Advocates for consumers, environment share ideas with PJM Board

Evelyn Robinson, PJM

Fuel security, energy price formation, resilience and demand response were among the topics addressed Monday at the Public Interest and Environmental Organizations User Group meeting with the PJM Board at the PJM annual meeting of members.

Kristin Munsch, president of the Consumer Advocates of the PJM States (CAPS), noted that 23 members, representing 14 out of 16 offices, attended this year. The strong showing, she said, reflects the group’s goal of providing meaningful input to the stakeholder process and maintaining an open dialogue with other members.

Among CAPS’ concerns are constant change, transmission costs, support for the role of the Independent Market Monitor and lack of prioritization of major consumer initiatives, including demand response, she said. She stressed the need to analyze the cost impacts of PJM initiatives on consumers.

Erik Heinle, D.C. Office of the People’s Counsel, weighed in on stakeholders’ work toward principles for evaluating transmission project proposals that include cost commitments. He supported a proposal that would extend cost containment considerations beyond construction costs to return on equity and capital structure.

PJM President and CEO Andy Ott thanked the speakers for bringing up their priorities.

“It’s great that you highlighted prioritization. It’s important to engage with the stakeholder community,” he said. “PJM alone can’t do it – we need to do it as a PJM community.”

CAPS interspersed its presentation with comments from representatives of environmental groups.

Competitive markets should lower costs and create more choice, they said, but they worried that some PJM initiatives – including capacity repricing, energy price formation and fuel security – would raise costs.

Jennifer Chen, Sustainable FERC Project, addressed the tariff-mandated quadrennial review of Variable Resource Requirement (VRR) Curve in the capacity market. She supported a recommendation to use combined-cycle units as the reference resource to determine the VRR Curve. PJM has procured more capacity than necessary over the past several years, she said.

Mark Kresowik of the Sierra Club discussed assumptions PJM might use in the fuel security study. He stressed the importance of seeking stakeholder comments at the beginning of the process. (PJM already is encouraging feedback as it starts the study.)

Jackie Roberts, West Virginia consumer advocate, said resilience discussions should focus more on the distribution system. Resilience, she said, is not energy price formation or fuel security.

Ott agreed that the system currently is reliable and resilient. But, he said, the key is looking toward the future.

“At what point, if any, do we become too dependent on one set of infrastructure?” he said. “Our fuel security study that we’re embarking on attempts to answer that question.”

Even with current and announced retirements, PJM does not have a fuel security issue, he said.

“However, 10 years from now, it’s a legitimate question for us to analyze and engage the stakeholders and say: As a region, what should be established as fuel security standards? It’s the right thing to do.”

Bill Fields, Maryland Office of People’s Counsel, expressed concern over barriers to consumer participation in demand response programs.

John Evans closed out the session, sharing a little about the Pennsylvania Office of Small Business Advocate – the only such office in the country. He discussed cybersecurity and funding uneconomic nuclear plants to keep them from retiring.