[UPDATED July 6 to reflect PJM’s comments detailing its objections to the proposal.]

PJM filed the joint stakeholders’ end-of-life (EOL) proposal with FERC on Thursday, turning aside the protests of most of its transmission owners, who claim moving EOL projects under the RTO’s planning authority violates their rights.

The 279-page filing notes that the Operating Agreement amendments, initiated by American Municipal Power (AMP) and Old Dominion Electric Cooperative (ODEC), were approved by 69% of the Members Committee on June 18 despite the RTO’s opposition (ER20-2308). (See PJM Stakeholders Endorse End-of-Life Proposal.)

“While PJM did not support these amendments in the stakeholder process, PJM submits them as the party assigned responsibility under the Operating Agreement to ‘administer and implement’ the Operating Agreement and to file changes to the Operating Agreement under [Federal Power Act] Section 205.”

The filing leaves FERC to decide between the stakeholders’ proposal and PJM’s plan, which was endorsed by the Transmission Owners Agreement-Administrative Committee (TOA-AC) in a June 12 filing proposing amendments to Tariff Attachment M-3 (ER20-2046). It would require TOs to have a formal program for EOL determinations and to identify potential EOL projects five years in advance. Projects that “overlap” with Regional Transmission Expansion Plan (RTEP) violations would be included in a competitive window seeking regional solutions. The RTO’s proposal failed to win consensus, with a sector-weighted vote of 36% at the May 28 Markets and Reliability Committee meeting.

ODEC and AMP have filed a motion to have the TOs’ filing dismissed on procedural grounds.

In filing the joint stakeholders’ proposal, PJM rebuffed the TOs, who argued in a June 26 letter that the proposal violates their rights under the Consolidated Transmission Owners Agreement. (See TOs Demand PJM Reject EOL Proposal.)

However, the RTO also filed comments detailing its objections to the joint stakeholders’ proposal.

The TOs and PJM contend the stakeholders’ proposal also violates FERC precedents and Order 890’s rules regarding transmission asset management. PJM has said decisions on when a facility is at the end of its useful life or otherwise needs to be replaced “are the sole responsibility of the transmission owner.”

PJM asked FERC to act within 61 days and proposed Jan. 1, 2021, as the effective date for the OA changes, if it accepts them. The RTO said the date would coincide with the beginning of the next cycle of the RTEP.

The joint stakeholders say their proposal complies with commission precedent by continuing to give TOs exclusive authority to determine whether a transmission asset has reached its EOL while making the replacement of such assets PJM’s responsibility through the RTEP.

The proposal would:

• modify OA Schedule 6 to create a process for evaluating and replacing EOL assets under the RTEP, removing the planning from Attachment M-3 of the Tariff;
• require TOs to develop an EOL program, including criteria, for facilities approaching their EOL and submit a binding notification to PJM of facilities that will reach their EOL within six years;
• require TOs to provide PJM a 10-year, forward-looking list of facilities’ EOL conditions;
• exclude the planning of EOL facilities from the RTEP reliability exemption for transmission facilities under 200 kV; and
• amend the OA definitions and Schedule 6 to remove EOL assets from evaluation as supplemental projects under Attachment M-3 and evaluate all EOL facilities as a separate category under Schedule 6.

PJM told FERC the changes “should be implemented prospectively … as there are no transition provisions in the joint stakeholder proposal for current EOL determinations less than six years out.”

PJM Comments

In separate comments filed later Thursday afternoon, PJM said the joint stakeholders’ proposal violates its governing documents and commission precedent on the RTO’s and the TOs’ roles in the planning of supplemental projects, including EOL facilities, and the planning of asset-management projects.

It noted that the stakeholder process “was markedly dominated by legal debates, including debates as to the meaning of certain governing documents and the scope of authority ascribed to PJM and the PJM transmission owners under those documents.”

“These legal issues, as well as related policy issues, are not ones that necessarily lend themselves well to final resolution in a stakeholder process,” PJM continued. “It is for this reason that PJM is filing these comments and urges the commission to provide clear resolution on the legal and policy issues raised by the joint stakeholder proposal.”

The RTO said the proposal that the EOL notifications be binding on the TOs “unreasonably restrict transmission owners’ flexibility regarding their end-of-life decisions over their transmission assets. More specifically, this lack of flexibility potentially impedes a transmission owner’s ability to modify its end-of-life decisions due to changes to system conditions or unforeseen circumstances that can impact an asset’s life. Instead, the proposal assigns the responsibility to PJM to determine whether to escalate or delay replacement of the transmission owner’s asset.”

It said although the proposal says that “‘determination of EOL is still a TO determination,’ the proposed revisions specific to EOL conditions seem to effectively assign that responsibility to PJM.”

PJM also cited an apparent inconsistency between exempting from the competitive window process EOL notifications on substation equipment while exempting facilities below 200 kV.