By Rich Heidorn Jr.
WASHINGTON — The Federal Energy Regulatory Commission signaled today that it will increase its scrutiny of the PJM-MISO Joint Common Market process amid complaints that PJM is improperly limiting MISO generation from full participation in its capacity market.
FERC commissioners indicated their concern in comments following presentations by representatives of PJM, MISO and state regulators at today’s commission meeting.
The commission ordered the presentation as part of a docket it created last June to determine whether it needs to get more involved in a long-standing dispute between PJM and MISO over PJM’s rules for determining the volume of capacity that can be imported across the PJM-MISO “seam.”
PJM: No Artificial Barriers
Andy Ott, PJM executive vice president for markets, told the commission that MISO’s complaints are belied by PJM’s 2016/17 capacity market auction, in which 4,700 MW of MISO capacity bid, all of it clearing. That was more than double the volume that bid in last year’s base auction; about one quarter of the total came from territory new to MISO, including the Entergy transmission system.
“We really haven’t seen barriers” to MISO generation, Ott said. Ott said the commission should not set deadlines for a resolution of the dispute but continue monitoring the JCM stakeholder process through its staff, calling it a “very powerful” force in ensuring the talks progress.
But Commissioner Tony Clark was unconvinced that what he called the commission’s “benign neglect” stance had been effective: “Staff has monitored [JCM] for the last six or seven years,” he said. “It stalled.”
Other commissioners also signaled impatience with the status quo.
Commissioner Cheryl LaFleur said that since FERC’s ill-fated attempt at imposing a Standard Market Design, the agency has allowed regional transmission operators to develop different market structures and operating procedures. While PJM and MISO have done the most work of any two RTOs on seams issues, she said, “There’s still a long, long list of things to work on.”
Deadline `Discipline’
Commissioner Philip Moeller said the resumption of the JCM process last year was “overdue” and that the talks could benefit from the “discipline of a deadline.”
“To the extent that this becomes a reliability issue, it’s absolutely something we can’t ignore,” he said, referring to MISO’s concerns that its current capacity surplus may become a shortage in several years, requiring it to seek capacity imports from PJM.
Commissioner John R. Norris said MISO may be correct in its complaint that PJM rules are artificially restricting capacity imports below physical transport limits. “My sense is, there is a there there.”
PJM and MISO have been holding monthly JCM meetings since July but MISO says the talks have made little progress in addressing capacity deliverability. In a filing in January, MISO asked the commission to set deadlines for resolution of the issue. PJM responded that the commission should reject MISO’s request and close the docket.
State Regulators’ `Blueprint’
Commissioner Clark said the commission should follow the “blueprint” proposed by state regulators last week. The joint filing by the Organization of PJM States (OPSI) and the Organization of MISO States (OMS) called for fact finding to identify methodologies for: determining transfer capability between MISO and PJM; the feasibility of potential revisions to existing rules and a way to compare the costs and benefits of such changes.
The states said the JCM should consider hiring an independent consultant to help mediate if PJM and MISO are unable to agree.
“It is not helpful for either RTO to insist upon an end-result or outcome without having supportive documentation and analysis,” the groups said. “Without collaborative involvement from both RTOs the output of any fact finding and subsequent analysis would likely be unreliable.”
Links to Presentations
