Southwest Power Pool generally supports FERC Order 1000 and believes that its regional transmission planning, interregional coordination and cost allocation requirements will provide needed investment in transmission infrastructure, Nicholas Brown, SPP president and CEO, said in testimony filed with the House Energy and Commerce Subcommittee Oct. 13.
Though SPP would have preferred additional guidance on interregional cost allocation, Order 1000 is an important step in encouraging greater collaboration among individual transmission owners and transmission planning regions to promote cost-effective investment in needed transmission grid expansion, he said.
SPP supports FERC’s link between cost allocation and transmission planning, and the Order 1000 requirement to adopt regional cost allocation methods that allocate the costs of new transmission infrastructure in a reasonable manner.
Brown also said SPP supports the Order 1000 requirement that transmission providers consider transmission needs driven by federal and state public policy requirements and agrees with FERC’s policy of allowing flexibility in the identification of relevant federal and state public policy mandates and goals.
“While SPP applauds FERC for its efforts to promote greater interregional coordination, we believe that FERC Order 1000 did not go far enough in its interregional cost allocation requirements,” he said.
It would have been appropriate for FERC to authorize interregional cost allocation for transmission facilities located in one region that provide clear benefits for a neighboring region, even if the facility does not cross the regional boundary.
“SPP would have preferred that FERC provide a stronger statement that such projects can and should be eligible for interregional cost allocation when the distribution of benefits warrants such allocation, in recognition of the integrated nature of the transmission system and the broad spectrum of benefits that large-scale transmission facilities provide,” Brown said.
He also said that SPP can modify its construction assignment procedures to comply with Order 1000 and is in the process of doing so, but it would have preferred that FERC adopt an approach that balances RTO member obligations with open participation in the transmission planning process, like the SPP 90-day limited right of first refusal.