Panelists discuss challenges in implementing FERC Order 1000

Former FERC Commissioner Philip Moeller on Feb. 10 said that he wishes there had been more of an emphasis in FERC Order 1000 on interregional projects between RTOs – between regions – and probably less emphasis on intraregional projects.

As noted on FERC’s website, the order reforms FERC’s electric transmission planning and cost allocation requirements for public utility transmission providers; it builds on the reforms of Order 890 and corrects remaining deficiencies regarding transmission planning processes and cost allocation methods. FERC in June 2010 issued a notice of proposed rulemaking seeking comment on potential changes to its transmission planning and cost allocation requirements, the website noted.

In response to a question about Order 1000 that was asked during the Americans for a Clean Energy Grid’s National Electric Transmission Infrastructure Summit, which was held in Washington, D.C., Moeller said, “[H]ere it is, seven years later, almost, and I don’t think you’d find a lot of people who would call it a great success, and it’s been extraordinarily hard to implement.”

That said, there are some benefits from regional planning, but there would have been more if there had been more emphasis on interregional projects, said Moeller, who is senior vice president, Energy Delivery, and Chief Customer Solutions Officer, Edison Electric Institute.

He noted that more of an emphasis on interregional projects would have been more beneficial to customers, particularly on congestion issues between regions.

He said that he voted for the order, and dissented in part, and noted that “if you vote against an entire order, you take yourself out of all the negotiations going forward on further iterations.”

Also speaking on the “Session IV: The long haul: Affordable, reliable, sustainable power for everyone” panel was John Moore, director, Sustainable FERC Project, Natural Resources Defense Council, who said that Order 1000 “didn’t really change planning that much in the RTOs. I mean, they were already doing their Order 890 regional planning.”

He said that PJM Interconnection, ISO New England, the Midcontinent ISO, New York ISO and California ISO “didn’t see Order 1000 as requiring any significant new intraregional planning, and so what was left was the interregional [planning], and FERC was very careful … about not wanting to order interregional planning because I think FERC felt that that was one step away from requiring interconnection-wide planning, which would had then probably bring in some” opposition from entities that are in non-RTO regions.

“They’re still in planning regions and Order 1000 applies to the entire country, but there is a marked difference in the way that planning is done between the consolidated balancing authorities of the RTOs and the non-consolidated balancing authorities in those other Order 1000 regions,” he said.

Panelist Carol Battershell, acting director, Office of Energy Policy and Systems Analysis, U.S. Department of Energy (DOE), said that one of the things noted in the first Quadrennial Energy Review (QER), which was rolled out in April 2015, “was we didn’t really know as much about how [Order] 1000 was working and that some additional analysis would be useful. We started that analysis and we used some of it then in the second QER.”

As TransmissionHub reported, the second installment of the QER – also referred to as QER 1.2 – was released on Jan. 6. Former President Barack Obama in June 2013 initiated a quadrennial cycle of energy reviews to provide a multi-year roadmap for U.S. energy policy, as noted in the QER 1.2. Obama, in a presidential memorandum released in January 2014, directed his administration to conduct a QER, and announced the formation of a White House Task Force to develop the QER. The QER 1.2 also noted that Obama further directed DOE to provide analytical support for the QER and to help manage the interagency process through a secretariat at DOE.

According to the QER 1.2, differing regional approaches to meeting Order 1000 principles for cost allocation – particularly the definition of “beneficiary” – have made the implementation of Order 1000 complex. The implementation of Order 1000 regional cost allocation principles is relatively new, so it is hard to assess the effectiveness of the process to date in achieving public policy goals, the QER 1.2 said. Going forward, more systematic monitoring of activities and systematic data collection will be needed to assess whether Orders 890 and 1000 are achieving their goals, the QER 1.2 said.

Under “key crosscutting recommendations to support the security and reliability of the electricity system,” the QER 1.2 listed supporting “improved regional and interregional transmission planning processes.”

The objective of Order 1000 is to identify methods and approaches that enable the selection of the “best” set of transmission facilities, the QER 1.2 noted.

Since implementation of the order is in the early stages and no systematic monitoring system is in place, the QER 1.2 said that it is not possible to assess whether its requirements are having their intended effects. Success would mean that transmission planning and cost allocation would be effectively supporting transmission, while also reducing costs, sustaining or improving reliability, reducing congestion, and/or meeting transmission needs driven by public policy requirements, the QER 1.2 said.

Further coverage of this, and other sessions of the summit, will be published soon on TransmissionHub.com.

About Corina Rivera-Linares 3054 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.