FERC Filings
MOTION OF EPSA FOR LEAVE TO INTERVENE AND PROTEST, ENTERGY SERVICES, INC.
III.
The Commission should reject Energy's proposal, which is designed not to improve reliability, as Entergy posits, but to frustrate competition. Requiring PTP customers to provide the detailed source and sink data proposed by Entergy will further undermine the ability of new market entrants to compete effectively in the wholesale market, providing additional competitive advantage to Entergy's own resources. If approved, Entergy's proposal will significantly undermine the development of the very competitive markets Order Nos. 888 and 2000 are supposed to foster.
Most significantly, Attachment M, which is clearly not "consistent with or superior to" to pro forma tariff, will further exaggerate the lack of comparability between PTP and network service. Under Attachment M, PTP customers will be required to reserve and schedule transmission from a generator source to a customer sink well in advance of the actual transaction. Most transactions, however, are not known with certainty that far in advance. In order to obtain transmission service, PTP customers will reserve and schedule receipt and delivery service without knowing those specific points are the ones they will need in real time when they match customers and resources.
When specific points of receipt (PORs) and points of delivery (PODs) needed to match actual customer demand in real time are actually known, PTP customers may end up having to designate and use secondary PORs and PODs. This, in turn, relegates transmission service to the lowest possible priority, vastly increasing the likelihood that PTP transactions will be curtailed. Network service will not be subject to similar constraints, thus making it a preferable service for customers.
Requiring reservations and schedules to include specific, inflexible information adversely impacts the market in other ways. Since both source and sink must be designated at specific single generator and load buses, in advance, the ability to develop trading hubs is effectively eliminated. For markets to develop liquidity and depth, transmission market participants need access to many buyers and many sellers. Requiring that a specific bus bar be provided far in advance of the actual transmission transaction for generators and loads severely limits the number of potential suppliers and customers at those locations. Instead of the array of customers and suppliers available at a control area interface, such as "Into Entergy," PTP customers will be needlessly limited to buying from or selling to only those entities associated with the specific locations referenced.
In addition, designating in advance specific source and sink locations will frustrate the ability of market participants to respond in real time to market signals. With a control area designation, marketers can allocate resources to customers who most value those resources. With a bus bar source and sink designation, this becomes difficult if not impossible.
Entergy's position that generation-only and load-only control areas "don't count" under Attachment M should also be rejected. NERC's Control Area Criteria Task Force has been focused on eliminating the competitive advantages<sup>2</sup> associated with being a control area. The Task Force has noted the "market advantage should be removed from the reliability functions." Entergy's proposal goes in the opposite direction. By defining "valid" control areas as those that have both generation and load, Entergy gives a clear advantage to vertically integrated utilities - like itself - over other market participants. NERC's Board of Trustees has specifically recognized generation-only control areas precisely to avoid the type of competitive advantage Entergy now wants for itself.
Finally, Entergy's claim that Attachment M is needed to support reliability on its system is misplaced. Entergy argues that it needs the level of detail required in Attachment M in order to manage the flow of energy on its system.<sup>3</sup> In fact, only a very small percentage of the energy flowing on Entergy's system occurs under PTP service. Nationally, only about 20 percent of all energy flows under the Commission's open access tariff requirements. In some regions, such as the Southwest Power Pool (SPP), this number is significantly lower.<sup>4</sup> Of this percentage, only some of the power flows under PTP service, since network service for Entergy's own customers makes up a significant part of this total. Thus, revealing bus bar source and sink data for PTP customers will reveal information about only a very small percentage of the energy flowing on Entergy's system. Modeling such a small percentage of the power flows, no matter how sophisticated and precise, will provide little or no useful information to Entergy.
2. Advantages of control area status include the ability to "park" transactions, which allows control area operators to move power into the market at the time of highest demand without the tagging and notice requirements imposed on other transmission customers, and the ability to circumvent the imbalance penalties imposed on other generators.
3. The Commission should note that the modeling used in NERC's Interchange Distribution Calculator, which identifies transactions that should be curtailed under NERC's TLR policies, uses source and sink controla areas, not buses.
4. According to the Electric World Directory of Electric Utilities, utility sales in SPP totaled 163 million MWhs in 1997. In 1999, according to SPP, 12 million MWhs were moved under the OATT in the SPP region. Conservatively (since utility sales increased in 1999), less than 8 percent of the MWhs sold in SPP occurred under the tariff.