PJM will revise its conflict of interest policy to reflect the increasing number of consumer product companies, manufacturers and technology companies becoming involved in the electric industry.

The Federal Energy Regulatory Commission prohibits PJM staff and board members from owning stock in any “market participant,” which FERC defines as including PJM members and their affiliates. Exempt are companies that do “not have economic or commercial interests that would be significantly affected by the [RTO’s] actions or decisions.”

PJM’s proposed revisions to its Operating Agreement are based on those approved by FERC for NYISO and MISO.

PJM plans to add a new Section 10.2.1 to the OA (“Financial Interests”) similar to its current Code of Conduct. The section will include a new definition of “prohibited securities,” applicable to the stocks of PJM members, non-incumbent transmission developers, “eligible customers” — transmission owners, power marketers or others generating electricity for resale — and their affiliates.

PJM would allow employees and directors to invest in companies with a de minimis relationship to the RTO, as determined by a “no” answer to each of the following questions:

• Is the company’s primary business purpose to transact in the electricity industry or is it a non-incumbent transmission developer pre-qualified to be a designated entity under PJM’s transmission planning?
• Are the member’s annual PJM total financial settlements more than 0.5% of the member’s annual gross revenues?
• Are the member’s annual financial settlements in PJM more than 3% of the total transactions for which PJM Settlement is a counterparty?

General Counsel Vince Duane said the changes were needed to simplify compliance and ensure the policy doesn’t create employee recruiting or retention problems.

”It’s no longer intuitive that a Google or a Microsoft is not a member,” Duane said. Google is an investor in the Atlantic Wind Connection, a proposed transmission project to serve off-shore wind generators.

PJM will seek Members Committee approval Oct. 30.