By William Opalka
The Federal Energy Regulatory Commission and New York regulators will hold a joint technical conference Nov. 5 to discuss the state’s capacity market and plans to revamp the utility business model to accommodate renewable energy and distributed resources.
FERC’s conference with the New York Public Service Commission will be held from 9:30 a.m. to 5 p.m. at the New York Institute of Technology in Manhattan.
Reforming the Energy Vision
One focus of the conference will be the PSC’s Reforming the Energy Vision (REV) initiative, which the commission announced in April.
The PSC noted that technological innovation and the increased competitiveness of renewable energy and distributed resources is occurring as the state confronts aging infrastructure, extreme weather events and challenges to system security.
FERC Chairman Cheryl LaFleur said the commission wants to learn about how the REV program intends to reform the state’s energy industry and regulatory practices to meet these challenges.
“The New York PSC and New York leadership have produced some interesting things around their REV … that would potentially require evolution in the role in some of the things that we’re looking for from the ISO,” she explained after announcing the technical conference at last week’s FERC meeting.
The PSC released a straw proposal in August that found “There is large potential for the integration of Distributed Energy Resources (DERs) into the New York electricity market, via a Distributed System Platform (DSP) framework.”
The report outlined potential reforms in the utility ratemaking process “to provide the correct incentives for utilities and markets to develop a cleaner and more efficient electric system.”
A two-track public proceeding is examining the regulatory reforms. The first track examines the role of distribution utilities in deploying distributed energy resources to promote load management and system efficiency, including peak load reductions. The second, parallel track will consider changes in tariff and market designs and incentives to align utility interests with the policy objectives.
Public comment on the proposal was due yesterday.
Capacity Zone Controversy
The Nov. 5 conference will also be something of a fence-mending effort for FERC, following its approval of a controversial capacity zone intended to address transmission congestion north of New York City.
Opponents claim the zone, which took effect May 1, will create a windfall for existing generation owners before the region’s constrained supply issues can be full addressed.
In July, New York Sens. Charles Schumer and Kirsten Gillibrand voted against the reconfirmation of LaFleur, a fellow Democrat, to FERC. Before the vote, Majority Leader Harry Reid (D-Nev.) said he had spoken to LaFleur about the criticism of the capacity zone and that she had agreed to “take a hard look at” it. (See New Yorkers Upset over NYISO Capacity Zone.)
LaFleur Thursday acknowledged the controversy over FERC’s approval of the zone. “Those orders are final but it seemed like it might be a good time to consider: Is the capacity market attracting the investment we need for reliability? Let’s have a refresher on where we are,” she said.