FERC Filings
COMMENTS OF THE ELECTRIC POWER SUPPLY ASSOCIATION ON ADMINISTRATIVE LAW JUDGE MEDIATOR’S REPORT TO THE COMMISSION
General Comments and Need for Commission Action
EPSA welcomes the recent action taken by the Commission. If successful, the effort to combine existing entities into one RTO would lead to more efficient, robust and reliable power markets in the Northeast. As was discussed during the June 19th Technical Conference, RTOs with standardized market and operational rules over broader geographic areas will alleviate seams problems that obstruct interregional coordination required under Function 8 of Order No. 2000. Also, EPSA strongly supports the Commission’s renewed effort to expedite the transition to competitive markets, particularly the focus and guidance to be provided through the upcoming Section 206 rulemaking RTO market design and structure.
In its Mediation Order, the Commission concluded that mediated settlement discussions were necessary in order to “successfully address seams issues among the three existing Northeast ISOs and establish efficient markets in the Northeast.” The Commission directed Judge Young to file a report following the mediation, including “an outline of the proposal to create a single Northeastern RTO, milestones for the completion of intermediate steps, and a deadline for submitting a joint proposal.”
EPSA applauds the Commission’s decision to become more proactive and its renewed commitment to the objectives of Order No. 2000. Many parties devoted substantial time and effort to the mediation sessions that Judge Young conducted; however, at the conclusion of this first stage much remains to be done. Essentially, the mediation produced an inventory of the features and characteristics of each of the existing ISOs, with differences identified and various “options” presented. While short of the ultimate objectives envisioned in the Mediation Order, this work could provide the basis for more productive, future actions. For this to occur, however, more specific FERC guidance and direction is neccesary.
Judge Young explained in his report: “I also purposefully confined the mediation to the procedural task of formulating a ‘blueprint’ for a subsequent ‘going-forward’ process of RTO development and implementation, an essential element of which will be stakeholder resolution of substantive issues in accordance with the milestones established in the Business Plan.” While the exchange of views during the formulation of the ‘blueprint’ was helpful, it resulted in a collection of “designated deviations” from the PJM platform, or so-called “best practices” which, in the view of the NYISO and ISO-New England, must somehow be incorporated into the PJM platform.
Judge Young himself observes that there is no consensus on these “deviations” from the PJM platform, and that “many difficult substantive issues must be resolved among the stakeholders in the ‘going-forward’ process.” In his report, he recommends that the Commission clarify the “precise meanings and parameters” of the PJM platform, and to what extent it is necessary to supplement that platform with the NYISO’s and ISO-New England’s “best practice” proposals.
EPSA agrees, and believes that Judge Young’s statements are correct. With this first stage completed, the future of the “Business Plan,” and prospects for its success, are now in the Commission’s hands. Accordingly, EPSA urges the Commission to consider the great deal of time and effort devoted to the mediation when assessing Judge Young’s recommendation. It is clear that the parties have gotten as far as they can and, without additional guidance from the Commission, opportunities for further delays will remain available for those who do not share the commitment for expedited action.