The Federal Energy Regulatory Commission approved PJM’s plan for selecting transmission projects that can easily and cheaply resolve constraints in Locational Delivery Areas (LDAs).

The new rules require PJM staff to identify — before posting the planning parameters for each Base Residual Auction — Locational Deliverability Areas in which the Capacity Emergency Transfer Limit is less than 1.15 times the Capacity Emergency Transfer Objective (See Quick Fix Transmission Upgrades Ok’d).

Upgrades that increase the ratio to more than 1.15 would be added to the Regional Transmission Expansion Plan (RTEP) if they cost less than $5 million and can be completed prior to June 1 of the Delivery Year. Projects that duplicate upgrades whose cost is already assigned to an interconnection customer would be excluded.

Such projects are unlikely to be common. PJM told the commission that it had identified no circumstances that would justify such projects in the last three years.

FERC approved the proposal over the objections of Utility Risk Management Corp. (URMC) and NextEra (ER14-456).

URMC said the proposal would hurt merchant transmission developers by allowing PJM to supplant merchant upgrades. NextEra argued that the proposal would disguise price signals and reduce transparency and innovation.

FERC said the narrow scope of these quick-fix projects was enough to alleviate these concerns and ensure consistency with Order 1000.

FERC endorsed PJM’s contention that, in relieving minor constraints that are unlikely to return in future years, it prevent misleading price signals.

As a condition of the approval, FERC required that PJM post an annual list of quick-fix proposals and recommended that the RTO and its stakeholders devise operational procedures in case such a project cannot be completed by June 1 of the relevant delivery year.