Michigan state commissioner: State’s unique geography should be noted on cost allocation

Michigan’s limited electrical connection to the rest of the Midwest Independent Transmission System Operator should be considered when discussing cost allocation, Michigan Public Service Commissioner Greg White said Oct. 13.

In testimony before the U.S. House Energy and Commerce Committee Subcommittee on Energy and Power, White said the Organization of MISO States, including the MPSC, supports FERC’s effort to induce more interregional transmission planning efforts that will enhance coordination, accountability and oversight between regional transmission organization regions and which will include non-RTO stakeholder consideration and participation.

The MPSC also supports FERC’s inclusion of public policy-driven projects as a category of transmission projects that can be considered in the regional transmission planning process.

White said the MPSC’s concern with FERC Order 1000 is that the method used for determining cost allocation for these transmission projects chosen to fulfill interregional planning is just, reasonable and reflective of the benefits that would be ascribed to Michigan’s unique circumstance.

Furthermore, he said, individual transmission projects should be periodically reviewed in order to allow FERC to strike an appropriate balance between consumer and investor interests.

It is important to recognize Michigan’s unique peninsular geography and its limited electrical connection to the rest of the Midwest Independent Transmission System Operator transmission system, White said, adding that it is likely that Michigan will realize minimal benefits from distant transmission expansion projects constructed in the other 12 MISO states. However, on the basis of electric load, Michigan will be exposed to a disproportionate share of about 20% or more of all MISO’s multi-value projects costs.

Furthermore, the state has enacted renewable portfolio standards and development of these in-state renewable energy projects undermine any claim that Michigan will receive a benefit from the construction of MISO MVP transmission projects intended to transmit electricity from new renewable energy projects in other states.

White also said that the U.S. Department of Energy’s proposal to delegate to FERC the authority to identify and designate national interest electric transmission corridors in which federal backstop siting authority would apply, would cause duplication in transmission planning functions and result in inefficiencies.

Among other things, he said the MPSC believes that DOE’s delegation proposal should be limited to areas where there is a demonstrated need – perhaps such as those geographic regions that do not have RTOs and where FERC finds that such areas have been unable to develop the effective interregional transmission planning protocols envisioned by FERC Order 1000.

About Corina Rivera-Linares 2886 Articles
Corina Rivera-Linares, chief editor for TransmissionHub, has covered the U.S. power industry for the past 15 years. Before joining TransmissionHub, Corina covered renewable energy and environmental issues, as well as transmission, generation, regulation, legislation and ISO/RTO matters at SNL Financial. She has also covered such topics as health, politics, and education for weekly newspapers and national magazines. She can be reached at clinares@endeavorb2b.com.