DENVER — The SPP Strategic Planning Committee last week directed RTO staff to move forward with a high-priority congestion study that earlier failed to gain traction in the Markets and Operations Policy Committee.

SPP Board Chair Jim Eckelberger suggested that staff incorporate suggestions from American Electric Power’s Richard Ross, who presented the MOPC with a new approach to determining why customers participating in the congestion-hedging market are not being allocated their full auction revenue rights and long-term congestion rights (LTCRs).

Under the AEP plan, staff would study the last cycle of hedge requests, identify unfulfilled requests, determine the effects of counterflow not requested in the ARR process and determine upgrades necessary to allow awarding of those unfulfilled requests.

“There’s significant congestion restricting service,” Ross said. “Members played by the rules, sought out firm service, paid for upgrades on the system, paid for Z2 credits, but still find themselves in a situation where they are paying for congestion because TCRs are not feasible.”

Ross’ approach would focus on the first round of the annual auction, where market participants seek the congestion paths most important to them.

“We use that information to figure out what upgrades are needed,” he said. “We need to go through this process to determine the bottlenecks and how to solve them. The motivation of the [market-clearing] engine is to maximize the clearing of those ARRs or TCRs. What happens is transmission requests or ARRs with small amounts end up eroding away the congestion hedges.”

Ross’ alternative approach was rejected by the MOPC, as was staff’s hybrid approach using some of AEP’s suggestions. Staff was directed to undertake the study addressing congestion in the Texas Panhandle and western Oklahoma during April’s Board of Directors meeting, when directors and members canceled a major 345-kV Southwestern Public Service project near Amarillo. (See SPP Board Cancels Panhandle Line, Seeks New Congestion Study.)

SPP staff are to report back to the board next week with their study assumptions and scope. The study is to be completed no later than April 2018.

During the MOPC meeting, members pushed back against the idea of another one-off study because SPP’s first assessment of future needs — part of its revamped transmission planning process — is due in October 2019.

Eckelberger said, “Let’s ask the staff to bring us back in two weeks its best proposals on how we can swing through this process, learn something and get us a product we can execute in the April time frame of next year, as opposed to waiting until October ’19.

“I’d say it’s pretty easy,” he said. “Don’t put anything in [that study] that’s speculative, like oncoming wind and solar. Use today’s gas prices, because we’re talking about something that works between now and a different approach in 2019.”

Eckelberger suggested to staff and the SPC that any assumption of new wind capacity above 4 to 5 GW with signed interconnection agreements is speculative.

“I don’t consider [the 4-5 GW] speculative,” he said. “I consider it real. It’s going to come by 2019 or 2020. Where it happens remains to be seen.”

The chairman received support from members. Westar Energy’s John Olsen said the congestion study’s April deadline would mesh well with SPP’s transmission planning and help the Economic Studies Working Group in preparing scenarios to be analyzed.

“That’s about the same time we go into heavy data gathering of the [planning study],” Olsen said. “It will be a great help to the ESWG as it determines the next round of futures. It’ll be a great way for them to have a head start on what the futures might look like, and where we need to go.”

SPC Approves Zonal Placement Process Document

The SPC approved minor edits to a process document that lays out the steps SPP must follow in making transmission zonal placement decisions, although the document does little to quell stakeholder objections about cost shifts within the process. (See Divide Evident Between SPP Tx Owners, Users.)

The Transmission Owner Zonal Placement Process document addresses the growth of transmission zones in SPP’s footprint and concerns expressed over the process in FERC proceedings. Since 2004, the RTO has gone from 15 pricing zones and 15 separate zonal annual transmission revenue requirement (ATRR) amounts to 18 pricing zones and 47 ATRR amounts.

“It’s a first step. Denise’s proposal was a first step,” said SPS’s Bill Grant, referring to Denise Buffington of Kansas City Power & Light, who submitted a revision request that was rejected by the MOPC. “There’s still a lot of work to do in this area. If we vote this and move it forward and think our work is done … it’s not even close to being done.”

“This is as good as we’re going to get,” SPP’s Michael Desselle said, noting the SPC had already decided it had done all it could with the zonal-placement issue. (See SPP Advances KCP&L Cost Shift Proposal.)

The process document spells out the following four steps:

1. 1. 1. The applicant transmission owner (ATO) notifies SPP of its intent to transfer functional control of existing facilities to SPP and to file with FERC to recover the ATRR.
      2. SPP requests project information from the ATO upon notification.
      3. SPP performs integration analysis following a preliminary review of the ATO’s information. This step includes the RTO notifying TOs and network customers in zones into which the ATO could be integrated and providing them evaluation of cost shifts within 45 days after receiving the necessary information.
      4. Negotiation between the affected parties to discuss the zonal placement decision, potential cost shifts and any other resulting issues. The discussion period is limited to 45 days, with SPP available to facilitate if requested.

“I remain concerned because it doesn’t satisfy my concerns about lack of notice,” Buffington said, noting SPP gave an ATO entering KCP&L’s zone several alternatives before contacting the utility. “I understand SPP makes decisions on which zone to place someone, but when you talked to [the ATO], you showed them different options.”

“I’d really like your mindset to be looking out for your members and coordinating with your members,” Ross told SPP staff. “Don’t even look at it as ‘mother-may-I’ with someone who isn’t even part of system. Members who might be impacted should be your first thought, not your second.”

In the end, Grant and Nebraska Public Power District’s Traci Bender were the only members of the 14-person committee to vote against the motion. (Buffington is not a member of the SPC.) Kansas Electric Power Cooperative’s Les Evans abstained.

“I think this is a really good step forward,” said SPC Chair Mike Wise, of Golden Spread Electric Cooperative. “This gives a firm sense of the communication process.”