FERC Filings
REPLY COMMENTS ON THE NOTICE OF PROPOSED RULEMAKING ON REMEDYING UNDUE DISCRIMINATION THROUGH OPEN ACCESS TRANSMISSION SERVICE AND STANDARD ELECTRICITY MARKET DESIGN
EXECUTIVE SUMMARY
First, the Commission should not allow regional variation to compromise the objectives described in the Notice of Proposed Rulemaking (NOPR) on Standard Market Design (SMD). While many argue for regional variation in adoption and implementation of SMD, the Commission should not lose sight of the fact that lack of standardization has caused the very problems this NOPR is largely designed to remedy. Certainly, some aspects of the NOPR can be modified to address specific regional need; however, Competitive Suppliers recommend a key list of items which must be standardized for this rulemaking to accomplish its intended goals.
Second, in various comments, opponents of the Commission’s initiatives to create fully functioning wholesale electric power markets raise a blizzard of legal arguments against the Commission’s NOPR. After careful review, none are persuasive.
To achieve the goal of a competitive wholesale electricity market, first set out by the Commission in Order No. 888, and then followed up with Order No. 2000 and this NOPR, the Commission must complete the job of separating the transmission business from the generation market. As each of those major Rules, and again this NOPR, document, control of the transmission system allows integrated utilities to favor their own generation, perpetuating the undue discrimination documented by the Commission in each of these proceedings. Only when Independent Transmission Providers (ITP) and a unified transmission tariff are in place and functional will the Commission’s goal of a robust competitive wholesale market, capable of providing benefits to all electricity consumers, be realized.
Specifically, as shown below:
- The Commission has a more than adequate record upon which to act;
- The Commission has more than adequate authority under Section 206 of the Federal Power Act (FPA) to remedy undue discrimination and undue preferences in the provision of interstate transmission services;
- The Commission has the authority to exercise jurisdiction over the transmission component of bundled retail transmission services;
- The Commission can implement a resource adequacy program despite the limits on its jurisdiction over electric power generation as set forth in FPA § 201(b)(1); and
- The Commission can require the participation of a transmission owner in an ITP if it does not voluntarily join a Regional Transmission Organization (RTO).
Third and finally, Competitive Suppliers are concerned that the Commission’s reciprocity proposal falls short of reaching comparable service by failing to require nonpublic utilities to comply with all aspects of the SMD.
In sum, there is no impediment to the Commission issuing a final rule on SMD. Further, the Commission should do so with dispatch to complete the transition to fully functioning wholesale electric power markets.