MISO, PJM and SPP have been failing for years to find a suitable replacement for a 20-year-old system reference they use to portion out flow rights on their system — and they don’t appear to be any closer to a solution. 

The three RTOs calculate establish market flows and firm entitlements on jointly managed flowgates using a snapshot of the neighboring systems in 2004 before their seams existed; they refer to it as their “freeze date.” So far, the three grid operators haven’t found a substitute for using a static list of generation resources and transmission service requests that remains unchanged from when Usher’s “Yeah!” topped music charts. 

MISO Independent Market Monitor David Patton has expressed frustration with the three not being able to land on a more suitable system representation. 

“The problem is we’re so far beyond the freeze date that it’s untenable,” Patton told the MISO Board of Directors’ Markets Committee on Sept. 17. 

Instead of adhering to their tariffs and joint operating agreements, the RTOs have resorted to patchwork processes to oversee flow entitlements, he said. The “impossibly stale” depiction of the systems is leading the grid operators to violate their rules, he argued. 

Patton indicated to the committee that talks between the three RTOs to find a substitute for the freeze date recently broke down.

“MISO’s put the most reasonable negotiations on the table. MISO is not the problem here,” Patton said, avoiding naming any party who might have been difficult in negotiations. “I want to alert you that something needs to be done about this. … They’ve been negotiating for a decade.” 

Patton implied that if MISO had agreed to some terms contained in the proposed agreement, it would have resulted in unreasonable outcomes for its members. 

WEC Energy Group’s Chris Plante characterized RTOs’ inability to replace the freeze date as one of the seams issues that “seems like low-hanging fruit that refuses to fall off the tree.” 

“We’ve been trying to resolve that issue for more than a decade,” Plante said during a meeting of MISO’s Advisory Committee on Sept. 18. He said the issue is emblematic of how elusive solutions to seams issues can be. 

SPP Manager of Interregional Strategy and Engagement Clint Savoy confirmed before the RTO’s Seams Advisory Group on Sept. 11 that a comprehensive freeze date solution was voted down. He said the initiative is now being reworked among the RTOs for future evaluation. 

PJM also said the RTOs’ Congestion Management Process Working Group is actively working on an alternative solution. The RTO said it believes an “updated model” is needed to “better align current congestion patterns with planning processes while accounting for centralized dispatch.” The current freeze date takes into account “generation dispatch in the historic control areas rather than the current centralized dispatch approaches in the participating markets,” spokesperson Jeffrey Shields said in a statement. 

PJM did not respond to RTO Insider’s request for comment on where solution discussions currently stand and if it viewed any party as making unreasonable demands. 

MISO acknowledged that using the April 1, 2004, date to determine firm rights on flowgates based on pre-market flows is suboptimal. 

“RTO systems have changed considerably over the last 20 years, making it more of a challenge for MISO to balance the needs of our system as well as our neighboring grid operators. MISO recognizes the inherent errors that occur with mapping a 2024 market system back to the historic 2004 framework,” spokesperson Brandon Morris said in a statement. 

MISO said it has proposed a solution “based on approved industry standards,” which is being discussed, though there is no timeline on when it could be implemented. 

Savoy said SPP “remains committed to developing a solution that will facilitate equity, transparency and mutually beneficial outcomes for all involved, including the customers and facilities that we represent as the RTO.” 

However, Savoy added that replacing the freeze date is a complex endeavor “involving numerous parties with diverse interests.” 

“We’re grateful for our partnerships with MISO, PJM and the rest of the Congestion Management Process operating entities, and for the engagement of many of our stakeholders through our Seams Advisory Group. We look forward to sharing more about our approach to this matter in the upcoming joint SPP-MISO Common Seams Initiative meeting in November,” Savoy said in a statement. 

For years, the RTOs kicked around a proposed solution that would have divided flowgate rights by age, with priority given to network resources from 2004 and earlier, followed by network resources after 2004, then transfers between local balancing authorities to make up shortages on a pro rata basis, and finally RTO load served by RTO dispatch. The solution would have increased transfer rights for markets over nonmarket entities, and the seams might have experienced a reduction in nonfirm transfer availability and increased curtailments of nonfirm transfers. 

MISO and PJM had hoped to implement this flowgate merit order by mid-2022. MISO in 2021 said the sticking point was the firm flow limits calculations with nonmarket entities, who said a large increase of firm rights for market entities could increase the need for transmission loading relief. At the time, MISO reported that nonmarket entities party to the RTOs’ Congestion Management Process were still resistant to changes that would affect firm flows in the region. (See MISO, PJM Eye Nov. Freeze Date Defrost.) The nonmarket neighbors remain concerned that an increase in firm limits for post-2004 network resources could lead to more curtailments for those outside the markets. 

From MISO and PJM’s Joint and Common Market meetings in the last few years, the RTOs appeared to be ready to use a new model in their respective Energy Management Systems. Last year, the two said they were readying a mock analysis tool to test scenarios. 

The RTOs also completed a white paper on the freeze date in 2021; at the time, it was a diplomatic turnaround from late 2019, when staff said they were mulling filing proposed solution that would all but certainly be opposed by nonmarket parties and leave it up to FERC’s discretion.