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EPSA Supports Clear National Performance Metrics

"While the metrics should be diverse and measure various elements of the ISO/RTO markets, EPSA cautions against any undue focus on price as a determinative metric. Prices are only part of the market, and differences from one region to the next and within regions reflect many complex variables outside of the realm of ISO/RTO operations or control."

WASHINGTON, D.C. - On Friday, the Electric Power Supply Association (EPSA) filed comments with the Federal Energy Regulatory Commission (FERC) supporting the development of metrics to measure the performance of independent system operators (ISOs) and regional transmission organizations (RTOs). EPSA's comments suggested refinements to proposed metrics to ensure that ISO/RTO performance is being measured in a useful and meaningful manner. FERC had been urged to develop clear metrics on ISO/RTO performance in a September 2008 Government Accountability Office (GAO) report.

EPSA recommended consideration of ISO/RTO metrics such as how often market prices are flagged, reset or settled by the system operator, the efficiency of generator dispatch, as well as interim metrics on reliability which should consider NERC reliability metrics, which are currently under development, where they may be complementary.

EPSA noted that "While the metrics should be diverse and measure various elements of the ISO/RTO markets, EPSA cautions against any undue focus on price as a determinative metric. Prices are only part of the market, and differences from one region to the next and within regions reflect many complex variables outside of the realm of ISO/RTO operations or control. These include but are not limited to federal, state or regional policy priorities driving particular environmental rules, the available generation resource mix in the ISO/RTO's footprint, and differing peak needs that vary by region."

The GAO report had also encouraged FERC to measure the benefits of ISO/RTOs versus not having them. EPSA strongly stressed the importance of developing such metrics for non-ISO/RTO regions of the country, which FERC has stated in its strategic plan it will do in 2011.

EPSA's comments state that "...similar metrics to assess the performance of the non-ISO/RTO regions are necessary to establish and measure those markets in a similar manner, both to assess bilateral regions in their own right but also to put the performance of RTO and non-RTO regions in context. This effort is of particular importance in light of the utter lack of meaningful transparency of these non ISO/RTO regions in comparison to the ISOs/RTOs." The comments went on to commend FERC's intention of developing such metrics next year and "urges that this effort be accomplished expeditiously, and looks forward to working with the Commission in the development of useful performance metrics for those non-ISO/RTO regions."

CONTACT: JOHN SHELK
(202) 349-0154or 703-472-8660

EPSA is the national trade association representing competitive power suppliers, including generators and marketers. These suppliers, who account for nearly 40 percent of the installed generating capacity in the United States, provide reliable and competitively priced electricity from environmentally responsible facilities serving global power markets. EPSA seeks to bring the benefits of competition to all power customers.