PJM presented results of its analysis, “Stability Project Beneficiary Identification Alternatives” to stakeholders and members on Friday morning at a special session of the Transmission Expansion Advisory Committee.
PJM developed the report at the direction of the PJM Board; the board was responding to questions regarding identification of beneficiaries in the Artificial Island project.
PJM said it views the posted analysis as a starting point for all stakeholders, including the states, to review and use in discussing alternative approaches to cost allocation for stability-based projects.
The existing cost allocation methodology (solution-based distribution factors – DFAX – using power flow analysis) appropriately aligns costs and beneficiaries for most transmission projects. However, analysis related to stability projects such as Artificial Island suggests additional beneficiaries may exist.
PJM’s role is to implement the methodology proposed by transmission owners and approved by the Federal Energy Regulatory Commission. The owners of the transmission system have the authority to propose cost allocation formulas, subject to approval by the FERC.
The FERC would determine how to proceed, should there be further discussion of the Artificial Island issues.
While PJM would participate in, and support further discussion of the issues in any proceedings that the FERC might initiate, PJM does not intend to file its analysis or an alternative cost allocation with FERC.
PJM is also not taking a position on the alternatives discussed in the analysis. While the analysis was performed in the context of the Artificial Island project, it is intended to provide transmission owners, the states, and other stakeholders alternatives to the existing cost allocation methodology that might better align with stability projects.