Transmission owners will publicly post the calculations they use to allocate energy, capacity and transmission costs under a plan outlined to the Markets and Reliability Committee.
The proposal would add a page to the PJM website containing the methodologies transmission owners use to calculate total hourly energy obligations (THEO), peak load contributions (PLC) and network service peak loads (NSPL). The calculations are used to allocate cost responsibility among load-serving entities.
The issue arose because some TOs have not filed tariffs disclosing the methodology they use. Some members complained that the lack of transparency made it difficult to ensure they were being properly charged.
PJM officials told members last week they want to accelerate the schedule of the quadrennial review of the Cost of New Entry (CONE) by two months.
The proposed change would move the deadline for staff recommendations to May 15 from July 15 and the projected FERC filing to Oct. 1 from Dec. 1.
Executive Vice President for Markets Andy Ott noted that CONE calculations — which set the floor price for new generation resources looking to enter the capacity market — have been highly contentious in past years.
The two-month acceleration is “to give enough time for it to be litigated at FERC” before the capacity auction, he told the Markets and Reliability Committee.
The proposed change will be brought to a vote at the next MRC meeting.
Preparing for a new scheduling product, the Markets and Reliability Committee last week approved collateral rules for export transactions.
The changes to Attachment Q of the Open Access Transmission Tariff will apply to Coordinated Transaction Schedules, which are designed to reduce uneconomic power flows between PJM and NYISO.
Under CTS, traders would be able to submit “price differential” bids that would clear when the price difference between New York and PJM exceed a threshold set by the bidder. CTS were conditionally approved by FERC on Feb. 20 and will not be available to traders until at least November.
The record-setting cold pushed PJM’s load-weighted LMP to $126.80, more than three times the price in January 2012, officials told stakeholders last week.
The RTO’s gross billings for the month were $11.2 billion — about one third of the total for all of 2013. Collateral calls for the month totaled $2.6 billion, more than six times the total for all of 2013. (See charts.)
PJM officials told the Members Committee that they are combing through data in preparation for an April 1 technical conference called by the Federal Energy Regulatory Commission.
January 2014 Billing & Collateral Activity (Source: PJM Interconnection, LLC)
Acting FERC Chair Cheryl LaFleur announced the conference Feb. 27, saying it would focus in part on the experience in PJM, which called on demand response, a voltage reduction and voluntary appeals for conservation to avoid rolling blackouts in the face of record demand and large numbers of generator outages.
Investigations Sought
Consumer advocates from the PJM states on Feb. 14 asked FERC to investigate the causes of the high prices.
“It is becoming apparent that the unprecedented energy and ancillary service prices that occurred in January were not reflective of smoothly operating market fundamentals, but were, instead, reflective of significant and systemic inefficiencies,” the advocates wrote. “For example, we know that more than 40,000 MW of generation was unavailable during critical periods in January due to forced outages. This is the same generation for which consumers in the PJM region are paying billions of dollars in capacity payments each year.”
The American Public Gas Association, which represents publicly owned local distribution companies, asked the Commodity Futures Trading Commission (CFTC) Feb. 20 to examine the cause of a 10% jump in the February 2014 New York Mercantile Exchange (NYMEX) Henry Hub contract.
The association said natural gas for February delivery jumped 52 cents to $5.557 per MMBtu, the highest closing price in more than three years, during the final hours of trading on Jan. 29.
While he said the association had no evidence of manipulation, APGA President Bert Kalisch said “We are more concerned about the pervasive pricing impact of NYMEX and want to be certain that the market is liquid and operating correctly.”
Gerald Ballinger, chairman of the group’s Gas Supply Committee, noted that most public gas companies purchase gas under contracts priced off of a price index.
Inside FERC’s Gas Market Report calculated the February price at Texas Gas Zone 1 based on a survey of 18 trades, 17 of which were basic transactions priced off of NYMEX, he said. The price rose to $5.54/MMBtu in February, compared up from $4.34/MMBtu in January.
PJM’s attempt to address speculation in the capacity market collapsed Thursday as members failed for the second time in three months to reach consensus on rule changes.
The Markets and Reliability Committee was unable to muster a two-thirds sector-weighted vote for either PJM’s proposal or an alternate proposal from Old Dominion Electric Cooperative (ODEC) to eliminate opportunities to arbitrage between the Base Residual Auction and the Incremental Auctions. In all, there were four votes, including two that incorporated a late amendment addressing a potential loophole.
With the MRC deadlocked, the Board of Managers decided late Thursday to make a unilateral filing with the Federal Energy Regulatory Commission seeking approval of the PJM proposal.
Voting Blocs
The MRC votes showed a sharp division among stakeholders, with supply (generation and transmission owners) favoring the PJM proposal and load (electric distributors and end-use customers) backing ODEC’s. The same group dynamics played out in earlier votes at the MRC, in which proposals to increase compensation for black start generators failed. (See related story, Members Reject Pay Hike for Black Start Units)
Because clearing prices in incremental auctions (IAs) are usually lower than those in the base residual auction (BRA), participants can profit by selling capacity in the BRA and buying out their commitments in the IAs. PJM and the Market Monitor say such buyouts are suppressing capacity prices and could undermine system reliability.
The MRC had deferred a vote on the issue Nov. 21 after members of the Capacity Senior Task Force were unable to coalesce around any of 11 proposals. (See Arbitrage Fix Returned to Committee.)
The CSTF met five times after that to discuss alternatives, with PJM’s proposal winning 69% support. PJM’s solution would reduce the number of incremental auctions (currently three) and set conditions eliminating the potential to arbitrage between the BRA and IA. The ODEC proposal would also increase the penalties for failing to deliver promised resources, but by less than the PJM package. (See Stakeholders Back PJM on Arbitrage Fix.)
As often happens, however, the seeming support at the lower committee evaporated in the broader sector-weighted voting at the MRC.
Four Votes
PJM’s proposal won only 40% support in the initial vote, with strong support from the generation (67%) and transmission owner (85%) sectors, and opposition from electric distributors (6%), end-use customers (0%) and other suppliers (43%).
In contrast virtually all of the distributors and end users voted for the ODEC proposal, while it was shunned by generation (17%) and transmission (8%). It got 54% overall — well short of the two-thirds needed to recommend it to the Federal Energy Regulatory Commission.
Price Convergence
Several members said the price differential between the BRA and IAs is due in part to PJM’s persistent overforecasts of load. “What’s being done about the forecasts?” asked Dan Griffiths, representing the Consumer Advocates of PJM States (CAPS).
PJM Executive Vice President of Operations Mike Kormos said the load forecast problem is a result of economic performance that has lagged behind the growth rates incorporated into PJM’s load calculations. “The algorithm — if you get the economy right — is quite accurate. The problem is the economy has lagged for five years.”
Susan Bruce, representing the PJM Industrial Customers Coalition, said PJM’s proposal would have “artificially” closed the price gap “at the expense of load.”
Loophole
After the first two votes, discussion then turned to an amendment proposed by PJM to close a loophole regarding capacity acquired through bilateral trades. The amendment would have imposed a “settlement charge” on any party replacing capacity equal to the difference between the BRA and IA clearing prices.
J.P. Morgan’s Bob O’Connell then proposed a vote on PJM’s proposal with a narrowed version of the PJM/IMM amendment that would allow companies with multiple generating assets to replace capacity within their portfolios without paying the charge.
FirstEnergy and Pepco Holdings argued that the amendment was unduly harsh without the exemption. Pepco’s Gloria Godson called it “micromanagement” and “overkill.”
Mystery Number
Mike Borgatti, of Gabel Associates, said the amendment would make it risky to make bilateral trades because the penalty would be a “mystery number” not determined until the IA. Consultant Tom Rutigliano said it would also create unintended consequences for energy efficiency.
Market Monitor Joseph Bowring countered that the PJM proposal “would be meaningless” without the amendment because participants could avoid penalties by buying replacement capacity through bilateral trades rather than incremental auctions.
Even with the exemption, the proposal garnered only 35% support.
In one last attempt, members voted on the PJM proposal and the original amendment, without the exemption introduced by J.P. Morgan.
Ken Jennings, of Duke, said he opposed the exemption. “Because your [forced outage rate] got worse, you shouldn’t be able to profit from that,” he said.
That motion fared worse still, with only 31%.
Next Steps
ODEC’s Ed Tatum said that PJM should attempt to draft language identifying conduct that would justify submitting a participant to FERC enforcement. “Go after the people that we really think are doing the wrong thing,” he said.
“With the changes we’ve seen, I don’t think we need to make any [additional] changes,” Tatum said, referring to limits on the volumes of imports and demand response that will clear in future capacity auctions.
Bowring said Tatum’s proposal was unworkable. “I strongly prefer clear rules rather than after-the-fact enforcement actions,” he said. “Referrals to FERC take a very, very long time. If you have 20 or 30 participants engaging in this kind of behavior it’s not very efficient.”
PJM Executive Vice President for Markets Andy Ott agreed, saying PJM wanted to reinforce the physical nature of capacity commitments. “We don’t want to have to judge intent,” Ott said. “We certainly will be looking at ways to strengthen the physical language.”
The PJM Board voted Thursday to submit the RTO’s proposal, including the amendment to close the bilateral trade loophole, for FERC approval. A filing may come as soon as this week.
In a highly unusual move, members Thursday balked at endorsing proposed manual changes governing when Economic demand response qualifies for payment.
The changes to Manual 11 received only 57% in a sector-weighted vote of the Markets and Reliability Committee, with no End Use Customers and less than half of Other Suppliers voting in support.
Most Generation Owners and Transmission Owners voted in support of the changes, which would have specified that demand reductions are eligible for compensation only when they “are not implemented as part of normal operations.”
Ineligible for compensation would be load reductions “that would have occurred without PJM dispatch, or that would have occurred absent PJM energy market compensation.”
No Policy Change
PJM’s Pete Langbein said the manual changes were intended to explain the RTO’s existing interpretation of FERC Order 745. “This is not changing our operative practice,” he said.
Susan Bruce, counsel for the PJM Industrial Customer Coalition, said that additional clarification was needed on PJM’s interpretation of the order, which requires PJM to compensate Economic DR at full Locational Marginal Price when it provides a “net benefit” to the system.
“We have some industrial customers who are really struggling with how to ensure they’re compliant,” she said. “One person’s view of normal operations might be different than another’s.”
Contradicts Order 745
John Webster, of Icetec Energy Services, said the new language would give PJM too much latitude in determining the motives of DR participants and when they should be compensated. He said any revisions should be made through Tariff changes and subject to full stakeholder review.
“From our perspective, it’s contradictory to Order 745,” he said. “There’s no process in place that would allow for that [after-the-fact] analysis.”
Questioned after the meeting, PJM Executive Vice President for Operations Mike Kormos and MRC Secretary Dave Anders said they weren’t sure whether the RTO would use its discretion to add the revisions to the Manual without stakeholder endorsement, or where the issue would go from here.
Manual Changes Approved
Changes to three other manuals won stakeholder endorsements with little discussion:
Manual 7: PJM Protection Standards — These revisions are intended to align the manual with the PJM Relay Subcommittee’s Protective Relaying Philosophy and Design Guidelines. They include changes to section 7 (Line Protection) and section 8 (Substation Transformer Protection).
Manual 40: Training and Certification Requirements — These changes, part of the annual update to meet NERC standards, revise data retention requirements and clarify continued training requirements for transmission operators and initial training requirements for new entities.
Manual 21: Rules and Procedures for Determination of Generating Capability — These changes strengthen the rules for summer verification testing of steam generation units and provide a transition mechanism for those who haven’t been providing appropriate testing results to PJM. (See Transition Period OKd for Seasonal Verification Rules.)
University Hosts Initiative Promoting Offshore Wind
The University of Delaware has launched a “Special Initiative” on offshore wind, which it hopes will serve as
catalyst to “add momentum to a promising industry that is at a critical juncture.” Supported by the Rockefeller Brothers Fund, the initiative plans to draw together information about technology, financing and collaboration opportunities, serving as a nexus for partnerships among private sectors, non-governmental organizations and government. It is housed at UD’s College of Earth, Ocean and Environment.
Commonwealth Edison is accelerating its deployment of advanced meters, with plans to switch all 4 million of its meters by 2018, three years ahead of schedule. Chicago’s South Side started getting meters last week and would be completely outfitted by the end of 2015, assuming the Illinois Commerce Committee approves the schedule. The entire city would be finished by the end of 2017.
State Considers Tougher Rules for Coal Ash Storage
The Illinois Pollution Control Board is considering stricter rules for coal ash storage and monitoring, initially focusing on regular monitoring and reports on groundwater supplies. If contamination occurred, companies would either take corrective action or close the site. The board held its first hearing on the matter Feb. 26 at the state Environmental Protection Agency, hearing from citizens worried about the numerous coal plant sites near them and industry representatives concerned about costs.
House Version of S.B. 340 Kills Efficiency Program
The House of Representatives approved a bill that would eliminate energy efficiency mandates for utilities and dismantle Energizing Indiana, a two-year-old energy efficiency program for homes, businesses and industrial users.
The House was acting on a measure, Senate Bill 340, already passed by the Senate, which exempts large industrials from paying the program’s fees. In the House, however, an amendment broadened the bill to shut down the program altogether. The amended measure was to be returned to the Senate, where its author said he would determine whether to accept the House changes or go back to his original bill.
Fort Wayne International Airport, with Telamon Corp., is exploring the possibility of a solar park on two airport-owned sites. Telamon, which has a 12.5-MW solar farm operating at Indianapolis International Airport, is determining the viability of the Fort Wayne site. If built, the facility would feed power into the system of Indiana Michigan Power, a unit of American Electric Power.
ITC Holdings sees competition in the transmission business growing as regulated utilities demonstrate more enthusiasm for building transmission. The independent transmission company remains open to merger and acquisition possibilities, despite the ultimate failure of its deal to buy Entergy’s transmission system.
Jersey Central Power & Light would be able to recover nearly all the costs it incurred restoring its system after Hurricane Sandy and other storms in 2011 and 2012 under a tentative agreement with regulatory staff and the Division of Rate Counsel. The $736 million settlement — a slight reduction from the $744 million in costs claimed — has to get Board of Public Utilities approval. The company, a unit of FirstEnergy, still faces a possible hit, however, in a base-rate case at the BPU, where staff and Division of Rate Counsel want rates cut by more than $200 million.
‘Energy Strong’ Still Tough As Hearings Begin at BPU
No signs of rapprochement appeared as hearings began last week in the Public Service Electric & Gas “Energy Strong” case at the Board of Public Utilities. The company’s proposal to spend $2.6 billion over five years to harden its gas and power systems against storms continued to draw criticism for the size of the expenditure and the mechanism for cost recovery from customers. Since its initial proposal, PSE&G has reduced its requested amount to $1.9 billion, sources have said.
Florida-based NTE Energy would aim to sell power to Duke Energy and electric cooperatives from a 480-MW natural gas combined-cycle plant it wants to build in the southwestern part of the state. The project could be the company’s first wholesale market venture, depending on the timing of development. NTE is also working on projects in Ohio and Texas. The plant, Kings Mountain Energy Center in Cleveland County, would be able to tap into a Transco pipeline and power lines at the site.
The Department of Environment and Natural Resources cited Duke Energy for violations of environmental laws in connection with the spill of coal ash from the shuttered Dan River coal plant. The company could face fines up to $25,000 a day for each violation. More information will emerge after the state completes investigating the incident. Also last week, Gov. Pat McCrory told Duke CEO Lynn Good that coal ash disposal facilities should be moved away from drinking water sources.
Gov. John Kasich chose former state Rep. Thomas Johnson to succeed Todd Snitchler as chairman of the Public Utilities Commission when Snitchler leaves April 10. Johnson, whose term will end in April 2019, was a member of the General Assembly for 22 years and now heads a consulting firm, Ohio Strategic Advocacy Partners.
After leaving the Assembly, he was director of the state Office of Budget and Management for seven years and then joined Ohio State University, where he taught public budgeting and in 2011 became assistant vice president of financial services. Johnson’s nomination requires Senate confirmation.
NRG Pipeline Gets PUC Nod; Will Serve Avon Lake plant
The Public Utilities Commission approved NRG Ohio Pipeline as a utility, enabling the company to build a natural gas pipeline to affiliate NRG Energy’s Avon Lake plant, which will convert from coal to gas. The 24- or 30-inch pipe would take gas from a Dominion East Ohio or a Columbia Gas of Ohio line about 20 miles south of Avon Lake.
The project requires the Ohio Power Siting Board’s approval for an as-yet undetermined pipeline route. NRG hopes to start building the line in the spring or summer of 2015 and to complete conversion of the plant in May 2016.
Attorney General Takes On Cold-Spell Price Spike Issue
Attorney General Kathleen Kane
Attorney General Kathleen Kane is investigating reports of extreme electricity bill spikes for customers on variable-rate plans. The Public Utility Commission was already examining its rules for variable-rate sellers, but last week Kane invited ratepayers to file complaints for investigation.
Kane noted that price gouging — increasing prices above any increased costs — during a state of emergency is prohibited in Pennsylvania. Governor Corbett declared a state of emergency on Feb. 5.
FirstEnergy utilities in Pennsylvania plan about $600 million of investment in system improvements this year, including significant tree trimming and maintenance. In Pennsylvania Electric territory, the company will spend $228 million, $66 million more than last year. The figure includes $49 million for transmission-related projects built and owned by affiliate Trans-Allegheny Interstate Line.
West Penn Power will invest $160 million, including $23 million for TrAIL work. The spending is $41 million more than last year.
Metropolitan Edison plans to spend $140 million, $55 million more than last year, including $30 million for TrAIL projects.
In the Penn Power service area, the company will spend $71 million, $34 million more than last year. $37 million is for TrAIL work and $14 million is tagged for smart meters.
CMU Study: Put Renewables Where Benefits are Greatest
Planners should place solar and wind power generators where they can deliver the most benefits — like Pittsburgh, for example — and not necessarily where the resources are greatest, a Carnegie Mellon University study concludes. “What makes solar benefits in Pittsburgh larger than in other locations is that we would be mostly displacing electricity generated by coal, which has a large amount of air pollutant emissions — and associated health and environmental consequences,” said Inez Lima Azevedo at CMU’s Center for Climate and Energy Decision Making.
A bill allowing Dominion Power to write off most of what it has spent studying whether to build a third unit at the North Anna nuclear station passed the state Senate last week and went to Gov. Terry McAuliffe’s desk. The state attorney general had opposed it, as had environmentalists and Dominion’s largest customers.
As of last week the governor had not expressed his intentions for the bill. The measure allows Dominion to deduct about $400 million of spending from its profits. It would probably avoid the possibility of a state-ordered rate refund in the future.
Beech Ridge Energy has asked for approval to install battery storage systems at its wind farm in Nicholas and Greenbrier counties. The Invenergy company asked the Public Service Commission to waive the need for an amendment to its existing site certification in order to add the storage. Beech Ridge now has 100 MW operating, and says that the storage, plus a second set of turbines, would not exceed 186 MW. The storage device would have a nominal output of up to 32.4 MW.
FirstEnergy utilities that serve West Virginia plan to spend more than $250 million this year to improve their systems and trim and maintain trees. Mon Power will invest about $110 million, $32 million more than last year, in projects that include raising capacity on the Collins Ferry-Osage 138-kV line and supporting the expanding Marcellus Shale gas industry operations.
Potomac Edison, which serves customers in western Maryland and West Virginia, plans to spend about $143 million on a variety of projects, $80 million more than last year, including $42 million for transmission-related work on projects built and owned by FirstEnergy affiliate Trans-Allegheny Interstate Line. The utility will also be extending service to fast-growing areas of both states.
AES Corp. announced last week that it is attempting to sell DPL Inc.’s generation fleet rather than spinning it off into an unregulated subsidiary.
The Public Utilities Commission of Ohio has ordered AES to separate DPL’s generation into an unregulated subsidiary by mid-2017, but Chief Financial Officer Tom O’Flynn told analysts Wednesday that the company may sell instead.
“We’ll explore all potential options to optimize the solution, and we recently began to evaluate the sale of DPL generation assets to an unaffiliated third-party…” O’Flynn said during an earnings call. “Obviously we can’t comment much as we’re in the very early stage of this process.”
$307 Million Charge
AES bought DPL, parent of Dayton Power and Light Co., in November 2011 for $3.5 billion in cash. The company said it wanted to increase its presence in the Midwest, where it already owned Indianapolis Power & Light Co.
Although the purchase price was a modest 9% premium to DPL’s stock price, the company now concedes the deal isn’t looking so smart. “To date, we have not realized the benefits that we anticipated at the time of acquisition,” AES said in its 10-K, filed last week.
The company recorded a $307 million charge ($0.41/share) for goodwill impairment at DPL in the fourth quarter of 2013, citing “lower than expected PJM cleared capacity prices for 2016/2017, lower expectations of future PJM capacity prices and lower projected energy margins.”
Retail Competition
(Source: AES)
Higher maintenance costs from planned outages and switching by retail customers also hurt DPL’s results for the year.
In 2013, about 42% of customers, representing two-thirds of the energy usage within DP&L’s service area, purchased power from competitive suppliers.
DP&L has been the default power supplier to those not shopping. But beginning this year, it will lose its monopoly on these Standard Service Offer customers. Ten percent of the SSO load will be sourced through competitive bids in 2014, rising to 100% in 2017.
DPL Energy Resources Inc., DPL’s competitive retail marketer, has more than 308,000 retail customers in Ohio and Illinois, including 130,000 of DP&L’s 515,000 distribution customers.
2013 Results
AES Corp.’s foreign businesses drove most of the company’s earnings news last week, with an unprecedented drought and bad currency exchange rates in Latin America to blame for much of its downturn in fortunes.
Its fourth quarter per-share earnings were 29 cents, compared to 31 cents in the previous year. Its year-end results were $1.29 per share, compared to $1.21 for 2012.
Like many other utilities, AES said it is going to concentrate on regulated business, and it is looking to sell generation assets. The company, which derives 75% of its earnings outside the U.S., announced late last year that it was shedding assets in Cameroon, India and Poland.
Generation Sale
Hutchings Station (Source: DPL)
AES will find a crowded field if it moves forward with a sale of DPL’s 3,453 MW of generation. Ameren Corp. sold five coal-fired merchant plants in Illinois to Dynegy Inc. last year.
Last month, Duke Energy announced its intention to sell its shares in 13 plants in the Midwest, including seven plants co-owned with DPL.
Dayton Power and Light owns 2,897 MW of capacity, most of it coal-fired. DPL subsidiary DPL Energy LLC owns 556 MW of peaking capacity in Ohio and Indiana.
A White House official dampened expectations that the Environmental Protection Agency will issue a greenhouse gas rule for existing power plants by the June 1 date set by the president last summer. Heather Zichal, deputy assistant secretary to the president for energy and climate change, said it would be premature to issue a rule for existing plants while still reviewing two million comments filed on the proposed GHG rule for new power plants, which was published in January, later than expected. The EPA extended the March 10 public comment deadline to May 9 at Congress’ request.
U.S. Supreme Court West Facade (Source: Wikimedia Commons)
The Supreme Court declined to hear questions raised by some states and utilities about cost allocation for regional power lines. Utilities and regulators in Illinois and Michigan had challenged an appeals court ruling upholding the Midcontinent Independent System Operator’s broad cost allocation design for “multi-value projects,” but the high court declined to take up the case. MISO’s cost-sharing regime is thus left in place.
The coal ash spill at Duke Energy’s shuttered Dan River plant in North Carolina has increased pressure on the federal government to issue strong disposal regulations. The power industry believes the Environmental Protection Agency will not regulate ash as a hazardous waste, and will leave regulatory choices to states, but environmental groups continue to argue for a hazardous designation and a strong federal role.
NREL Studies State Roles In Solar Market Development
A new National Renewable Energy Laboratory report concludes that the effectiveness of state solar policies is influenced by demographic factors such as median household income, solar resource availability, electricity prices, and community interest in renewables. NREL said the study provides “insight into the policy scope and quality that is needed to spur solar PV markets.”
The report includes case studies on three PJM states, citing Maryland’s “comprehensive policy portfolio with equal emphasis on all policy types;” North Carolina’s “strong interest in clean energy-related policy,” and Delaware’s experience, which it said “illustrates how targeted market preparation and creation policies can effectively stimulate markets.”
Shaheen-Portman Re-filed; Changes Aimed at Passage
An energy efficiency bill that has been stalled for months was reintroduced last week with some new provisions that could pave the way for passage, though timing of Senate floor action is still uncertain. The Energy Savings and Industrial Competitiveness Act, introduced again by Sens. Jeanne Shaheen (D-N.H.) and Rob Portman (R-Ohio), would strengthen model-building codes, create a building efficiency financing program, provide incentives for energy-efficient industrial motors, and more. Numerous new provisions, which brought more senators onto the measure, include repeal of a 2007 law requirement that new federal buildings use no fossil fuel energy sources.
Detroit-area Democratic Rep. John Dingell announced he would retire from the House of Representatives after a record 59 years. His wife, Debbie Dingell, is among those reportedly planning to run for his seat.
In his tenure, Dingell presided over the Energy and Commerce Committee’s passage of major energy and environmental legislation, including the Clean Air Act Amendments of 1990, which established the Acid Rain Program. He also was involved with the Energy Policy Act of 1992, which established incentives for renewable energy and conservation and created a full-fledged independent power business by allowing “exempt wholesale generators.”
He also led the committee during writing of the American Clean Energy and Security Act of 2009, referred to as the Waxman-Markey bill, which passed the House but died in the Senate. It would have created a greenhouse gas cap-and-trade program. Rep. Henry Waxman (D-Calif.) has also announced his retirement, placing Democratic leadership of the energy committee in contention.
Stakeholders last week agreed to develop technical standards for “smart” inverters that can allow solar PV and other renewables to provide reactive power.
The Markets and Reliability Committee approved a problem statement/issue charge directing the Planning Committee to develop standards and accompanying rule changes.
The increasing penetration of solar PV and other asynchronous generation resources, combined with the retirement of traditional generation, has made managing voltage more difficult in some regions. Smart or enhanced inverters allow such resources to provide reactive power support and increase their abilities to remain operating during frequency swings and low voltage. (See `Smart’ Inverters May Give Solar Reactive Capability.)
The new standards would apply to new sources of renewable generation, while allowing existing units to maintain the status quo, said PJM’s Frank Koza.
Many smart inverters are already installed on existing PV solar generators, but their enhanced capabilities have been disabled due to current conservative IEEE standards, which force generators to trip offline quickly to avoid islanding. Smart inverters are already being used successfully in Europe.
“These (regulations) could apply to any type of generation seeking interconnection,” said Koza, who noted that smart inverters could aid transmission and distribution projects, too.
Several stakeholders noted that the distribution system — where many inverters will be installed — is beyond the purview of PJM and urged the RTO to work with state regulators to determine jurisdictional boundaries and policy implications. This was added as a friendly amendment to the proposal, which passed without opposition.
PJM hopes to complete work on the issue in time for an August FERC filing.
