Did You Know

Midwest ISO Files Energy Markets Tariff with FERC

The Midwest Independent Transmission System Operator Inc. (MISO) recently filed its Energy Markets Tariff with the Federal Energy Regulatory Commission (FERC) after months of discussions and negotiations with its stakeholders.

The filing replaces an earlier energy markets tariff filed last July and includes the rates, terms and conditions needed to implement a platform with centralized dispatch of generation resources.

The market design encompasses the commercially proven, security-constrained, economic dispatch platform, which is integrated with Day-Ahead and Real-Time Energy Markets. These markets allow wholesale participants to manage their risks properly and the MISO personnel to operate reliably in real time. The market design also includes locational marginal pricing and financial transmission rights to manage congestion reliably and efficiently.

The tariff is consistent with FERC’s directive in Order No. 2000, which, among other things, requires regional transmission organizations to provide real-time energy imbalance service and a market-based mechanism for congestion management.

Dec. 1, 2004, is the date MISO has requested to begin its energy markets. In a press release on the new energy markets tariff, MISO President and CEO Jim Torgerson said, “This filing, upon acceptance by the Commission, will implement a market that will improve congestion management on the grid and produce consumer savings through the system-wide centralized dispatch of generation throughout the region.”

Torgerson commended MISO members, the Organization of MISO States (OMS) and other entities for their help resolving various issues and acknowledged that the OMS “will continue to be an important element in this process.” OMS is a new committee of state public utility commissioners in the Midwest, who have been working with MISO staff for nearly a year.

Some of the issues addressed include control area functions, which is a critical area of concern, according to the U.S. – Canada Task Force’s final report on the Aug. 14, 2003, blackout. MISO’s collaboration with its stakeholders has resulted in a redefinition of the roles and responsibilities of MISO and its stakeholders in accordance with the North American Electric Reliability Council’s Functional Model.

“Under the proposed separation of functions, the Midwest ISO will be responsible for operating the Day-Ahead and Real-Time Energy Markets to arrive at an optimal dispatch solution for all resources within the region. This will enable the Midwest ISO to ensure that all load requirements in the region are met reliably and efficiently. Local Control Area Operators will continue to be responsible for many of the traditional control area operations, but will operate their systems in response to price signals issued by the Midwest ISO,” the press release said.

“The Midwest ISO has also worked with its stakeholders in an open, collaborative process to develop options for the treatment of Grandfathered Agreements, which allows parties to choose how their agreements are treated under the tariff. This proposal seeks to hold the parties to the Grandfathered Agreements financially indifferent to their treatment in the energy markets, while also recognizing certain operational and reliability concerns.”

For more information, contact Mark Bennett at mbennett@epsa.org, or call 202-349-0152. For more about MISO, visit www.midwestiso.org.