FERC Filings
MOTION OF EPSA FOR LEAVE TO INTERVENE OUT OF TIME, COMMONWEALTH EDISON COMPANY
III.
While not apparent from the September 22nd Notice, Com Ed appears to be using this Section 205 filing as an opportunity to refunctionalize as much as 40 percent of its current transmission assets to distribution, effectively removing those facilities from its OATT and the Commission's jurisdiction. In its transmittal letter, Com Ed asks the Commission to "concur" in a July 28, 1999 determination made by the Illinois Commerce Commission (ICC) to recategorize transmission facilities as distribution.
It is not clear in this proceeding whether the refunctionalized facilities are, in fact, used to provide service under Com Ed's OATT. However, EPSA is very troubled by the recent trend of jurisdictional utilities to "refunctionalize" existing transmission assets to distribution status. Competitive power suppliers require open access to all facilities used for transmitting electric energy in interstate commerce. Such access is presently provided through the open-access non-discriminatory transmission tariffs of Com Ed and other public utilities. The Commission's jurisdiction over interstate transmission facilities must be as broad as possible in order to achieve the goals set by the Commission in Order Nos. 888 and 889, as well as the pending Notice of Proposed Rulemaking (NOPR) on Regional Transmission Organizations (RTOs). If public utilities are allowed to reclassify transmission facilities as distribution without adequate justification, those assets will be removed from the Commission's jurisdiction and from control by any RTO, effectively undermining efforts to assure seamless access to regional competitive markets. Thus, the Commission must be vigilant to ensure that facilities used for transmitting energy in interstate commerce are not removed from the Commission's jurisdiction.
The potential discriminatory effects of refunctionalization are extremely troubling. Not only could such action increase the delivered cost of energy and limit transmission access, but important safeguards contained in Order No. 888, with respect to OASIS posting, available transmission capacity calculation and capacity benefit margin treatment, will be lost. The implications for existing Commission policy, and the RTO rulemaking, are worrisome. The benefits of promoting efficient regional markets will be largely dissipated if large amounts of the interstate transmission system are removed from the Commission's jurisdiction and not made available under the pro forma tariff. In short, unfettered refunctionalization risks a return to the patchwork of closed and open transmission systems that predated the issuance of Order No. 888
The deference to state commissions envisioned by Order No. 888 cannot result in a gutting of the Commission's seven-part test. That deference is only appropriate when the state regulatory determination is "consistent with the principles" established in Order No. 888. It is impossible to tell from the Com Ed filing whether this requirement was met. It is incumbent upon this Commission to carefully consider the issues raised by Com Ed's filing, to carefully review the ICC's application of the seven-part test, and to insure that facilities integral to providing interstate service remain subject to the Commission's jurisdiction. At a minimum, the Commission should defer action on Com Ed's proposal until the issues can be fully understood. Com Ed should be required to fully justify its request for refunctionalization so that the Commission can assess the reasonableness of the request and should not merely "rubber stamp" the ICC decision at Com Ed's request.