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EPSA Urges FERC to Reject RPM Buyers Complaint
WASHINGTON, D.C. - The Electric Power Supply Association (EPSA) today filed comments with the Federal Energy Regulatory Commission (FERC) strongly protesting a complaint filed by the RPM Buyers group challenging the results of the transitional base auctions of PJM's Reliability Pricing Model (RPM). RPM is a pricing system that was developed by regulators and stakeholders to ensure there is an adequate and reliable supply of electricity for PJM's 51 million customers, who reside in 13 states and the District of Columbia.
In its comments, EPSA pointed out that members of the RPM Buyers group were active previously in the RPM Proceeding and already challenged, or had the opportunity to challenge, the rules for the transitional auctions that they now challenge again in the Complaint. EPSA stated that, "the RPM Buyers have not shown materially changed circumstances that would merit revisiting the Commissions holdings in its orders in the RPM Proceeding. Importantly, they do not even allege that PJM failed to administer the auctions in accordance with the RPM rules or that there is some flaw in the auction results. Rather, the Complaint is directed entirely to purported "core deficiencies" in the RPM rules that were part of the settlement package approved in the December 22, 2006 and June 25, 2007 Orders." EPSA stated that those settlements should be honored, citing the difficult compromises among the diverse settling parties originally involved.
"The bottom line is that the transitional auctions were competitive and were conducted in accordance with the RPM rules, and the RPM Buyers have not offered a shred of reliable evidence to the contrary," said John E. Shelk, president and CEO of EPSA. In fact, a recent study by the Brattle Group confirmed transitional base auctions conducted to date have been successful in achieving the stated reliability and economic objectives of RPM. EPSA said, "The RPM Buyers suggest that the success or failure of RPM turns entirely on its ability to attract new generation. Not only do the RPM Buyers fail to recognize that the transitional auctions have been successful; they also fail to recognize that keeping existing generation needed for reliability in the market and attracting bids from demand response is equally vital to preserving reliability."
"Unless the Complaint is promptly and summarily denied, it threatens to undermine the effectiveness of RPM, as well as similar mechanisms in other markets, and thereby to discourage much-needed investment in existing and new generation infrastructure in PJM and in FERC-jurisdictional markets generally." "Inadequate investment will ultimately harm the same parties the RPM Buyers purport to represent: consumers," EPSA said.
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.