[Federal Register: September 19, 2003 (Volume 68, Number 182)]
[Notices]
[Page 54897-54899]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr19se03-58]
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DEPARTMENT OF ENERGY
Federal Energy Regulatory Commission
[Docket No. ER03-262-001, et al.]
Order Announcing Commission Inquiry Into Midwest ISO-PJM RTO
Issues
Issued September 12, 2003
Before Commissioners: Pat Wood, III, Chairman; William L. Masseyand
Nora Mead Brownell.
In the matter of: ER03-262-001, ER03-262-004, ER03-262-005,
ER03-262-007, EC98-40-000, ER98-2770-000, ER98-2786-000, EL02-65-
006, EL02-65-000 et al., RT01-88-016; The new PJM Companies:
American Electric Power Service Corp.; On behalf of its operating
companies: Appalachian Power Company, Columbus Southern Power
Company, Indiana Michigan Power Company, Kentucky Power Company,
Kingsport Power Company, Ohio Power Company, and Wheeling Power
Company, Commonwealth Edison Company, and Commonwealth Edison
Company of Indiana, Inc. The Dayton Power and Light Company, and PJM
Interconnection, LLC, American Electric Power Company, Inc., and
Central and South West Corporation, Ameren Services Company,
Illinois Power Company.
1. In various proceedings and at a recent technical conference in
Wilmington, Delaware,\1\ several Midwest and Mid-Atlantic states have
supported efforts by their utilities to increase regional coordination
by joining regional transmission
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organizations (RTOs); other states have opposed or barred these efforts
by the same utilities. The Commission and some of the Midwest and Mid-
Atlantic state commissioners expressed concerns about the current
uncertainty regarding RTO formation in the Midwest and requested
Commission action to resolve this uncertainty. In this order, the
Commission announces an inquiry into RTO issues related to the Midwest
Independent Transmission System Operator, Inc. (Midwest ISO) and PJM
Interconnection LLC (PJM) to be conducted by the Commissioners,
participated in by advisory staff, and facilitated by a presiding
administrative law judge in the above-captioned proceedings. The
purpose of this process is to gather sufficient information for moving
forward in resolving the voluntary commitment made by several entities
to increase regional coordination by joining RTOs and establish a joint
and common market in the Midwest and PJM region. These entities include
American Electric Power Company (AEP), Ameren Services Company
(Ameren), Commonwealth Edison Company (ComEd), Dayton Power and Light
Company (DP&L) and Illinois Power Company (Illinois Power). While these
companies have voluntarily agreed to join either Midwest ISO or PJM,
they have not yet fulfilled their commitments.
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\1\ This regional technical conference was held on August 28,
2003. See Notice on (``continued) Technical Conference dated August
19, 2003, Remedying Undue Discrimination through Open Access
Transmission Service and Standard Electricity Market Design, Docket
No. RM01-12-000.
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2. By taking this action, the Commission intends to explore ways to
resolve the interstate disputes referenced above and enhance regional
coordination to establish a joint and common market in the Midwest and
PJM region.
Background
3. On July 31, 2002, the Commission issued two interrelated orders
\2\ which were designed to help establish a joint and common market in
the Midwest and to support the establishment of viable, for-profit
transmission companies that operate under an RTO umbrella and may,
depending on their level of independence from market participants,
perform certain of the RTO functions in the Commission's Order No.
2000.\3\ In these orders, the Commission approved the voluntary
commitments of certain utilities in the Midwest to either join Midwest
ISO or PJM. Because of the necessity for close regional coordination in
the Midwest, the Commission also required that Midwest ISO and PJM
develop a joint and common market in 2004 that would provide for a
seamless market in the Midwest.
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\2\ Ameren Services Company, et al., 100 FERC ] 61,135 (2002)
and Alliance Companies, et al., 100 FERC ] 61,137 (2002), order on
reh'g, 103 FERC ] 61,274 (2003).
\3\ Regional Transmission Organizations, Order No. 2000, 65 Fed.
Reg. 809 (2000), FERC Stats. & Regs. ] 31,089 (1999), order on
reh'g, Order No. 2000-A, 65 Fed. Reg. 12,088 (2000), FERC Stats. &
Regs. ] 31,092 (2000), appeal dismissed, Public Utility District No.
1 of Snohomish County, Washington v. FERC, 272 F.3d 607 (DC Cir.
2001) (Order No. 2000).
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4. By order issued April 1, 2003,\4\ in Docket No. ER03-262-000, et
al., the Commission conditionally accepted for filing, suspended and
set for hearing revisions to the PJM Open Access Transmission Tariff
(OATT) that would allow AEP, ComEd, DP&L, and Virginia Electric and
Power Company to join PJM. Subsequently, however, the Kentucky Public
Service Commission denied transfer of AEP's transmission facilities to
PJM.\5\ AEP has also asserted that recently-enacted Virginia law
prohibits any firm that is a public utility in Virginia from
transferring ownership or control of, or operational responsibility
over, any transmission system to ``any person'' before July 1, 2004 and
thereafter prohibits such a transfer without prior approval of the
Virginia State Corporation Commission.\6\ At the same time, state
legislation in Ohio and Michigan requires that AEP join an RTO. Also,
by order issued March 15, 2000,\7\ in Docket No. EC98-40-000, et al.,
the Commission conditionally approved the merger between AEP and
Central and South West Corporation (CSW), provided that AEP fulfill its
commitment, set forth in that proceeding, to join an RTO.\8\ The
uncertainty concerning AEP joining PJM has also resulted in uncertainty
in the timing for ComEd and DP&L joining PJM. Requests for rehearing
and compliance filings are pending in these proceedings.
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\4\ American Electric Power Service Corporation, et al., 103
FERC ] 61,008 (2003).
\5\ See Answer of Edison Mission Energy, et al., to Exelon
Corporation's Comments on AEP Responses to FERC Data Requests, filed
August 1, 2003.
\6\ See AEP's Report on Compliance with Transmission-Related
Merger Conditions, filed February 28, 2003 (AEP's February 28
Compliance Report).
\7\ American Electric Power Company,and Central and South West
Corporation, 90 FERC ] 61,242 (2000).
\8\ See Stipulation of American Electric Power Co., Central and
South West Corp. and Commission Trial Staff at 2-4, Docket Nos.
EC98-40-000 et al., (May 24, 1999).
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5. Illinois Power had originally proposed to join PJM. However, it
subsequently has indicated that it may instead seek to join Midwest
ISO. Illinois Power currently does not have an application on file with
the Commission to join either RTO.
6. Finally, Ameren had proposed to join Midwest ISO as part of
GridAmerica LLC (GridAmerica). The Commission has recently received an
application for GridAmerica to join Midwest ISO on October 1, 2003.\9\
However, at that time, GridAmerica would not include the facilities of
Ameren.
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\9\ See Filing by GridAmerica Participants and Midwest ISO dated
August 28, 2003, in Ameren Services Company et al., Docket No. ER02-
2233-010, et al.
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Discussion
7. The Commission will hold an inquiry into RTO issues related to
the Midwest ISO and PJM to be conducted by the Commissioners,
participated in by advisory staff, and facilitated by a presiding
administrative law judge. As noted above, the purpose of this inquiry
is to gather sufficient information to move forward in resolving the
commitment made by several entities to establish a joint and common
market in the Midwest and PJM region.\10\
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\10\ At this time, we intend to focus on the Midwest and the
gaps in the Midwest. Thus, because Virginia Electric and Power
Company is not in the Midwest, we are not including them as part of
this inquiry at this time.
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8. With regard to these utilities, this inquiry will explore the
impediments to these utilities in joining Midwest ISO or PJM and
proposals for resolving those impediments. We note that the uncertainty
regarding the Midwest-PJM participants is delaying the benefits to
customers of greater voluntary coordination among utilities, and thus
hindering the timely development of a joint and common market in the
Midwest and PJM region, and the benefits of reliability that will
result from such a market. Order No. 2000 adopted initially a voluntary
approach to RTO formation which allows capturing reliability benefits,
including regional infrastructure planning.
9. We direct Midwest ISO, PJM, North American Electric Reliability
Council, AEP, Ameren, ComEd, DP&L and Illinois Power to have a senior
company official who can represent these entities as well as make
decisions on behalf of the company present at the inquiry. We invite
representatives from the affected states, including state commissions,
to this inquiry. We invite Canadian parties who will be impacted by the
common market to this inquiry, as well.
10. We direct AEP, Ameren, ComEd, DP&L and Illinois Power to submit
the following information in the form of pre-filed testimony by one or
more witnesses by September 23, 2003: specify the impediments to their
voluntary commitments to join RTOs;
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and propose solutions to these impediments, including Commission
actions necessary to move the process forward to establish a joint and
common market in the Midwest and PJM region in an expeditious manner.
This pre-filed testimony will be subject to cross-examination by the
Commissioners and advisory staff at the hearing specified below. Any
other interested parties may file similar testimony.
11. The inquiry will be held on September 29 and 30, 2003, from
approximately 9 a.m. to 5 p.m. in Hearing Room 1 of the Federal Energy
Regulatory Commission, 888 First Street, NE., Washington, DC 20426. The
Commissioners will attend and participate in the discussions. We direct
the Chief Administrative Law Judge to appoint an administrative law
judge to preside over the two-day inquiry, including swearing in
witnesses, ruling on the admissibility of evidence and objections, etc.
The presiding administrative law judge's involvement will be limited to
the two days of hearing, and the Commission will take appropriate
future action, as early as the October 22, 2003 meeting.
The Commission orders:
(A) The Secretary is hereby directed to publish this order in the
Federal Register.
(B) AEP, Ameren, ComEd, DP&L and Illinois Power are hereby directed
to file the information discussed above by September 23, 2003.
(C) Pursuant to the authority contained in and subject to the
jurisdiction conferred upon the Federal Energy Regulatory Commission by
Section 402(a) of the Department of Energy Organization Act and by the
Federal Power Act, and pursuant to the Commission's Rules of Practice
and Procedure and the regulations under the Federal Power Act (18
C.F.R., Chapter I), the administrative law judge designated by the
Chief Administrative Law Judge, shall preside over this inquiry, as
discussed in the body of this order.
(D) This inquiry shall be held on September 29 and 30, 2003, in
Hearing Room 1 of the Federal Energy Regulatory Commission, 888 First
Street, NE., Washington, DC 20426.
By the Commission.
Magalie R. Salas,
Secretary.
[FR Doc. 03-24086 Filed 9-18-03; 8:45 am]
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