Both the PJM Markets and Reliability and Members committees held their meetings Thursday via conference call because of a snowstorm that hit the East Coast the day before. The meetings had originally been scheduled to be held in Wilmington, Del.
Markets and Reliability Committee
Transmission Replacement Vote Deferred Until April MRC
The MRC on Thursday agreed to delay a vote on revised transmission planning rules until April by a sector-weighted vote of 3.73 to 1.27, with the Transmission Owners sector opposed.
Sharon Segner of LS Power asked for a deferral to accommodate further discussion on the language her company crafted for Manual 14B: PJM Region Transmission Planning regarding how supplemental projects are added or removed from the Regional Transmission Expansion Plan. The proposal specifies that a transmission owner’s supplemental project “will generally be removed from the RTEP” if it is rejected by a regulatory agency.
The RTO has suggested a review of the entire process at the Planning Committee in response to LS Power’s proposal. Segner told the MRC that the delay would allow extra time for the PC — through regular or special meetings — to discuss the process in detail, including its relation to FERC Orders 890 and 1000. (See “Holistic Review of RTEP Removal Suggested,” PJM PC/TEAC Briefs: Feb. 7, 2019.)
Segner first presented the proposal during the Jan. 24 MRC meeting as a friendly amendment to a proposal from American Municipal Power to increase transparency of supplemental project planning. PJM accepted most of AMP’s proposal, but it rejected one section that it called an overreach of the RTEP. This seemingly rendered LS Power’s amendment moot, but Segner successfully moved to delay any action on it until Thursday’s meeting. (See PJM Rebuffs Stakeholders on Supplemental Projects.)
NextEra Energy offered a friendly amendment to the LS Power proposal that would require PJM to remove supplemental projects with incomplete siting permit applications from the RTEP. If PJM discovers an RTEP project that would eliminate the need for the proposed supplemental, the RTO would inform all applicable committees and regulatory agencies. Segner said the amendment will become part of the PC discussions in March and April.
Stakeholders Urge Slower Timeline on Fuel Security
Stakeholders told PJM their 12-month timeline for addressing potential fuel security threats and accompanying market rule changes is too aggressive.
PJM’s Mike Bryson solicited feedback from the MRC on a first reading of a problem statement and issue charge centered on ensuring grid reliability during times of extreme stress.
In November, PJM released an eight-page summary of a study that showed the RTO could face outages under extreme winter weather, gas pipeline disruptions and “escalated” resource retirements. The study, which evaluated more than 300 winter scenarios, was a “stress test … intended to discover the tipping point when the PJM system begins to be impacted,” the RTO said. (See PJM Begins Campaign for Fuel Security Payments.)
Bryson said PJM would schedule a vote on the problem statement for the March 21 MRC, with a task force recommendation by September and a FERC filing in December.
“I think it’s prudent for PJM to put a timeline out there,” Bryson said. “I don’t want to go to the opposite extreme and say it’s open ended.”
PJM drafted the problem statement as part of a three-phased approach for ensuring the resilience of its generation portfolio. Staff completed the Phase 1 analysis in December, saying that while no imminent risk currently exists, the RTO should explore proactive, market-based mechanisms for retaining or procuring fuel-secure resources.
A multitude of stakeholders said that while they appreciated PJM’s work on the issue, the timeline Bryson presented was far too short, saying there needed to be more discussions before any recommendation came before the committee.
Paul Sotkiewicz, president of E-Cubed Policy Associates, went further with his criticism.
“What you have done is shown there isn’t an issue here,” said Sotkiewicz, representing Elwood Energy, a 1,350-MW gas-fired generator in Illinois. “I think that’s very important for policymakers to see there is no problem. … We are talking about making market design changes when there is absolutely no evidence that there is a problem with market design.”
He encouraged other stakeholders “not to go down the road” but instead pursue a market-based analysis.
PJM staff gave stakeholders a March 7 deadline for submitting feedback on the problem statement, with an updated draft to be released March 14.
Manual Changes Endorsed
Stakeholders approved the following manual changes:
- Manual 14B: Transmission Planning Process: Cover-to-cover periodic review. Includes changes to section 1A on critical energy/electric infrastructure information (CEII).
- Manual 14D: Generator Operational Requirements: Added requirements to section 7.1.1 regarding generator real power control associated with FERC Order 842, which requires new generators seeking interconnections to be equipped to provide primary frequency response. The new rules apply to generators that entered the PJM transmission queue on or after Oct. 1, 2018. (See FERC Finalizes Frequency Response Requirement.)
- Manual 12: Balancing Operations: Cover-to-cover periodic review with updates to section 3 regarding primary frequency response per FERC Order 842. The changes were endorsed by the Operating Committee on Feb. 5 over the opposition of FirstEnergy and Duke Energy. FirstEnergy challenged the manual’s formula for judging primary frequency response performance. (See “Utilities Question Primary Frequency Response Calculation,” PJM Operating Committee Briefs: Feb. 5, 2019.)
Calculator Vote Placed in ‘Parking Lot’
The MC agreed to postpone a vote on whether to force PJM to accept opportunity costs calculated by the Independent Market Monitor until a member requests it.
Bob O’Connell of Panda Power Funds had proposed Operating Agreement changes last August if PJM refused to accept the Monitor’s calculator in determining generators’ cost-based energy offers.
The proposal passed the MRC in August, which incentivized the RTO and the Monitor to work toward a deal, announced the following month. The MC had postponed a vote at its September meeting to give PJM and the Monitor time to put the new process in effect. (See “PJM, Monitor Come to Agreement on Opportunity Cost Calculator,” PJM MRC/MC Briefs: Sept. 27, 2018.) Under the agreement, the Monitor will explain its inputs and logic to PJM to demonstrate that the unit-specific opportunity costs are compliant with the OA.
O’Connell said the unusual motion puts the issue in a “procedural parking lot,” giving members flexibility to bring up the issue on short notice in case PJM suddenly decided the Monitor’s calculator was no longer valid. Stu Bresler, PJM senior vice president of operations and markets, said staff supported the motion.
Stakeholders to Consider Retiring Wilmington as Meeting Site
Members will vote next month on a proposal by Katie Guerry of Enel X to move all MRC and MC meetings to PJM’s Conference and Training Center in Valley Forge, Pa., instead of splitting them between there and The Chase Center on the Riverfront in Wilmington, Del.
PJM had held all its meetings in Wilmington until it opened the center in 2012, where it began holding lower committee meetings and some MRC/MC meetings. The RTO had historically been centered around the I-95 corridor, and the city was deemed a good midpoint, Dave Anders, director of stakeholder relations, explained to the committee.
Guerry said that the Valley Forge location provides stakeholders cost efficiencies, as they have access to PJM staff and resources while they are there.
Virtually all stakeholders who spoke expressed reluctant support for the proposal, saying that while Valley Forge is harder to get to because of a lack of public transit options, the facility provides a far better meeting experience. Several noted that there are often technical difficulties at the Chase Center — the RTO’s meeting site in Wilmington — with unreliable wireless connections causing delays in voting.
Several others noted that ride-sharing services such as Uber have made up for the lack of public transportation in the area.
Stakeholders were prepared to approve the proposal immediately Thursday, but Guerry said she wanted to give PJM meeting planners time to review the RTO’s contract with the Chase Center, as well as give any on-the-fence members time to think about the issue.
– Christen Smith and Michael Brooks