VALLEY FORGE, Pa. — Interim PJM CEO Susan J. Riley told the Markets and Reliability Committee on Thursday that work continues in the Financial Risk Mitigation Senior Task Force to overhaul credit policies in the wake of the GreenHat Energy default.

“We want to be sure that we are not making one-off changes that have unintended consequences,” she said. “I’m sure you can appreciate [the need for] … establishing collateral rules that protect our members.”

Nigeria Poole Bloczynski, PJM’s newly hired chief risk officer, addressed the task force during its Aug. 15 meeting and said that while the GreenHat default — which could cost members more than $430 million — prompted the review, the forthcoming changes will benefit “all of PJM’s markets.” (See PJM: FERC Order Could Boost GreenHat Default by $300M.)

“While there’s some low-hanging fruit, what I want to do is take a very thoughtful approach as it comes to pulling together the credit-risk policy, because I think we can tackle some issues that not only relate to FTRs, but to the broader market that we participate in,” she said in a press release. She also said the RTO must monitor and “take active measures to mitigate risk exposures that are generated by each participant.”

Riley also told the task force that feedback from members remains paramount in structuring effective reforms.

“We’ll propose certain things that we feel are important, but we really want your input and your thoughts on their viability, on how these things affect your companies [and] your businesses,” she said. “We think we’re doing the right thing and feel pretty strongly — but again, we welcome your input.”

Non-retail BTM Generation Vote Delayed

Stakeholders deferred a vote on manual revisions that clarify updates to PJM’s non-retail behind-the-meter generation (NRBTMG) rules, opting for more time to discuss elements of the proposal regarding community solar and net energy metering.

Exelon led the effort for delay after requesting to remove the voting item from the consent agenda. Sharon Midgley, director of wholesale development for Exelon, said her company could “benefit from another month of discussion.” Public Service Enterprise Group, the PJM Public Power Coalition and Duquesne Light Co. agreed.

The revisions to Manuals 13 and 14D, which address the reporting, netting and operational requirements of NRBTMG, are intended to ensure member and PJM responsibilities, processes and procedures are clear and adequately captured, said Terri Esterly, PJM’s senior lead engineer for capacity market operations. (See “BTM Generation Clarifications,” PJM OC Briefs: Aug. 6, 2019.)

NRBTMG refers to resources used by municipal electric systems, electric cooperatives or electric distribution companies to serve load. They do not participate as supply resources in PJM markets but can be netted against their wholesale load to reduce transmission, capacity, ancillary services and administrative fee charges.

Midgley said Exelon approves of the concepts and reporting requirements outlined in the manual change but is still reviewing differences in the application of the rules — specifically whether community solar programs and aggregate net energy metering are within scope.

“Exelon doesn’t think they fall into a ‘non-retail behind the meter generation’ category, and PJM is interpreting these types of programs as being in scope,” she said. “If in scope, these programs would need to respond to certain emergency procedures, and we are questioning if this is appropriate.”

Fuel Security Charter Revisions Endorsed

The MRC unanimously endorsed a revised charter for the Fuel Security Senior Task Force, which will allow members to progress to phase 2 and bring its recommendations to the Dec. 19 MRC meeting — three months after its original deadline of September.

Tim Horger, director of energy market operations for PJM, said the modified timeline streamlines the process and keeps stakeholders out of a “messy” situation should recommendations scheduled for next month not win endorsement.

The task force is expected to deliver recommendations to the MRC on whether market, operational or planning changes are needed to ensure “fuel/energy/resource” security. (See PJM Stakeholders Reluctantly OK Fuel Security Initiative.)

Manuals Endorsed

Stakeholders endorsed the following manuals:

• Manual 10: Pre-Scheduling Operations, regarding generator outage reporting. The changes include clarifications for outage ticket end dates for deactivations and outage ticket requirements for black start service.
• Manual 11: Energy & Ancillary Services Market Operations and Manual 18: PJM Capacity Market, to bring the RTO into compliance with PJM MIC Briefs: July 10, 2019.)
• Manual 18B: Energy Efficiency Measurement & Verification, resulting from a periodic review.

– Christen Smith