billion cubic feet a day of shale gas to Mid-Atlantic and Gulf markets.

More: Columbia Pipeline Group

FERC Extends Comment Period for Northeast Energy Direct

FERC extended the public comment period for the Northeast Energy Direct pipeline until Jan. 15 after what it described as errors in its online comment system in late December and the first few days of January.

Kinder Morgan’s plan is to build a $5 billion, 415-mile pipeline to carry shale gas from Pennsylvania through New York to New Hampshire and Massachusetts. The comment period was set to end Jan. 6, but the errors kept some parties from filing comments.

More: KallanishEnergy

DOE Selects Team to Explore Borehole Disposal Method

The Energy Department has appointed a team to research the feasibility of drilling deep holes into a crystalline rock structure in North Dakota as a possible method of storing nuclear waste. A team from the Battelle Memorial Institute will drill a test hole in the formation near Rugby, N.D., as part of the project.

Energy Secretary Ernest Moniz said there could be several uses for such deep drilling, including waste disposal or geothermal energy development. It’s not a new idea. More than 40 years ago, the government examined the possibility of drilling into granite formations to store weapons production nuclear waste, but no active project came of that.

The department said it would commit $35 million to the Rugby project over the next five years.

More: Department of Energy

EPA Chief Says Office Will Push to Maintain Climate Gains

EPA Administrator Gina McCarthy said last week that the coming year will see ambitious moves by the Obama administration to maintain and build on gains it has made fighting greenhouse gas pollution.

“We’re not just going to stay with what we’ve already done,” she said in a speech before the Council on Foreign Relations. She said the administration will continue to press for additional gains, in part by assisting other countries.

“Countries want to do it, but many of them don’t have the capacity at this point,” McCarthy said. “A lot of what the EPA is doing is sharing expertise — on how to do the work and also on the benefits it brings, so it’s not seen as a chore but as an opportunity.”

More: The Washington Post

House Republicans Seek to Block EPA Clean Water Rule

House Republicans are set to consider a bill that would block the EPA Clean Water Rule, arguing the rule gives the government too much control over uses of the nation’s waterways.

The House Rules Committee is planning to take up a Congressional Review Act of the rule this week. It is a step before the rule goes before the House for a final vote. The Senate in November passed a CRA resolution.

“My legislation is the necessary next step in pushing back against this blatant power grab by the EPA,” Sen. Joni Ernst (R-Iowa), the resolution’s sponsor, said in November. If the House passes the resolution, President Obama likely would veto it.

More: The Hill

January 12, 2016

FERC Orders Sloped Zonal Curves for FCA 11

By William Opalka

Its patience strained, FERC has ordered ISO-NE to develop rules for sloped demand curves in constrained areas in time for the 11th Forward Capacity Auction in 2017.

The commission ruled Dec. 28 that the ISO-NE Tariff is unjust and unreasonable because it uses vertical demand curves in constrained zones, “which does not sufficiently address concerns such as price volatility and a susceptibility to the exercise of market power.”

The commission opened a Section 206 proceeding (EL16-15) requiring the RTO to file Tariff revisions by March 31 and implement new rules for FCA 11 (delivery year 2020/21).

ISO-NE, NEPOOL Oppose Demand Curve Change.)

But it tired of the delays after the RTO said last May that it would be unable to institute sloped zonal curves for FCA 10. “Now, nearly a year after that [January 2015 deadline] … ISO-NE still has not filed with the commission to incorporate the use of sloped demand curves for the constrained zones,” the commission said.

“The continued delay creates uncertainty for market participants and the continued use of vertical demand curves in constrained zones results in less efficient markets and affects confidence in market outcomes. Accordingly, the general challenges cited by ISO-NE do not justify further delay.”

When vertical demand curves are used, FERC said, even small changes in supply can cause price volatility because a fixed amount of capacity must be procured. “In addition, because a small decrease in supply can lead to a significantly higher price, sellers may have an incentive to withhold certain resources,” it said.

FERC’s previous orders directed the RTO to eliminate the need for administrative pricing in zones that are short of generation resources or suffer from transmission constraints.

The problem of administrative pricing is acute in the Southeast Massachusetts/Rhode Island zone. In FCA 9, inadequate resources were offered in that zone, which forced administrative prices at $17.73/kW-month for 353 MW of new resources and $11.08/kW-month for 6,888 MW of existing resources. The other zones with adequate resources cleared at $9.55/kW-month.

The commission’s latest order also dismissed as moot a June 2015 motion by the New England Power Generators Association that sought to impose a sloped demand curve for FCA 10. (See NEPGA: Order Sloped Demand Curve in FCA 10.)

“NEPGA will have the opportunity to raise concerns when ISO-NE submits its zonal sloped demand curves proposal,” the commission said.

January 12, 2016

SPP, MISO Working on M2M Improvements

By Tom Kleckner

Nearing the end of the first year of market-to-market (M2M) operations, SPP and MISO are negotiating a set of “guiding principles” to improve the process and reduce congestion costs along their seams.

The M2M process was instituted last March to improve price convergence on flowgates along the seams. Under M2M situations, SPP and MISO compensate each other for re-dispatching generation that lessens congestion in a way that reduces overall costs.

“We’re not comfortable [M2M] has worked the way it should in all cases, and we think there’s room for improvement,” David Kelley, SPP’s director of interregional relations, told SPP’s Seams Steering Committee on Jan. 6, repeating a point he has made several times in recent months. “We’ve tentatively agreed upon certain things we believe can improve the process.”

The seven principles include excluding reciprocal coordinated flowgates from the M2M process based on a threshold test for generators that affect it; recalculating firm-flow entitlements (FFE) due to changes in facility ratings; capping FFEs to the system operating limits for M2M flowgates; and switching between market flow and total flow control modes during M2M events.

Kelley said SPP and MISO have been discussing the principles and negotiating on how best to make improvements for several months. Staff from the two RTOs met Friday to share feedback from their respective stakeholders on the guiding principles.

Work in Process

Two of the principles describe in what circumstances the RTOs would switch to market flow or total flow control mode. Kelley told the committee the RTOs are already using a market flow control mode, in which they only manage the transmission in their own markets, during M2M events on certain flowgates as a temporary solution. He said switching total flow control to the non-monitoring RTO — managing all of the transmission on that line or flowgate — will require software changes and revisions to their joint operating agreement. Capping FFEs would also require software updates and JOA revisions.

While the payment amounts between the two have decreased in recent months, abnormalities continue to crop up along the seams. (See M2M Process Shows Continued Improvement.) In November, a temporary flowgate in Minnesota recorded 139 hours in M2M, resulting in a $1.075 million payment from SPP to MISO.

“The principles don’t resolve all the issues in [M2M],” Kelley said, “but from SPP’s perspective, we think these are good improvements to make. We should move forward with them so we don’t see situations like the [Minnesota] transformer, where the process isn’t working.”

Committee Chair Paul Malone, of the Nebraska Public Power District, asked whether the RTOs would have been better off using transmission-loading relief procedures, such as cutting non-firm transmission during periods of congestion. Kelley responded they would have been “in some cases.”

‘Trigger’ Sought

Marguerite Wagner, director of RTO policy for ITC Holdings, called for a triggering mechanism that would send recurring congestion points into the transmission-planning process. “Whether it’s ‘X’ amount of dollars or frequency,” she said, “something to throw it over into the planning process.”

“I absolutely agree,” Kelley said. “I think you will see some activity around that this year.”

SPP and MISO will continue to hold JOA stakeholder meetings to discuss seams issues, but the frequency has been reduced from quarterly to biannual.

The steering committee also reviewed and discussed FERC’s Nov. 30 order, which rejected SPP’s proposal to create a new class of seams transmission projects (ER15-2705). (See FERC Rejects SPP Proposal for Seams Transmission Projects.)

FERC said the Tariff revisions did not go into enough detail about joint studies. The group decided to wait for FERC orders on regional and interregional cost allocations, expected in the spring, rather than rewrite the compliance filing.

New Members

The committee welcomed seven new members during its first meeting of the year: Wagner, Jim Jacoby (American Electric Power); Katy Onnen (Kansas City Power & Light); Jason Atwood (Northeast Texas Electric Cooperative); Steve Sanders (Western Area Power Administration-UGPR); Ray Bergmeier (Sunflower Electric Power Corporation); and Jordan Schmick (Xcel Energy).

With the additions, the committee is now composed of seven transmission-owning members and six transmission-using members, covering New Mexico up to Montana.

Ironically, AEP’s Richard Ross, who resigned from the committee last year, served as Jacoby’s proxy during its first meeting of the year. “I know, I know,” he said with a sigh during the roll call.

January 12, 2016

Court Next Stop for Developer, FERC Says

FERC said Friday it would not take up a renewable energy developer’s complaint about Connecticut’s procurement practices, clearing the company to return to court (EL16-11).

Allco Renewable Energy had asked FERC to begin an enforcement action under the Public Utility Regulatory Policies Act, saying it had been excluded by the state’s improper selection of a too-large, out-of-state wind project.

Allco filed the FERC complaint in November after its federal court suit against the state was dismissed because the company had not exhausted its administrative remedies. The Connecticut Department of Energy and Environmental Protection and the Public Utilities Regulatory Authority last month asked FERC to dismiss the complaint. (See Connecticut Seeks Dismissal of PURPA Complaint.)

“Our decision not to initiate an enforcement action means that Allco may themselves bring an enforcement action against the Connecticut commission and DEEP in the appropriate court,” FERC wrote.

FERC said Friday it would not take up a renewable energy developer’s complaint about Connecticut’s procurement practices, clearing the company to return to court (EL16-11).

“Our decision not to initiate an enforcement action means that Allco may themselves bring an enforcement action against the Connecticut commission and DEEP in the appropriate court,” FERC wrote.

— William Opalka

January 12, 2016

MISO Seeks Bids on Duff-Coleman Project

By Amanda Durish Cook

MISO opened the floor on Friday to transmission developers’ bids for the congestion-relieving Duff-Rockport-Coleman 345-kV project in Southern Indiana and Kentucky. Developers have until July 6 to submit bids on the four-year construction project, and developer selection is planned to begin thereafter.

The call for proposals marks MISO’s first-ever competitively bid transmission expansion project under FERC Order 1000.

Forty-eight transmission developers are certified to submit bids. Non-qualified developers can submit applications for certification through Feb. 8.

6-Month Review

MISO has allowed for a roughly six-month review of developers’ proposals and plans to announce its choice before Dec. 30. The estimated in-service date is Jan. 1, 2021.

“Through extensive work with stakeholders to develop the competitive transmission process, MISO is ready to engage in a fair process to select a developer for Duff-Coleman,” Priti Patel, regional executive for MISO North, said in a statement. She said the proposals will be judged “in terms of certainty, specificity, risk mitigation and cost.”

MISO Staff Recommends 3 Economic Projects.)

The project has been designated by MISO as a market efficiency project. MISO’s Board of Directors approved it, along with more than 350 other transmission projects, as part of the 2015 Transmission Expansion Plan in December.

“This project completely mitigates the congestion on the MISO system around the Newtonville and Coleman areas and strengthens the 345-kV backbone in the region,” MISO wrote in its MTEP15 report. “In addition, the project fully addresses long-standing reliability issues around PJM’s Rockport station and obviates the need for the Rockport special protect scheme and operation guide that protects the stability of the grid.”

January 12, 2016

MISO Redesign Proceeds with New Committee

By Amanda Durish Cook

CARMEL, Ind. — MISO stakeholders Monday laid the foundation for the Resource Adequacy Subcommittee (RASC), hammering out a rough mission statement and management plan while determining it should report to the Advisory Committee.

The work took place during the first of a two-day work session of the Stakeholder Governance Working Group, which continues Tuesday.

Bill SeDoris, director of MISO integration for Northern Indiana Public Service Co., said he used pieces of the Supply Adequacy Working Group’s mission statement to outline the new panel’s role.

The RASC’s mission statement says the subcommittee will “provide input and policy guidance to MISO management and the Advisory Committee on all market and operational activities and processes to facilitate adequate planning resources within the MISO for the long-term planning horizon.”

The RASC will “coordinate its efforts with other MISO stakeholder groups, including all entities reporting to the Advisory Committee,” according to the draft mission statement.

Renuka Chatterjee, executive director of resource adequacy and transmission access planning, will serve as MISO liaison for the RASC.

“It’s certainly a [fresh] start,” said Michelle Bloodworth, MISO’s executive director of external affairs.

Next Stop, Steering Committee

Now it’s up to the Steering Committee to decide whether to approve the charter and management plan at its Jan. 27 meeting. If the subcommittee is sanctioned, a call for leadership and elections is planned for sometime in February with a first meeting slated for March that will review preliminary data stemming from the upcoming Planning Resource Auction.

Auction discussion will again make an appearance on the April agenda, with a special conference call planned to discuss results. The subcommittee will follow a monthly meeting schedule.

The new committee is part of stakeholder efforts to complete the RTO-wide redesign. (See MISO Stakeholders OK Redesign, Begin Implementation.)

Strategic Planning Continues

The Stakeholder Governance Working Group on Monday also continued work on setting priorities as part of MISO’s strategic planning process. The group is charged with putting together both a priority-setting process for other committees and its own list of priorities. The group picked up where discussions left off at last week’s Advisory Committee meeting.

MISO Vice President of Strategy and Business Development Wayne Schug identified five priorities on which the RTO wants to concentrate in 2016: the Clean Power Plan; improving coordination between the electric and gas systems; seams optimization and aligning border pricing; grid technology enhancement and storage; and infrastructure development. “We’ve gone from a system that’s had virtually zero wind to 15 GW of wind,” Schug said. The CPP could push wind’s contributions to 50 GW over the next few years, Schug said, and the grid has to be ready to deliver.

Gary Mathis, senior director of electric policy at Madison Gas and Electric, said he hoped stakeholders and RTO officials can align their priorities.

“It’d be hard to argue against striving for a great deal of consistency between MISO’s priorities and [priorities identified by the Advisory Committee],” Mathis said.

‘Middle Ground’

Stakeholders at the SGWG meeting favored what several called a “middle ground” approach where stakeholders can influence the RTO’s strategic priorities through recommendations for change.

Additionally, the Advisory Committee put out a request for stakeholders to brainstorm ideas on priorities and how they’re formed during a meeting on Jan. 8.

“We didn’t really talk about this in the Advisory Committee in December. There was never really any discussion on the priorities for the year,” said committee Chair Audrey Penner. She said the committee will have a bigger role in policy formation in 2016.

Dynegy Director of Regulatory Affairs Mark Volpe asked if the committee might move policy discussions and priority reviews to the mornings of its meetings, when MISO board members would be more likely to attend. Currently, board member attendance is heaviest in the mornings during “hot topic” discussions, and tapers off in the afternoons when committee priority discussions take place.

Schug told the Advisory Committee that MISO is eyeing an approach on priority setting where parent committees, such as the AC, have the power to delegate tasks based on priorities, but stakeholders would have preference when it comes to identifying issues that eventually become MISO priorities.

Redesign Discussion

Last week’s discussion also dipped into stakeholder redesign. Chris Plante of Wisconsin Public Service Corp. asked if parent entities should be the only ones allowed to identify priorities to the Advisory Committee or if task groups and working groups could also name primary issues. Tia Elliott, director of regulatory affairs at NRG Energy, said that it could be helpful if such groups take priorities to their parent entities before they’re put before the Advisory Committee.

“The value to me of this exercise is sifting through all of the various priorities and finding the most important ones,” said Kent Feliks, American Electric Power’s manager of regulatory and RTO policy.

Penner said prioritization of issues will continue to be a main theme for MISO, and the Advisory Committee is considering planning an off-site meeting around mid-February for stakeholders to weigh in on the strategic planning process.

January 12, 2016

Vermont OKs Canadian Hydro Line

By William Opalka

The Vermont Public Service Board on Tuesday approved a 1,000-MW transmission line to bring Canadian hydropower into New England, completing state and federal review of a project that could begin construction this year.

The New England Clean Power Link, proposed in 2013 by a unit of the Blackstone Group, is scheduled to be in service in 2019.

“The NECPL will provide significant environmental, electrical and economic benefits for Vermont and the region, including diversifying the state and regional fuel supply, reducing greenhouse gas emissions, creating in-state jobs, producing millions of dollars in new state and local taxes and public good benefits, and potentially lowering electricity costs,” the order said (Docket # 8400).

Blackstone Group unit TDI New England began its open season last month and reported expressions of interest from seven potential customers on both sides of the border. (See Infrastructure Build-out Moves to Forefront in New England.)

The company’s project timeline calls for completion of an interconnection study and project financing, execution of transmission service agreements and the beginning of construction in 2016.

Ninety-eight miles of the cable would be buried under Lake Champlain, and most of its land-based route would be underground to Ludlow, Vt.

The order noted that the project “will not be without impacts.” It cites a large, above-ground station to convert direct current power to alternating current. Travelers on Vermont highways where the HVDC line will be buried will be inconvenienced during construction.

“However, we conclude that the project’s benefits are significant enough to outweigh any potential negative effects, thus promoting the general good of the state,” regulators said.

The U.S. Department of Energy approved the project last year. (See Energy Department OKs Canadian Hydro Line in New England.)

Competing Project

A competing project, the Northern Pass, would deliver 1,090 MW through New Hampshire and is also scheduled to deliver energy in 2019.

Its opponents say the speed in which the Clean Power Link has progressed through the approval process means it is likely to deliver energy first. That clouds the prospects for the New Hampshire project ever getting built, they say.

However, a spokeswoman for Northern Pass has said that project has an interconnection approval from ISO-NE, a confirmed supplier of energy in HydroQuebec and a commitment from Eversource Energy to buy some of the electric power.

Massachusetts Gov. Charlie Baker is pushing legislation that could allow the state’s suppliers to buy up to 1,200 MW of power in addition to the needs of neighboring states.

January 12, 2016

MISO Market Subcommittee Briefs

MISO told the Market Subcommittee it will agree to a FERC order requiring it to post day-ahead market results at least 30 minutes before the 2 p.m. Eastern Prevailing Time gas timely nomination deadline. (See FERC Orders MISO to Shift Electric Schedule.)

However, MISO’s Kevin Larson said the compliance filing will include a rehearing request asking that its day-ahead schedule not adjust for daylight saving time.

Prevailing time reflects the shifts between standard time and daylight time, when clocks move ahead by one hour between the second Sunday in March and the first Sunday in November.

“Our practice of using Eastern Standard Time dates back to 2006 because Indiana was an oddball state and didn’t use daylight savings,” Larson said.

A decade later, MISO says it can’t “quantify any benefits” in transitioning to daylight saving time and says the cost of the switch would be burdensome to market participants.

“Implementing semi-annual transitions to and from DST will result in significant impact and cost to MISO and our market participants,” MISO wrote in a presentation.

As proposed by MISO, the day-ahead clearing window will close at 10:30 a.m. with results published by 1:30 p.m. EPT.

It would maintain the 6 p.m. EPT Forward Reliability Assessment Commitment (FRAC) notification time and the one-hour FRAC rebid period. Because the RTO publishes FRAC results as available, it said the deadline has little impact on when market participants actually receive notification.

MISO to Begin SPP Settlement with $16 Million Payment

MISO is about to make a one-time, $16 million payment to SPP to cover excess flow charges over the past two years under the settlement the RTOs agreed to in October. (See SPP, MISO Reach Deal to End Transmission Dispute.)

Beginning in February, MISO will send SPP $1.33 million monthly to cover flows over 1,000 MW crossing MISO’s North-South interface. The monthly payments will continue until February 2017, when the monthly amounts will be based on prior year usage.

John Weissenborn, MISO’s director of market services, said a true-up between the payments and the actual north-south flows from February 2015 through the end of January will take place in June.

As an interim measure, MISO will collect the $1.33 million monthly from members through a miscellaneous charge based on market load ratio share (load and export schedule volumes).

MISO stakeholders are continuing settlement discussions to determine a final cost allocation mechanism (ER14-1736). “These miscellaneous charges will be used until cost allocation talks are finalized,” Weissenborn explained.

MSC Approves Charter, Management Plan

The Market Subcommittee approved without objection a charter nearly identical to last year’s. The committee also adopted its 2016 management plan, which lists the issues it expects to cover in its monthly meetings.

Chairman Kent Feliks described the plan as a “snapshot” of the group’s coming work, saying it would be subject to change. Among the issues included in the plan are an evaluation of the energy offer cap, implementing five-minute settlement calculations and coordinated transaction scheduling with PJM.

Demand Response Talks in Limbo

Stakeholders rejected a suggestion to table discussion of three initiatives regarding aggregation of demand response resources and lowering the 5-MW minimum participation threshold.

“The question was should they keep pushing the rock uphill… [The Demand Response Working Group] has been spinning their wheels on this for some time,” said Jeff Bladen, MISO’s executive director of market design.

Several stakeholders said the issues were still legitimate and deserved to be kept alive.

But with the working group slated for retirement under the RTO’s redesign, it is unclear when or where the issues will arise next.

Monitor Reports Quiet Fall Quarter

MISO’s fall quarter was defined by falling energy prices, said MISO Market Monitor David Patton of Potomac Economics in a quarterly report to the Market Subcommittee.

Patton reported a 40% reduction in natural gas prices at both the Chicago Hub and the Henry Hub, with the average price at less than $2.50/MMBtu during the quarter.

The average price of power in the footprint fell below $22/MWh in November. For the quarter, the real-time price was $24.96/MWh, 13% lower than the summer quarter and 27% lower in a year-over-year comparison.

“It wasn’t a particularly exciting quarter,” Patton said.

Patton also said his staff is still gathering information on the November Texas price spikes caused by congestion. (See MISO Monitor Auditing Tx Outages that Caused Price Spikes.)

The annual State of the Market Report, expected by April, will include an analysis of the effectiveness of extended locational marginal pricing (ELMP), Patton said.

— Amanda Durish Cook

January 12, 2016

PJM Planning Committee TEAC Briefs

VALLEY FORGE, Pa. — Transmission reliability projects of less than 200 kV will be exempt from competitive proposal windows under Operating Agreement changes approved by the Planning Committee last week.

Such projects are almost always assigned to incumbent transmission owners because the solutions involve upgrades to existing transmission facilities and are located within, and allocated to, a single transmission zone.

PJM said the change will allow its engineers to focus on projects more likely to result in a greenfield project open to competition.

If the threshold had been in place for the 2014 and 2015 windows, it would have exempted 534 flowgates, said PJM’s Sue Glatz. The exemption will not apply to market efficiency projects.

The new rule contains two caveats that would require projects under 200 kV to go through a proposal window. In essence, they would be scenarios in which one or more projects could eliminate multiple reliability violations. (See “Action Delayed on Voltage Threshold for Competitive Projects” in PJM Planning Committee Briefs.)

Competitive developers previously had expressed reservations about the new threshold.

Sharon Segner of LS Power opposed the change because it does not provide a “catch-all” at the end of the planning process to put the project out for bid if it is determined to involve regional cost allocation.

“We believe that Order 1000 clearly says if there is regional cost allocation associated with a project, it needs to be opened to the competition,” she said.

PJM Vice President of Planning Steve Herling said performing a second analysis would defeat the purpose of the new rule.

“The idea of literally getting to the end and having a solution to recommend … and then stopping to bid the project out on essentially cost issues is not where we want to go,” he said, adding that PJM is “hoping” the screens it has in place will capture such projects.

Segner responded, “Hope doesn’t give us that protection from a new entrant standpoint. … Hope isn’t enough in light of Order 1000.”

PJM to Send Five Market Efficiency Projects to Board

Five market efficiency projects, all in the ComEd zone, will be presented to the Board of Managers for its approval next month.

Four involve upgrading capacitors at the Brambleton, Ashburn, Shelhorn and Liberty substations. The other is an upgrade to the 345-kV Loretto-Wilton Center line.

PJM planners also will recommend that the board advance the Hanover Pike baseline project, designated to Baltimore Gas and Electric, from a completion date of 2021 to 2019. While it remains in the Regional Transmission Expansion Plan based on its original designation as a reliability project, PJM is studying whether it might also provide market efficiency benefits.

Segner opposed the acceleration and noted that Northeast Transmission Development, an LS Power company, had expressed its objection as well in a letter to PJM.

Northeast Transmission previously had proposed a Keysers Run project that she said also would solve the Hanover Pike issue at a savings of about $46 million. The Keysers Run project had been identified as meeting the threshold for approval as a market efficiency project, she said.

“We think this is incredibly inappropriate in the middle of the cycle to take a project with an in-service date of 2021 and pull the project into the market efficiency process,” she said.

Herling said the project would remain with BGE despite the change in its status.

“We’re struggling with taking a project away from a designated entity once it’s been awarded,” he said. “That’s really the crux of the matter.”

Proposal Window to Open by End of January

PJM expects to open the first Regional Transmission Expansion Plan window of 2016 in the next few weeks.

Regardless of previous registrations, interested members must register before the window opens. The registration will be good for the year.

PJM’s new up-front, non-refundable project fee will go into effect for this window.

There is no fee to assess any project less than $20 million. There is a $5,000 fee to study projects from $20 million to $100 million. Projects that cost more will be charged a $30,000 fee. (See “PJM Lowers Proposed Tx Project Study Fee” in PJM Planning Committee Briefs.)

Phase Angle Regulators Qualify for Transmission Rights

PJM has determined that phase angle regulator (PAR) technology is eligible for transmission injection rights under the Tariff. The Planning Committee endorsed a new section to Manual 14E: Merchant Transmission Specific Requirements making that clear.

PJM’s review was requested in November 2014 by PSEG Energy Resources and Trading. (See “PAR Transmission and Withdrawal Rights” in PJM Planning Committee Briefs.)

Projects will be subject to automatic control. The guidelines also recommend that the initial “step size” of a facility’s output not exceed 20 MW when transitioning from zero flow because of concerns that a larger step could jeopardize stability. PARs will be studied based on proposed interconnection location on a case-by-case basis to determine impacts.

Task Force will Create Design Standards for Competitive Projects

The Planning Committee approved a charter for the Designated Entity Standards Task Force, which will set minimum design requirements for competitively solicited facilities.

The task force grew out of a problem statement approved in July following a review of the RTO’s initial Order 1000 experiences.

The standards will apply to transmission lines, substations and system protection and control design and coordination.

The task is expected to take 12 to 24 months.

— Suzanne Herel

January 12, 2016

PJM Market Implementation Committee Briefs

VALLEY FORGE, Pa. — The Market Implementation Committee discussed two proposals that would delay the disclosure of financial transaction right ownership following an auction.

The effort to mask FTR ownership has been championed by DC Energy’s Bruce Bleiweis, who contends that FTR owners should be afforded the same confidentiality as PJM’s other market participants. Faced with significant opposition, led by Independent Market Monitor Joe Bowring, Bleiweis has amended his proposal over the past few months. (See “Compromise Offered on Masking FTR Ownership” in PJM Market Implementation Committee Briefs.)

The package he presented last week would allow PJM to post aggregate data following an auction, masked ownership data three to six months later and full disclosure after one year.

“This is a significant evolution from where we started,” he said. “What we’re headed toward is no commercial information available while an auction is ongoing.”

Jeff Whitehead of Direct Energy suggested Bleiweis consider releasing masked information on auction close. “I’m not saying it gets me to ‘yes,’ but it gets me closer,” he said.

The second package, presented by PJM, is similar but would remove the tiered release of information to make it consistent with how the RTO releases other data, said PJM’s Tim Horger.

After posting aggregate data at the close of an auction, PJM would disclose the full ownership information four months later.

“We’re kind of indifferent to any changes associated with this,” he said. “We’re fine with the status quo. If membership wants change, that’s OK too.”

The packages will be brought back for a first read next month.

Market Data Confidentiality Rule Change Gets First Reading

The issue of market data confidentiality returned to the committee after one item regarding individual generation outages was tweaked since last month.

A spirited discussion over what and when PJM may disclose publicly has been going on since a problem statement was presented in June. (See PJM Considering Release of Uplift, Outage Data.)

Current rules prohibit PJM from talking about certain information even after it’s been disclosed publicly, such as the nuclear plant outages posted to the Nuclear Regulatory Commission’s website. They also limit the data PJM may share with stakeholders about conditions surrounding certain weather events, closed loop interfaces and transmission planning.

Stakeholders have debated for months over how to provide PJM the ability to discuss situations such as generator outages while at the same time not jeopardizing a member’s competitive standing in the market.

The current rule allows PJM to release aggregated data of more than three market participants and requires that information released involve a geographic area no smaller than a transmission zone.

PJM is proposing six exceptions that would allow PJM to the release or discuss:

Information on individual generation outages involving an unusual operating condition on the transmission system such as a severe weather event;
The amount of demand response in an area no smaller than three ZIP codes (specific offers or suppliers would remain confidential);
The total amount of capacity offered and cleared, aggregated by transmission zone;
Uplift payments in an area no smaller than a transmission zone, and for no shorter a time period than one operating day;
Aggregated statistics related to the results of the three pivotal supplier test; and
Data made public by a PJM member or a state or federal regulator.

“The intent here is not to be doing a monthly posting of widespread data,” said PJM’s Tom Zadlo. “It’s just the ability to answer questions from stakeholders.”

Operating Parameter Terms to be Defined

Members approved an issue charge to define terms related to operating parameters and move them from the eMKT/Gateway User’s Guide to PJM manuals. There was one abstention.

The 12 terms, including soak time, start-up time and minimum run time, also will be the focus of a special MIC session set for 1 to 4 p.m. on Jan. 19.

The committee is fast-tracking the issue in hopes of having the changes in place for the June 1 implementation of Capacity Performance.

— Suzanne Herel