By Rich Heidorn Jr.
FERC last week upheld its February 2016 ruling that projects solely addressing a transmission owner’s local planning criteria are not eligible for regional cost allocation, rejecting rehearing requests from Dominion Resources and others.
“Cost allocation is not an exact science, and there may be ‘multiple just and reasonable rates’ on the same set of facts. Here, whether the allocation proposed by the PJM transmission owners is the best allocation method is not the issue; the issue is whether it is a just and reasonable method, and we find that it [is] just and reasonable based on the supporting data,” the commission said (ER15-1387-002).
The commission directed PJM to make a compliance filing ensuring that the costs incurred after the May 25, 2015, effective date of its February order for projects included in the Regional Transmission Expansion Plan solely to address Form 715 local planning criteria be allocated to the zones of the individual TOs. PJM must also rebill for any costs for such projects allocated incorrectly for the period.
FERC also denied rehearing in two cases applying the 2016 ruling and making Dominion solely responsible for the cost of its 500-kV Cunningham-Elmont (RTEP project b2582) (ER15-1344) and Cunningham-Dooms rebuilds (b2665) (ER16-736, EL16-96-001).
Dominion argued that the projects have regional benefits, unlike most Form 715 projects, which deliver only local benefits. Old Dominion Electric Cooperative, LSP Transmission Holdings and ITC Mid-Atlantic Development also had sought rehearing. (See Dominion: Tx Project Should be Regionally Allocated.)
Commissioner Cheryl LaFleur repeated her earlier partial dissents in the three dockets, saying that “high-voltage transmission lines in PJM have inherent regional benefits that warrant some measure of regional cost allocation, and those benefits exist regardless of the underlying need that drove the project.”
The commission also denied Public Service Electric and Gas’ request to reconsider an order assigning its zone all of the costs of its Sewaren upgrade to replace aging infrastructure and provide storm hardening (ER14-1485). PSE&G said the Sewaren projects (b2276, b2276.1 and b2276.2) addressed both aging infrastructure and short-circuit issues. It will convert the two 138-kV circuits from Sewaren–Metuchen to 230 kV and make related changes.
