By Amanda Durish Cook
FERC last week rejected MISO’s attempt to exempt external generators from interconnection milestone payments, saying the fees should be applied equally to all classes of customers (EL16-12, et al.).
MISO had exempted from its M2 milestone payments external network resource interconnection service (E-NRIS) customers and NRIS-only customers. NRIS allows a generator to deliver power over MISO’s grid with the same rights as any other network resource. E-NRIS service allows generators outside the RTO to participate in capacity auctions and deliver their output into the system.
MISO said the M2 payment should not be assessed to E-NRIS customers because it is intended to deter speculative projects and is refunded once a generator begins commercial operations. E-NRIS customers are either in-service, under construction or have an executed interconnection agreement with the transmission provider to which they directly interconnect.
MISO’s position was challenged last year by EDF Renewable Energy, E.ON Climate & Renewables North America and Invenergy, which contended the RTO’s policy created a competitive disadvantage for new internal generation, which is required to make the milestone payments.
FERC responded to the complaint in April by implementing a Section 206 proceeding and requiring MISO to justify its position. (See FERC Orders MISO to Charge Uniform Interconnection Fees.)
In its order last week, FERC said MISO’s defense that the M2 milestone payment was only needed to deter speculative projects was unconvincing.
“To the contrary, we find that the reduction of late-stage terminations and the resultant restudies, as well as the mitigation of potential cost increases to lower-queued customers due to any restudies, are equally important goals of the M2 milestone payment,” the commission said.
“We find that it is just and reasonable that all interconnection customers post the M2 milestone payment in order to protect other customers from the potential harm that any interconnection customer may cause by a late-stage withdrawal,” it added.
FERC gave MISO 30 days to make the Tariff changes and set an April 5, 2016, refund date.
The order came as MISO plans to file its revised interconnection queue process. If approved, queue changes will take effect in January. (See MISO: Stakeholders Behind 2nd Queue Reform Attempt.)
In a separate order, the commission also rejected MISO’s request for rehearing on the basis that existing and external customers are not “similarly situated” to other interconnection customers and forcing them to pay the milestone payment would be fraught with “practical difficulties” (EL15-99, et al.). FERC said its April order “only found that it may be unduly discriminatory to exempt existing generators” and did not constitute a final determination, so it could not be challenged.
