By Suzanne Herel

VALLEY FORGE, Pa. — Nearly everyone who spoke at last week’s PJM Members Committee meeting agreed that stakeholder discussions are enhanced by the participation of the Consumer Advocates of the PJM States. But not everyone wants to pay to have them in the room.

A proposal by CAPS Executive Director Dan Griffiths that the RTO fund the group’s $450,000 budget through an assessment on electric customers won support from state regulators and other load interests but drew sharp opposition from suppliers.

Griffiths and West Virginia Consumer Advocate Jacqueline Roberts proposed that CAPS’ budget be funded in part through an assessment on electric sales similar to the funding Organization of PJM States (OPSI). They said it would amount to eight-tenths of a cent for a residential customer using 12,000 KWh annually.

Opposed in Principle

But while the charge would be miniscule, some market participants said they opposed it in principle.

“Our company is a great believer in markets and competitive markets, and we have trouble funding an organization that is comprised of entities that have challenged competition at the state level and at PJM,” said Marji Philips of Direct Energy. “Frankly that was why our company decided we could not get behind this proposal.

“Some [advocates] have been vehemently anti-competition at the retail level,” she added.

“Silencing views that don’t agree with you doesn’t give you a better stakeholder process. It might give you a quieter stakeholder process,” Roberts responded.

“There’s nothing to keep you from dialing in” to the meetings, Philips countered.

She added later that while Direct Energy supports the advocates’ participation at PJM meetings, it believes their funding should come from their states.

CAPS is a nonprofit group made up of consumer advocates from the PJM states and D.C. It was formed in 2012 with start-up funding from a FERC enforcement settlement with Constellation Energy (IN12-7-00), allowing advocates to travel to PJM meetings in Valley Forge, Pa., and Wilmington, Del.

CAPS’ assessment on electricity consumers would be supplemented by remaining Constellation funds along with contributions Exelon has offered to win its acquisition of Pepco Holdings Inc. Exelon’s Jason Barker said that as part of its effort to win approval of the merger, “Exelon has agreed to support reasonable proposals to have PJM members fund CAPS.” (See related story, Reports: Exelon Considering D.C. HQ to Win Pepco Deal.)

The rationale for the assessment, said Griffiths, is that consumers deserve a voice at PJM because the majority of charges they see on their electricity bill are the result of actions taken at the RTO and FERC. “We think that being here is a benefit to everybody,” he said.

Chris Norton, director of market regulatory affairs for American Municipal Power, said the assessment would be unfair to his public power members who are not represented by CAPS. PJM CFO Suzanne Daugherty said there was no way to excuse AMP members from the assessment because many public power customers are supplied through “commingled” customer accounts.

PJM: Up to Members to Decide

PJM Market Monitor Joe Bowring and CEO-elect Andy Ott agreed that CAPS’ involvement has been beneficial.

“If you look at the past 18 months, when the CAPS organization has stood up and been engaged in the stakeholder process, I think it’s been enriching,” Ott said. “The positive nature of having consumer advocates be engaged is obvious. It seems to me that all of us have seen that happen.”

But, he said, “When you get to the question of … should the funding be through the PJM Tariff — there, I think it’s beyond what PJM should be opining on. That’s a members’ decision.”

Dynegy’s Jason Cox and Jesse Dillon, assistant general counsel for Talen Energy, also opposed the proposal.

“If [the amount is] so de minimis, it seems like the states could fund it themselves,” Cox said.

“We don’t think PJM members should be forced to fund private speech and expression with which we may disagree,” said Dillon. To say retail customers would bear the charge is a “sophistry,” he added.

“They’re charging load-serving entities,” he said. “We are an LSE, and we do not have the ability to pass costs on to customers like others might.”

ODEC Position ‘Evolved’

Ed Tatum said the thinking of Old Dominion Electric Cooperative used to be in line with Talen’s.

But, he said, “Old Dominion’s thinking on this has evolved. We have experienced the stakeholder process without strong [consumer] representation. Through CAPS, now we have an engaged, knowledgeable group of folks [who seek to achieve consensus]. … We would support CAPS.”

Susan Bruce, representing the PJM Industrial Customer Coalition, said her group realizes “the importance of this forum on ratemaking at the state level: Two-thirds or three-quarters of customers’ bills are a result of actions here or at FERC.”

“We think the stakeholder process is more vibrant with them and helps us avoid surprises at the FERC level,” she continued. “My clients, they’re willing to pay that cost.”

The debate echoed that in MISO in April, when the RTO declined a request by consumer advocates for $200,000 to help cover its legal costs in a fight over MISO transmission owners’ return on equity. (See MISO to Consumer Sector: No Money for You.)

Roberts noted, however, that MISO’s advocates receive funding through the tariff for the Organization of MISO States. Griffiths pointed out that CAPS has pledged not to use its funding to litigate at FERC.

Roberts indicated confidence that the funding request will be approved, insisting those who spoke in opposition did not represent a wide group of stakeholders. “We have strong support and support in every sector,” she said.