Page 1168 – RTO Insider

November 22, 2019

NERC Standards Committee Briefs: Nov. 20, 2019

The standards drafting team revising the requirements for determining and communicating system operating limits (SOLs) told the Standards Committee on Wednesday it may have broken an impasse that has slowed progress and expects to post the standard for industry comment by February 2020 (Project 2015-09: FAC-010, FAC-011, FAC-014).

SDT Chair Vic Howell said most sticking points have been resolved, but the team is still considering how to deal with the burden placed on industry by the logging and communication requirements relating to SOL exceedance. The team has been working with FERC and industry operators over the last nine months to revise the relevant language and reach consensus with the affected stakeholders.

“We’ve come up with something this morning that we think will address the FERC concerns, as well as those commenters who have been very concerned about the logging and communications administrative burden,” Howell said, without elaborating on the proposed solution.

In response to questions about the collection of industry data to support the SDT’s work, Howell acknowledged that the entities surveyed have been reluctant to share relevant information. As a result, the team created measures to ensure anonymity for the industry participants. In addition, the organizations used a variety of methods to collect and store data, which created challenges with synthesizing information in a useful format.

Some committee members questioned whether the team should make sure it has enough data from all industry players before it posts the proposals for comment next year. However, others noted that this could result in even more delays.

“People would have to put things in place today to start collecting winter [data], and then you’d have to wait for summer, and then you’d have to select a couple of off-peak scenarios. So that really would drag out the process another year,” said Howard Gugel, NERC director of engineering and standards. “Hopefully the drafting team has come up with a solution that … addresses the problem, without having to burden industry with a tremendous amount of data collection and data reporting.”

Consultants Removed from SDT Nominee List

Following a proposal to nominate 10 members to the PRC-005-6 SAR drafting team, Dominion Resources Services’ Sean Bodkin asked that two of the nominees — who, like the others, were not identified by name during the discussion — be removed on the grounds that they were consultants.

“When I go back and look at the policy from last year for including consultants on drafting teams, they’re supposed to add some particular technical expertise or something that the team is lacking,” Bodkin said. “In this case I don’t see … any specific technical expertise that they are adding that the other members of the team do not have.”

NERC Manager of Standards Development Soo Jin Kim said that the nominating team had considered this objection but concluded the two candidates’ backgrounds in generation would provide the team with valuable insights. In addition, one had previous drafting team experience.

Kim said that if the full slate of nominees was not approved, another round of solicitation would likely be needed to fill the two gaps on the team. Committee members saw this as an acceptable way to fulfill the requirements regarding drafting team membership.

“If NERC thinks it can achieve its needs by having an additional solicitation for nominees, that would definitely be my preferred option, rather than adding the two consultants,” said Sean Cavote of Public Service Enterprise Group.

Bodkin’s motion passed unanimously, and all nominees except the two consultants, including the chair and vice chair, were approved.

Impact of New NERC Committee

Gugel updated the committee on the expected results of the NERC Board of Trustees’ decision to merge the Operating, Planning and Critical Infrastructure Protection Committees (See Board O K s Committees Merger.) The merger would create a new body, tentatively called the Reliability and Security Technical Committee (RSTC).

Nominations for the new committee are currently being solicited. The RSTC will have 34 voting members: two each from sectors 1-10 and 12, 10 at-large members, and a chair and vice chair. The existing committees will conduct their scheduled meetings in December and March, with the new body taking over their functions by June.

“Probably the largest impact that has for us is that … the Standards Committee would be going to the RSTC for legal and technical support for SARs, as opposed to … the OC, PC or CIPC [as in the past],” Gugel said. “The standards [creation] process will [also] probably need to be revised to incorporate whatever methods the RSTC would like to set up.”

— Holden Mann

November 21, 2019

OMS to Probe State Policies After Leader’s Exit

By Amanda Durish Cook

The Organization of MISO States will examine the revolving door policies of its member states after its president departed his position earlier this month to take a job with a wind energy trade association.

The move comes in response to Louisiana Public Service Commissioner Eric Skrmetta’s call to create a code of conduct among OMS representatives — all of whom are state utility commissioners — governing how they transition into jobs in the industry they regulate.

“We’re asking for the OMS to consider adopting a code of ethics or a code of conduct policy,” Skrmetta told fellow regulators during a Board of Directors meeting Nov. 19 as part of the National Association of Regulatory Utility Commissioners’ annual meeting in San Antonio.

OMS leaders said the organization will begin the effort by examining state rules on post-employment restrictions before it decides to move forward with developing any policy.

OMS former President Daniel Hall | © *RTO Insider*

Skrmetta said he was raising the issue after former OMS President and Missouri Public Service Commissioner Daniel Hall left both posts to bec o me the central region director for the American Wind Energy Association earlier this month. Skrmetta said he took issue with the fact that there was no downtime before the transition and that the move wasn’t announced ahead of time.

“The turnaround is instantaneous,” he said. “It’s pretty obvious we have to take some steps.”

OMS Executive Director Marcus Hawkins said the board was aware of Hall’s plans to leave the organization about a month before his departure. Hall did not respond to RTO Insider’s request for comment.

“Avoiding the appearance of impropriety is an important goal for this body,” Skrmetta said. He suggested OMS adopt a recusal mechanism or require members to disclose extracurricular tasks that might conflict with the aims of their offices.

Kentucky Public Service Commissioner Talina Mathews suggested OMS begin the effort by taking inventory and comparing each state’s existing code of ethics on post-employment policies, a task the board assigned to an informal board subcommittee.

But even that first step prompted pushback from other regulators.

Wisconsin Public Service Commissioner Mike Huebsch said he wasn’t certain cooling-off periods are constitutional. He argued requiring cooling-off periods negatively affects former commissioners’ ability to find jobs after their terms end, an already daunting task.

“It’s a tough thing because most of us can’t talk to anyone until we leave the state,” Huebsch said.

“There had to be some knowledge of the employment coming. … There has to be some acknowledgement that that’s going to happen, and there has to be some kind of drawing back,” Skrmetta responded.

Skrmetta said initiating a code of conduct would create protections for OMS and create an “absolute armor plate” for the organization. He also argued that as AWEA’s central region director, Hall was active in MISO states immediately after leaving OMS.

“Daniel Hall took certain views in his office, and those views haven’t changed. There was no influence,” Arkansas Public Service Commission Chairman Ted Thomas argued. “You can talk about motivations, but you can’t really separate it.”

Thomas suggested OMS might add some boilerplate language that directors are bound to their state’s individual code of ethics.

But Huebsch said state law and guidelines differ so drastically among states it would be impossible to create a single code of ethics for members.

“There are things I could do in other states that would put me in jail in Wisconsin. And vice versa,” he said.

OMS President Matt Schuerger asked the subcommittee to wrap up its research in time for the board’s January meeting.

“It’s a reasonable question that’s been put before us,” he said, promising more discussion.

November 21, 2019

MISO, SPP Regulators Nibble Away at Seams Issues

By Tom Kleckner

SAN ANTONIO — State regulators working to improve MISO–SPP interregional planning processes and seams issues drew more than three dozen interested onlookers to their latest committee meeting on Sunday.

Continuing a trend for much of the last year, the SPP RSC/Organization of MISO States Liaison Committee held its meeting in conjunction with a conference of the National Association of Regulatory Utility Commissioners (NARUC). But that may soon be changing.

During a discussion on timelines, North Dakota Commissioner Julie Fedorchak echoed the frustration of several members when she said, “We don’t move quickly enough.”

Kansas Corporation Commissioner Shari Feist Albrecht, who leads the SPP side of the committee, agreed the group’s progress is slow, hampered in part by insufficient face-to-face time between the RSC and OMS members.

“It’s moving too slow,” she said. “I’m hoping we can develop a regular schedule of meetings going forward.”

MISO SPP — Commissioners Ted Thomas, Arkansas, and Shari Feist Albrecht, Kansas, lead the discussion. | © *RTO Insider*

The committee intends to rectify that situation by scheduling at least one meeting in early 2020, albeit possibly through the web, for an education session on SPP’s and MISO’s planning processes before NARUC’s next meeting.

FERC Commissioner Richard Glick was among those who sat in on the Nov. 17 meeting, being granted a seat at the table while others lined the walls. He declined to offer comments during the discussion but did address the session two days later during NARUC’s annual meeting.

“I appreciated being invited. It was a very interesting discussion,” Glick said during a Q&A session with outgoing NARUC President Nick Wagner. “It’s pretty apparent that we’re not necessarily building the transmission system that might be needed for the grid of the future. We’re not going to resolve those issues today. If we can do a better job of planning between regions, that would really be helpful.”

Three separate coordinated studies between the ISOs have failed to yield a joint project. Stakeholders have laid much of the blame on differences in modeling and criteria between the grid operators, which has led to market inefficiencies. (See MISO, SPP to Ease Interregional Project Criter i a.)

While meeting irregularly since last year’s creation, the liaison committee has gathered stakeholder feedback and commissioned the RTOs’ market monitors to analyze the seams issues. (See RSC, OMS Approve Moni t ors’ Seams Study.)

SPP’s Market Monitoring Unit finished a draft report on rate pancaking and unreserved transmission use in time for the meeting.

MISO’s Independent Market Monitor is scheduled to wrap a study on joint dispatch before year’s end. The IMM is also working on suggested changes to the market-to-market framework with the SPP-MISO joint operating agreement. The latter report may not be finalized until spring 2020.

The MMU’s analysis indicated removing duplicate transmission charges (rate pancaking) has a very limited effect on import and export volumes. The SPP Monitor said most transactions are “inelastic” to the market-clearing price and the majority of these transactions are already taking advantage of market import service in the SPP footprint and a comparable service in MISO.

Its study of SPP unreserved use charges since 2016 revealed they are unaffected by the SPP-MISO seam. The MMU said it could not quantify an impact of these charges on interchange volumes and “abstained” from providing an opinion on the current processes.

The work that lies ahead prompted Dana Murphy, chair of the Oklahoma Corporation Commission, to ask for clarification on just who various studies’ stakeholders are?

“My concern in general is who is asking the RTOs to do this background work?” Murphy said. “We have to be thoughtful in our communicating and what we are communicating.”

November 21, 2019

New Jersey Doubles OSW Target

By Christen Smith

New Jersey doubled its offshore wind goal on Tuesday, committing the Garden State to develop 7,500 MW of generation by 2035 in hopes of becoming the “nexus of the global offshore wind industry.”

Gov. Phil Murphy, flanked by First Lady Tammy Murphy and former Vice President Al Gore, signed the executive order at the Liberty Science Center in Jersey City — the latest development in the state’s march toward 100% clean energy by 2050.

“There is no other renewable energy resource that provides us with either the electric-generation or economic-growth potential of offshore wind,” Murphy said. “When we reach our goal of 7,500 megawatts, New Jersey’s offshore wind infrastructure will generate electricity to power more than 3.2 million homes and meet 50% of our state’s electric power need.”

New Jersey offshore wind — Offshore wind | *Avangrid*

In June, the New Jersey Board of Public Utilities selected Ørsted to develop the first 1,100 MW of offshore wind planned for the state. (See Orsted Wins Record OSW Bid in NJ.) Regulators will solicit bids for two more 1,200-MW projects in 2020 and 2022.

“As our federal government abdicates its responsibility to confront the climate crisis, our transition to a clean energy future is being led by states like New Jersey,” Gore said. “Today’s announcement couldn’t be more timely and more needed, as climate-related extreme weather events continue to wreak havoc on our communities. With this executive order, Governor Murphy is unleashing the unprecedented economic and job creating opportunities of clean, wind energy.”

The projects represent just a fraction of the potential researchers say offshore wind development holds along the Mid-Atlantic coast. University of Delaware Professor Willett Kempton said in April his analysis concludes a hypothetical buildout from New Jersey to North Carolina could add as much as 80 GW to the grid. (See Big Prospects for Offsh o re Wind in PJM.)

Companies, however, struggle with the logistics of building offshore wind generation in PJM. Anbaric Development Partners asked FERC on Monday to order the RTO to allow developers of offshore transmission “platforms” to obtain injection rights, saying PJM’s Tariff violates the commission’s open access requirements and is discriminatory. (See Anbaric Seeks FE R C Help on OSW Tx.)

The transmission developer said it was forced to file its complaint after a stakeholder initiative to consider changing PJM’s rules stalled in September. (See “PJM Recommends Sunsetting Offshore Wind Special Sessions” in PJM PC/TEAC Briefs : Sept. 12, 2019.)

Liz Burdock, CEO of the Business Network for Offshore Wind, said up to 8,240 MW of offshore wind projects are currently under development on the East Coast, with “steel in the water” promised by 2026. New Jersey’s latest commitment will further encourage investment in the industry’s component manufacturing inside the U.S. — a major boon for the national economy.

“This additional 3,500 MW will accelerate the development of the state’s offshore wind industry and supply chain, and will translate into more economic opportunities, and more jobs, up and down the New Jersey coastline,” she said.

November 21, 2019

RC West Oversight Committee Briefs: Nov. 19, 2019

Having become reliability coordinator of record for much of the West on Nov. 1, CAISO’s RC West is now taking on new responsibilities as time error and geomagnetic disturbance (GMD) monitor for the Western Electric Coordinating Council.

“The transition [to RC of record] went very smooth,” Tim Beach, director of RC West operations, said Tuesday during a meeting of the RC West Oversight Committee. “We have not had any real events happen since then, so that’s good.”

“The communications with [balancing authorities] and [transmission operators] have been strong,” Beach added, noting that the RC now conducts a daily conference call with the Northwest region in addition to the one CAISO has held for the Southwest for years. The calls, which deal with path deratings, interconnection reliability operating limits (IROLs), major facility outages and remedial action scheme (RAS) outages, if they take place, “keeps everybody on the same page,” Beach said.

“It’s new to the folks in the Northwest. And a lot of times there isn’t a lot of discussion on these calls so there’s a question of value. But we are going to continue that call through the end of the year and we’ll reevaluate the process,” he continued. “We’ll always have some sort of call with regard to that because we do need to communicate those IROLs and path derates.

Beach said NERC became time error monitor for WECC at 10:30 a.m. on Nov. 18. “We haven’t had a manual time error for reliability reasons in the West in quite some time and frankly we don’t see that happening, but we have the process in place if it were to occur,” he said.

RC West will take its turn as the GMD monitor on Dec. 3 when SPP becomes RC of record for the remaining Peak Reliability area. It will serve in the role through 2020, with BC Hydro RC (BCRC) becoming the monitor for 2021. Transitions under the rotation, which will also include SPP and Alberta Electric System Operator, will occur at the same time as the Eastern Interconnection makes its switches, Beach said.

Proposed Metrics

Dede Subatki, director of operations engineering services, told members the deadline is Nov. 29 for comments on RC West’s proposed data metrics.

RC West has proposed continuing Peak Reliability’s practices of releasing some data publicly (such as state estimator quality and convergence) and keeping other data (e.g., load forecast accuracy) confidential.

The Real-Time Working Group will meet Dec. 5 to discuss the comments and Dec. 19 to finalize the metrics, with plans to start gathering data Jan. 1.

“I have a little bit of concern about whether [state estimator] quality should be public at this point given our confidence in it,” John Nierenberg of Tacoma Power said when Subatki opened the floor to comments.

Subatki said the public release would be a “generalized SE quality metric” for the RC West footprint. SE data for individual transmission operators, he said “is definitely confidential.”

That appeared to satisfy Nierenberg. “If we look at an overall generic [metric] maybe I’m not as concerned,” he said.

EHV Data Pool Closure, PMU Update

Officials warned members that companies needing to pull historical data from Peak must do so before Dec. 3, when it will shut down its IT infrastructure, including its EHV Data Sharing Pool. It is being replaced by the new Western Data Sharing Pool (WDSP), which has been available since the end of October.

“The deadline is something that is beyond our control and is something that is not negotiable,” said Subatki. “I think it’s really important to get through the denial phase that some people think we can actually extend this beyond Dec. 3.”

Beach provided an update on the transition to the new Western Interconnection Synchrophasor Program (WISP), saying nine entities, including RC West, SPP, and BC Hydro have completed the transition with six others having completed circuits and ready for the cutover. PacifiCorp, Los Angeles Department of Water and Power and Tucson Electric Power are not yet ready.

Change to Leadership Terms

The committee agreed to eliminate staggered terms for its leadership to fix an unexpected problem.

Under the change, Chair Michelle Cathcart and Vice Chair Kristie Cocco will serve their terms through May 2020 instead of the original plan to have their terms end in March.

Cathcart, vice president of transmission system operations with the Bonneville Power Administration, was elected along with Vice Chair Steve Cobb, director of transmission and generation operations at Salt River Project (SRP), at the committee’s first meeting in March 2019.

Because Cobb is retiring at the end of the year, the committee at its last meeting elected Cocco, of Arizona Public Service, to replace him.

In June 2020, both the new chair and new vice chair will begin two-year terms.

“We realized that because we had said there were staggered terms, it made it so that the vice chair couldn’t become the chair because their term would be in the middle when the chair’s term started,” explained Cathcart. “Given the timeframe and making sure that Kristie has a little bit of time under her belt before she actually becomes chair, we thought that making the change in June would … give her a little bit of time. And then hopefully we can stay on a June schedule from here on out.”

Cathcart clarified after the meeting that “while Kristie is a strong candidate for chair at that point, there will be an election of both chair and vice chair.”

The committee also approved a resolution of appreciation for Cobb, who is retiring after almost 40 years with SRP.

Schedule

The committee will hold a webinar Dec. 17, at which it will review the wind down of Peak. The committee will meet quarterly or as needed in 2020. Meetings are currently set for: Feb. 27 (webinar); May 12 (in person and webinar); Aug. 19 (webinar) and Nov. 12 (in person and webinar).

– Rich Heidorn Jr.

November 20, 2019April 16, 2025

PG&E Seeks to Escape Inverse Condemnation

By Hudson Sangree

Pacific Gas and Electric tried to convince a federal bankruptcy judge on Tuesday to help it escape inverse condemnation — the bane of California’s investor-owned utilities that holds them strictly liable for wildfires ignited by their equipment.

The move may have been a Hail Mary pass, however. PG&E and other IOUs have tried and failed for years to convince judges, lawmakers and state regulators that inverse condemnation isn’t fair because it holds them accountable even if they weren’t negligent.

So far, the IOUs haven’t made much of a dent in the age-old doctrine, which is embedded in the state constitution and applies to regulated monopoly utilities, according to the state appellate courts. The rationale is that because the utilities can exercise eminent domain to seize private property — to create power-line easements, for example — they are liable for damage to private property from their equipment.

The doctrine dates to the mid-1800s when California was trying to rein in the power of the Southern Pacific Railroad.

The Camp Fire, ignited by PG&E equipment, killed 85 residents and wiped out the town of Paradise on Nov 8, 2018. | NASA

This time, PG&E decided to try a somewhat different approach with U.S. Bankruptcy Court Judge Dennis Montali, who is overseeing the utility’s immense Chapter 11 reorganization in San Francisco. The company faces billions of dollars in liability for wildfires in 2017 and 2018 started by its equipment, including the Camp Fire, the deadliest and most destructive wildfire in state history.

Despite a number of court rulings to the contrary, PG&E’s attorneys argued Tuesday that inverse condemnation applies only to public entities and that the utility is not a public entity.

The spreading around, or socialization, of the costs of a wildfire works with a municipal utility, such as the Los Angeles Department of Water and Power, because the utility can raise its own rates to cover costs, PG&E lawyer Kevin Orsini told the judge. But PG&E and other IOUs depend on the California Public Utilities Commission to set rates, and regulators will only authorize wildfire-cost recovery if they find an IOU managed its system prudently, Orsini said.

“Inverse was developed and actually works in the context of a true public entity,” the lawyer said.

A senior mobile home community was destroyed by the Camp Fire in Paradise. | © RTO Insider

In their court filings and presentation, attorneys for wildfire victims called PG&E’s effort a blatant attempt at “forum shopping” after repeated failures in other courts and the State Capitol.

“PG&E has spent the past year complaining about the fact that it is subject to inverse condemnation liability under California law and furiously lobbying to change the law,” the victims’ lawyers argued in their brief. “Because its lobbying efforts have not met with success, PG&E now asks this court to do what California’s political branches have been understandably unwilling to do: bail out the utility from having to fully compensate the victims of fires caused by its equipment.”

Montali seemed to dislike PG&E’s suggestion that his judgment should overrule the state courts or the decisions of lawmakers. PG&E tried to convince lawmakers to modify inverse condemnation as recently as this summer without making much headway, he noted. (See Calif. Wildfire Relief Bill Signed After Quick Passage.)

“The California legislature all of three months ago decided not to change the law,” Montali said. “If that isn’t a significant marker, I don’t know what is.”

PG&E also argued that the application of inverse condemnation to IOUs might still be subject to review by the state Supreme Court, and they asked Montali to make findings to pave the way for an appeal.

Montali, however, said he doubted most of the high court justices would substitute their judgment for that of the legislature.

Montali said he would try to quickly issue a written ruling on the matter.

November 20, 2019February 13, 2025

Danly, Brouillette Advance to Senate Floor

By Michael Brooks

The Senate Energy and Natural Resources Committee on Tuesday voted to advance to the full Senate the nominations of James Danly as a FERC commissioner and Dan Brouillette as secretary of energy.

Danly passed the committee 12-8. Except for ranking member Joe Manchin (D-W.Va.), all Democrats — and independent Sens. Bernie Sanders (Vt.) and Angus King (Maine), who caucus with the party — voted against Danly, currently FERC general counsel.

Before the vote, Manchin bluntly said that “what the White House has done is wrong,” referring to President Trump declining to pair Danly’s nomination with that of Allison Clements, clean energy markets program director for the Energy Foundation and the Democrats’ choice for the party’s open seat on the commission. (See Danly Sails Through Hearing as Democrats Huff.)

“I will not withhold my vote for Mr. Danly, because then I’d be no better than they are,” Manchin said.

“I’m going to continue to implore the White House to give us a working FERC,” he said at the end of the meeting.

FERC General Counsel James Danly (left) and Deputy Energy Secretary Dan Brouillette at their respective confirmation hearings. | © RTO Insider

Brouillette, currently deputy secretary of energy, enjoyed more bipartisan support, passing 16-4. Sanders and Democratic Sens. Ron Wyden (Ore.), Mazie Hirono (Hawaii) and Catherine Cortez-Masto (Nev.) voted against him. (See Brouillette Poised to Become Energy Secretary.) Cortez-Masto cited the Energy Department’s secret shipment of plutonium to Nevada from South Carolina last year as the reason for her vote.

“My vote today is a vote of concern about the Department of Energy’s relationship with the state of Nevada. I am hopeful that it improves,” she said. “I hope I am wrong in my vote today: that Dan Brouillette will step up and work with the state of Nevada [and] will come back and earn the trust of Nevadans.”

The committee also advanced several bills to the floor at its meeting, including:

S. 876, which would amend the Energy Policy Act of 2005 to require the secretary of energy to establish a program to prepare veterans for careers in the energy industry, including the solar, wind, cybersecurity, and other low-carbon emissions sectors or zero-emissions sectors;
S. 2368, which would amend the Atomic Energy Act of 1954 and EPAct05 to support licensing and relicensing of certain nuclear facilities and nuclear energy research, demonstration and development; (Hirono voted against this bill.)
S. 2 5 08, which would require the secretary of energy to establish a council to conduct a survey and analysis of the employment figures and demographics in the energy, energy efficiency and motor vehicle sectors of the U.S.;
S. 2556, which would amend the Federal Power Act to provide energy cybersecurity investment incentives, and to establish a technical assistance program for cybersecurity investments; (See Senate ENR Seeks $250M for Utility Cyb e r Spending.)
S. 26 5 7, intended to support innovation in advanced geothermal research and development;
S. 2 668, which would establish a program for research, development and demonstration of solar energy technologies;
S. 2 688, which would amend EPAct05 to establish an Office of Technology Transitions;
S. 2 7 02, which would require the secretary of energy to establish an integrated energy systems research, development and demonstration program; and
S. 2 7 14, which would amend the America COMPETES Act to reauthorize the Advanced Research Projects Agency – Energy program.

The bills passed by voice vote with no discussion, with much of the committee’s nearly two-hour meeting devoted to debating land-use and parks bills. Sen. Mike Lee (R-Utah) voted against all of the above bills.

November 20, 2019

Senators Ask ISO-NE to Heed States on Clean Energy

By Michael Kuser

Seven U.S. senators from New England on Monday urged ISO-NE to “return to the table with stakeholders” and more closely align its fuel security initiative with state policies seeking to speed the transition to renewable energy resources.

In a letter to the RTO, the senators criticized ISO-NE for “pursuing a patchwork of market reforms aimed at preserving the status quo of a fossil fuel-centered resource mix” and having “charted its own path forward and pursued unpopular initiatives” such as Competitive Auctions with Sponsored Policy Resources (CASPR) and the Inventoried Energy Program.

“ISO-NE should heed the call of the states, electricity generators and others to expand the dialogue beyond the current, too narrow fuel-security reforms to tackle the region’s pressing need to achieve the states’ ambitious climate goals,” they said. “To achieve these goals, ISO-NE should dedicate significant planning and markets resources in the coming months to evaluate, help develop and propose new electricity market structures that recognize, facilitate and are compatible with state policies.”

ISO-NE clean energy — ISO-NE real-time data on Nov. 19 show 60% of the resource mix running on fossil fuels, predominantly natural gas. | *ISO-NE*

The signatories to the letter were Richard Blumenthal (D-Conn.); Ed Markey (D-Mass.); Chris Murphy (D-Conn.); Jack Reed (D-R.I.); Bernie Sanders (I-Vt.); Elizabeth Warren (D-Mass.); and Sheldon Whitehouse (D-R.I.).

State Climate Priorities

Dan Dolan, president of the New England Power Generators Association (NEPGA), said the senators’ correspondence follows two similar letters his organization has sent to ISO-NE in the last year.

“One area where we disagree with the senators’ letter, however, is … NEPGA believes that CASPR provides a viable pathway to integrate state-contracted electricity projects, while maintaining reliable though competitive markets,” Dolan said.

He said there are two important parts to reforming the region’s competitive electricity market to meet the needs of states, consumers and reliability criteria.

“First, state climate priorities should be integrated into the market through a meaningful price on carbon dioxide emissions on an economy-wide basis,” Dolan said. “This will both help support investments in clean electricity supplies, while also helping to drive needed electrification of the transportation and heating sectors, which together account for over two-thirds of all emissions in New England.

“Second, with large-scale state contracts driving increases in resources like offshore wind, the markets must be reformed to account for the changing nature of the electricity supply mix. The existing market design does not sufficiently value the performance that will be required to maintain reliability and resilience,” he said.

Collaborative Tradition

ISO-NE spokesperson Matt Kakley countered that the RTO is already heading in the direction advocated by the senators, including a move to allocate staff time and resources next year for stakeholder discussions on the future of the region’s power system — a measure set out in ISO-NE’s Annual Work Plan for 2020 presented to stakeholders in September.

“Over the past decade, ISO New England has worked tirelessly to incorporate renewable resources into system operations, short- and long-term planning procedures, and the region’s wholesale markets,” Kakley told RTO Insider. “These efforts have allowed the region to add thousands of megawatts of renewable energy, while maintaining reliable system operations, and have set New England up well to accommodate future renewable energy development.”

Kakley said those efforts required “countless hours” of stakeholder discussion “leveraging the region’s strong history of collaboration.”

November 20, 2019

RF Briefs GOs/GOPs on 2020 Spot Checks

By Rich Heidorn Jr.

ReliabilityFirst briefed members Monday on spot checks it plans for about 35 generation owners (GOs) and operators (GOPs) in 2020.

Brian Thiry, RF’s manager of operations and planning compliance monitoring, said the spot checks will focus on risks of insufficient long-term and operations planning that were identified in the 2019 and 2020 NERC Compliance Monitoring and Enforcement Program implementation plans. These include inadequate models, failure to report generator capabilities, resource adequacy and the ability to ride through grid disturbances.

Entities receive notice of the spot check five weeks in advance of when RF needs the evidence. During the first three weeks, the entity works with the RF team lead on collecting sampling data. “The team lead is there to help you — to walk you through the process,” Thiry said during RF’s monthly compliance call.

Some of the entities are subject to spot checks because of compliance oversight plans from audits in the last several years. For others, the notices are “unanticipated and unexpected,” he said.

Solar farm outside Indianapolis International Airport. ReliabilityFirst will be conducting spot checks on generators to address concerns over the increase in renewables with inverter-based relays. | © *ERO Insider*

PRC, MOD, VAR Standards

Auditors testing GOs on PRC-019-2 R1 and PRC-024-2 R1 and R2 will review implementation plans, check to see whether all required testing was performed and whether the generator will trip in the “no trip” zone. They will test compliance with MOD-025-2 R1 and R2 by reviewing implementation plans and testing, and ensure there are no gaps in the information requested by transmission planners.

GOPs will be evaluated on VAR-002-4.1 R2. Auditors will be evaluating internal controls on situational awareness, alarming, notifications and training, and conducting sampling to ensure generators are operating within their voltage schedules.

“These are some of our most frequently violated requirements [for generators] over the last two years or so” as the generation mix has changed with the increase in renewables with inverter-based relays, Thiry said. “Even though [there’s] less … penetration in the Midwest, we still want to stay ahead of this risk.”

Thiry described spot checks as “a mini, more targeted audit.”

“It has a lot less moving parts than an audit. During an audit, it’s a longer period. We would take a harder look at your culture and your controls.”

For a spot check of VAR-02, for example, “we don’t look at every single one of your generators for every single day. We’d be looking at a sample scope of certain generators on certain days.”

Thiry suggested GOPs document the reasons for any excursions above or below their bandwidths and provide graphical representations in 10-minute increments.

“A picture’s worth 1,000 words. If it’s something that you could graph, that really helps us out and helps us [conduct] a fast, efficient review, so these spot checks can stay within that two-week time frame.”

Self-reports

Thiry said internal controls should be monitored continuously and that entities should self-report before the spot checks if they failed to meet an implementation milestone or perform required tests.

“We don’t want to wait until the spot check notification letter comes out to identify an issue. Because whatever this issue is, it can be identified, addressed and mitigated now. We don’t have to wait five months to put a control or mitigating plan in place,” Thiry said. “If you self-report it now, we can get to the bottom of it, [and] work with you on the fixes and the mitigation. And you get the credit for identifying it on your own without us having to find it.”

Thiry said self-reports should include the root cause of the problem. “That helps [enforcement] identify the extent of condition and what other risks may exist,” he said.

Thiry said he would provide additional communications on the spot checks during future reliability calls or in the RF newsletter.

November 19, 2019

PJM Taps Ex-Direct Energy Exec as New CEO

By Christen Smith and Rich Heidorn Jr.

PJM on Monday named former Direct Energy executive Manu Asthana as its choice for president and CEO, ushering in a new era of leadership at the RTO after a tumultuous year of internal reorganization and executive departures. He will join PJM on Jan. 1.

“We welcome Manu to lead PJM into the future,” PJM Chairman Ake Almgren said in a press release. “The electric industry is rapidly changing and PJM needs to continue to evolve. Manu comes to PJM with a wealth of experience from the electricity value chain and we are confident that he will bring new and important perspectives to the organization.”

Asthana’s two-decade career in the energy industry includes a stint as TXU Corp.’s chief risk officer and overseeing both power generation operations and energy trading for Direct Energy, a subsidiary of U.K.-based Centrica.

As president of Direct Energy Home in North America from 2015 through 2018, he led a staff of more than 2,600. The company, which offers retail electricity, home warranties, HVAC services and appliance rentals, claims to serve 3.4 million residential and small business customers in the U.S. and Canada.

Almgren said Asthana’s expertise will enhance PJM’s engagement with members and policymakers. Asthana has a bachelor’s degree in economics from The Wharton School at the University of Pennsylvania.

Asthana, his wife, Aparna, and their family will relocate to the Philadelphia area from Texas, where he served on the boards of Texas Children’s Hospital, the Houston Food Bank and Child Advocates.

Year of Change

PJM’s year of change began in February when longtime CFO Suzanne Daugherty announced her retirement amid the RTO’s overhaul of its credit policies and financial risk procedures following the default of GreenHat Energy.

Daugherty found herself the target of PJM members’ ire after GreenHat amassed 890 million MWh of financial transmission rights while putting up only $600,000 in collateral.

PJM — Manu Asthana (right) and then-Direct Energy CEO Badar Khan, (left) announce a $5 million donation to Texas Children’s Hospital in 2015. | *Direct Energy*

Her retirement was announced by CEO Andy Ott, who himself retired in May, two months after an independent probe into the GreenHat debacle concluded PJM staff ignored red flags about the company’s assets and exhortations from other members about the portfolio’s financial shortcomings. (See ‘Na i ve’ PJM Underestimated GreenHat R i sks.)

The executive departures continued after interim CEO Susan Riley stepped in for Ott. In September, Riley announced the resignation of Vice President Denise Foster and the restructuring of the State and Member Services Division that she had headed. Foster had no role in the GreenHat episode. (See Stakeholders, States in Dark over PJM Personnel Moves.)

Last week, General Counsel and Senior Vice President Vince Duane resigned after more than 16 years “to pursue other opportunities.”

Almgren said Riley will resume her position with the board once Asthana assumes his role next year.

“We highly appreciate Sue Riley for her leadership during this challenging time,” he said. “She has been working with PJM management, members and policymakers in dealing with the many issues at hand at PJM and has laid a strong foundation for Manu to build on going forward.”