FERC Filings
MOTION TO INTERVENE AND PROTEST OF ELECTRIC POWER SUPPLY ASSOCIATION-Desert STAR, Inc.-Docket No. RT01-44-000
D. The DSTAR Proposal Would Provide Undue and Unwarranted Preferential Treatment to Vertically Integrated Market Participants
DSTAR and the stakeholders have not yet resolved the issue of how DSTAR and the existing Control Area Operators would implement dispatch of the
DSTAR grid. Yet under both the DSTAR proposal and the jurisdictional utilities’ proposal, the
Participating Transmission Owners - many of whom will remain vertically integrated and are therefore market participants who are competing with other DSTAR customers - would receive preferential access to grid data, DSTAR operating plans, the status and operating points of their competitors’ generating units, economic information regarding their competitors’ generating units, and dispatch authority over their competitors’ generating units.
Under both of the DSTAR proposals, vertically integrated market participants would, by virtue of being Participating TOs, receive preferential access to commercially-significant grid and market information. Vertically integrated market participants would also receive preferential access to real-time grid and market information by virtue of playing ongoing roles in operating facilities that are important to the marketplace. The proposals would prevent the achievement of one of the primary goals of Order No. 2000: to ensure that market participants are confident that transmission access and operations are managed non-discriminatorily.
Despite this preferential access to commercially valuable information, vertically integrated market participants would not be required to structurally separate their transmission business activities from those of their retail energy merchants, would not be required to act in the interest of DSTAR rather than their own corporate interests, nor would they be required to comply with any Code of Conduct that would prohibit their retail merchants from receiving preferential access to commercially significant information.
It is essential that control area operation be consolidated under the authority of DSTAR. Yet even then, it is necessary that the DSTAR Tariff require that any transmission operation functions (i.e., functions related to the dispatch of resources or operation of the grid) that are retained by PTOs may only be retained by the PTO if the PTO has structurally unbundled its transmission operations from the remainder of its business functions.
The DSTAR TCA should require that any grid-related functions that are retained by a PTO (including system monitoring and emergency control), through which the PTO has access to grid information and/or market information, be subject to the following:
None of the PTO’s merchant functions (including retail energy services procurement) may be located in the same physical facility as the transmission and distribution wires functions, to prevent superior or earlier access to information; and
The PTO must commit to a Code of Conduct, to be incorporated in the Tariff, that (i) obligates the PTO, when performing its “wires” obligations, to act as the RTO’s agent and in the interest of DSTAR, and (ii) obligates the PTO to not exchange any information with its affiliated merchant functions.
Finally, the Tariff should commit DSTAR to immediately publish on its website all information that the RTO conveys to, or receives from, the PTO in the course of the PTO’s duties as an agent for the RTO.