A group of consumer advocates requested rehearing Monday of FERC’s decision in November to open a paper hearing on PJM transmission owners’ proposal to add network upgrades to their rate base (ER21-2282).
The Maryland Office of People’s Counsel, the D.C. Office of the People’s Counsel and the Delaware Division of the Public Advocate argued the TOs do not have “exclusive and unilateral rights to file under Section 205” of the Federal Power Act to change network upgrade rules in the tariff, “particularly the rules impacting major elements of the market structure such as those relating to network upgrades affected in this proceeding.”
“There are good public policy reasons for the existing division of filing rights,” the advocates said. “Significant changes to PJM market design should be carefully considered by all stakeholders in the PJM market, either through a stakeholder process or their interactions with the RTO. This process allows PJM and, through its review of PJM’s filing, the commission to receive a balanced perspective that considers generation and consumer interests as well as those of transmission owners. The PJM TOs’ unilateral filing rights, which by definition are necessarily parochial in nature, are appropriately limited to areas related to rate design and revenue adequacy.”
The TOs had asked the commission on June 30 to allow them the option to fund network upgrades and add them to their rate bases. Under PJM’s “participant funding” model approved in 2004, generators provide the capital for network upgrades, while the additional infrastructure is added to rate bases at zero cost, allowing TOs to recover only their operations and maintenance expenses from network transmission customers. (See FERC Establishes Paper Hearing on PJM Rate-base Network Upgrades.)
The advocates said the tariff modifications would impede PJM’s “exclusive rights to change terms and conditions related to billing and cost recovery” because they would change how the RTO collects payments for network upgrades. They also said FERC’s order “interferes” with PJM’s responsibility to review public policy objectives when evaluating projects and needs in the Regional Transmission Expansion Plan.
“The authority granted to the PJM TOs by the November 2021 order must be part of a market design that is consistent with or superior to the market design approved in Order No. 2003, but, as reflected in the June 30 filing, it is not,” the advocates said.
FERC previously set a deadline of Jan. 3 for initial responses to its November order, but the TOs filed a motion earlier this month to extend the deadline to Jan. 13 for initial responses and Feb. 28 for reply comments because of the holiday season and a compressed time frame. The commission accepted the deadline extension request on Dec. 9.