FERC on Thursday ordered National Grid (NYSE:NGG) subsidiaries New England Power and Narragansett Electric to cease assessing direct assignment facility charges to a solar developer interconnecting four 9.6-MW projects until they properly comply with a provision in ISO-NE’s tariff (EL21-47).
Under the tariff, direct assignment facilities are transmission upgrades or additions constructed for the sole benefit or use of a transmission customer. Their costs are thus not shared and are directly assigned to the customer; in this case, distribution utility Narragansett, which passed the costs of the upgrades necessary to interconnect the projects through to developer Green Development in their interconnection service agreement.
Green Development complained to FERC that transmission owner New England Power had not properly followed ISO-NE’s process for designating the upgrades as direct assignment facilities to Narragansett. It also argued that the upgrades were not for Narragansett’s sole benefit or use
The commission said that Green Development had demonstrated that the upgrades had not been “specified in a separate agreement” from the ISA between the three companies, as required by ISO-NE.
But FERC also said that the developer had not demonstrated the upgrades were not solely for Narragansett.
“Green Development contends that, because the upgrades will allow Green Development to interconnect to Narragansett’s distribution system, the upgrades cannot be considered for the ‘sole use/benefit’ of Narragansett,” the commission wrote said. “Green Development provides no evidence to support this proposition. The direct assignment facilities are upgrades to Narragansett’s transmission system, and Narragansett will be the only transmission customer using the upgrades, which are necessary to ensure that Narragansett can accommodate the interconnection of Green Development’s projects to Narragansett’s system while continuing to reliably serve its existing network loads.”
FERC did find that Green Development met the burden of proof to demonstrate a failure to comply with the second part of the definition of direct assignment facilities that requires them to be “specified in a separate agreement among ISO-NE, the interconnection customer and the transmission customer, as applicable, and the transmission owner whose transmission system is to be modified.”
National Grid admitted that the upgrades had not been specified in a separate agreement but contended that the transmission service agreement among New England Power, Narragansett and ISO-NE stipulate that they are subject to direct assignment facility charges, thus satisfying the RTO’s requirement. The commission disagreed with that argument.
“We find that the Narragansett TSA does not specify the direct assignment facilities that New England Power seeks to assign to Narragansett; rather it merely states that ‘service under this local service agreement shall be subject to the following charges’ and then lists a number of charges including a ‘direct assignment facility charge,’” FERC wrote. “Accordingly, we agree with Green Development that the upgrades have not been specified in a separate agreement as required by the definition of direct assignment facilities.”
The commission ordered that New England Power not to assess direct assignment facility charges to Narragansett for the upgrades “unless and until it complies with this part of the definition.”