By Tom Kleckner
SPP stakeholders approved a revision request Tuesday that allows the RTO to lower its planning reserve margin as it waits on a quorum-less FERC to act on a proposed Tariff change.
The Markets and Operations Policy Committee approved RR230 during a special conference call, changing SPP’s criteria to allow it to reduce the planning reserve margin to 12% from 13.6% effective June 1.
The new reserve margin was included in SPP’s March filing asking FERC to approve the changes effective June 1 (ER17-1098). SPP COO Carl Monroe said the RTO had yet to hear from the commission, necessitating a vote on an interim solution.
“We don’t know why they haven’t acted … we assume because of a lack of quorum,” Monroe said during the hour-long conference call.
On Wednesday, FERC responded by saying SPP’s resource-adequacy requirement filing was deficient and that additional information is required to process the request. The commission listed 18 questions to be addressed related to:
- SPP’s firm power, firm capacity and net peak demand requirements.
- How market participants may assign their obligations and responsibilities to other market participants.
- The RTO’s annual deliverability study that determines the load a resource may deliver to the balancing authority area without effecting reliability or requiring additional transmission upgrades.
- Deficiency payments and distributions of revenues.
FERC has been operating with only two commissioners since February, when former Chairman Norman Bay resigned and left the commission with three vacancies. The Trump administration only recently nominated two commissioners, who went through confirmation hearings last week. (See No Fireworks for FERC Nominees at Senate Hearing.)
SPP stakeholders resisted staff’s initial request to approve RR230 by an email vote, made when it became likely FERC was not going to act by the effective date. American Electric Power, Westar Energy, Kansas City Power & Light, Oklahoma Gas & Electric and Duke Energy were among those requesting further discussion.
“I feel like we’re pushing something through that would be better in a thought-out process,” Westar’s John Olsen said. “It’s a little item, but I don’t know what the unintended consequences are. If FERC doesn’t approve [the proposed Tariff] language, then where are we at?”
“Had this been advanced as an issue by OGE rather than staff … I would have worked with [OGE] beforehand,” AEP’s Richard Ross said.
As it was, Ross worked with OGE Energy’s Greg McAuley, Omaha Public Power District’s Joe Lang and Midwest Energy’s Bill Dowling to hammer out the final motion’s language. A key addition was language making RR230 effective for only 10 business days after FERC rules on SPP’s filing.
Members overwhelmingly approved the motion, with only five opposing votes and two abstentions.
RR230 earlier cleared the Supply Adequacy, Transmission, and Regional Compliance working groups with two opposing votes and three abstentions.
SPP’s filing came after the MOPC and the Board of Directors in January approved a package of policies that included the 12% planning reserve margin, which translates to a 10.7% capacity margin.
A task force spent two years on that package, which it says will reduce the RTO’s capacity needs by about 900 MW and save members $1.35 billion over 40 years. (See “Stakeholders Endorse 12% Planning Reserve Margin, Policies,” SPP Markets and Operations Policy Committee Briefs.)
The original revision request incorporated previously approved policies defining a resource adequacy requirement, identifying who is responsible for resource adequacy, and how and when the requirement should be met. The policies are to become effective this summer, with the exception of an assurance policy requiring entities short on their planning reserve margins to make payments to entities with excess capacity, based on forecasted information.
Members agreed to use 2017 as a “dry run” for the resource adequacy process.
