FERC last week rejected the New York Public Service Commission’s request to rehear a November 2017 decision granting NextEra Energy Transmission New York (NEET NY) a 50-basis-point adder for participating in NYISO.

The ISO in October selected the company’s Empire State Line proposal to address a need for new transmission in western New York.

FERC’s Feb. 28 order dismissed the PSC’s argument that a participation adder — or membership incentive — was unnecessary because NYISO selected NextEra as part of its transmission planning process, leaving the company no choice but to turn over operational control of its transmission to the ISO (ER16-2719).

The federal commission countered that the incentive recognizes the consumer benefits, including reliability and cost benefits, that flow from ISO membership.

Section 219 of the Federal Power Act provides for incentives to each transmitting utility or electric utility that joins an RTO/ISO, and incentive-based rate treatments benefit consumers by ensuring reliability and reducing the cost of delivered power, FERC said.

“We consider an inducement for utilities to join, and remain in, transmission organizations to be entirely consistent with those purposes … and the best way to ensure those benefits are spread to as many consumers as possible is to provide an incentive that is widely available to member utilities … and is effective for the entire duration of a utility’s membership in the transmission organization,” FERC said.

FERC granted NEET NY’s request subject to the return on equity with the adder being within the zone of reasonableness, it noted.

— Michael Kuser