By Tom Kleckner
LITTLE ROCK, Ark. — Bowing to arguments from the Public Power sector, the SPP Markets and Operations Policy Committee on Wednesday rejected a rule change that would have allowed transmission owners to collect interest in billing disputes, even if they lose.
SPP’s current Tariff language allows a transmission customer to pay the amount it is disputing into an escrow account, where it is held until the dispute is settled. The interest earned on that account is then paid to the winning party.
The proposed change would have allowed SPP to pay the disputed amounts to TOs while the dispute is underway, and then collect the disputed funds back from the TOs if the customer won its case. However, the customer would not recover the interest.
Attorney Heather Starnes, representing the Missouri Joint Municipal Electric Utility Commission (MJMEUC), said the Tariff change (RR132) would be unfair to transmission customers and would not incent use of the dispute resolution process. She also challenged forwarding disputed funds to non-jurisdictional entities, questioning SPP’s ability to claw back the funds.
“This is a win-win for the TO,” Starnes said. “It gets the disputed funds, gets to use those funds and earn interest on them, and even if the TO loses the dispute, it has still gotten the use of and interest on those funds for the time period in which the dispute is unresolved.”
The measure was opposed by Flat Ridge 2 Wind Energy, MJMEUC and several other public utilities: the City of Independence, Kansas Electric Power Cooperative, Kansas Power Pool, Municipal Energy Agency of Nebraska and the Oklahoma Municipal Power Authority.
SPP supported the revision, saying the changes would align with the Integrated Marketplace’s transmission-settlement process and be easier for staff to administer.
“Administrative efficiency and/or matching up the marketplace and transmission-billing dispute processes are not sufficient justifications for destroying the independent and balanced dispute process currently in place,” Starnes said in her comments against RR132. “SPP having to manage the escrow accounts created incentive for it to work diligently to get disputes resolved.”
“This seems to me to be a solution in search of a problem,” Midwest Energy’s Bill Dowling said.
SPP is one of two RTOs still using FERC’s pro forma tariff language, meaning any revisions to that language must meet a different burden of proof than normal Tariff revisions, Starnes said.
“SPP would have to have proved that RR132 and its process revisions were equal to or better than the FERC pro forma tariff language,” she said.
It was a surprising turnaround. The proposal had cleared the Regional Tariff Working Group in April with only two abstentions.
Only Oklahoma Gas & Electric opposed the MOPC’s rejection of the revision request. There were three abstentions.
Staff assured members that transmission-revenue funds won’t be commingled with Attachment Z2 funds.