FERC last week ordered hearing and settlement judge procedures on American Transmission Systems Inc.’s (ATSI) request to recover deferred and ongoing legacy costs related to the company’s move from MISO to PJM in 2011 (ER20-1740).
ATSI’s proposed revisions to its transmission formula rate, filed by PJM in May, sought $154 million in additional rates, including legacy MISO Transmission Expansion Plan costs, costs of ATSI’s integration into PJM and deferred vegetation management costs.
In 2011, the commission rejected ATSI’s first request for recovery of PJM integration costs and MISO exit fees, saying the company had failed to “provide sufficient information or support that would enable the commission to find that it is just and reasonable for ATSI’s transmission customers to bear the costs arising from the decision to switch RTOs.”
FERC upheld the denial on rehearing in 2016. It said its ruling was without prejudice, allowing ATSI to file a new request that included a detailed cost-benefit analysis showing that the benefits to wholesale transmission customers exceed the costs of the switch to PJM. (See FERC Rejects ATSI Bid for Cost Recovery on Switch from MISO to PJM.)
In justifying its new rate request, ATSI, a unit of FirstEnergy, said its move to PJM has generated about $4 billion in benefits, dwarfing the $154 million it seeks to recover.
But American Municipal Power (AMP), Buckeye Power, Industrial Energy Users of Ohio (IEU) and the federal energy advocate for the Public Utilities Commission of Ohio protested the request.
AMP and Buckeye said the request should be rejected because of the four-year delay in refiling for the RTO transition costs since the commission’s 2016 rehearing order. AMP said utilities should not have unlimited discretion on how long it will carry deferred costs on its books. AMP, Buckeye and IEU also contended that ATSI’s cost-benefit analysis did not accurately calculate the impact on Ohio retail customers.
IEU and AMP also challenged ATSI’s request for $18.7 million in deferred vegetation management costs incurred from 2013 to 2016, saying the company failed to demonstrate that they were “enhanced” or prudently incurred.
Citing the disputes, the commission’s order accepted ATSI’s proposed Tariff revisions and suspended them for five months to become effective Dec. 1, subject to refund.
