FERC Accepts PJM FTR/ARR Compliance Filing

On Jan. 31, the Federal Energy Regulatory Commission accepted PJM’s compliance filing regarding financial transmission rights and auction revenue rights.

The compliance filing made the following reforms regarding Stage 1 ARR resources:

  • Each transmission zone’s Stage One ARR allocation capacity will be capped at the total historical value
  • All historical and replacement resources must be firm network resources
  • Commercial generators can replace retirements across zones
  • Rate-based generators can only replace retirements within a zone
  • Replacements will be based on economics and feasibility

PJM’s compliance filing makes the following reforms regarding balancing congestion:

  • Balancing congestion will include real-time market-to-market payments
  • Balancing congestion will be allocated pro-rata to real time load plus export based on gross demand
  • FTR surplus will be allocated to ARR holders based on ARR credits

The FERC granted PJM’s requested effective dates of Feb. 1, 2017 for the ARR source point issue and June 1, 2017 for the balancing congestion issue.  However, the FERC ordered PJM to submit a further compliance filing by March 2, 2017 to: (1) include details in the Tariff and Operating Agreement around PJM’s process for determining new ARR source points; and (2) remove the requirement that FTR surplus will be allocated to ARR holders.