PJM Files Comments on FERC’s Transmission Planning and Cost Allocation NOPR

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PJM filed comments with the Federal Energy Regulatory Commission on Wednesday, August 17, in response to the agency’s Notice of Proposed Rulemaking on regional electric transmission planning and cost allocation.

FERC’s proposed rule addresses the need for the nation’s energy infrastructure to be more resilient and reliable in preparation for a changing resource mix, while also achieving cost savings for consumers.

In its comments, PJM generally agrees with the fundamental premises underlying FERC’s NOPR, and generally supports FERC’s proposed reforms aimed at requiring more expansive forward-looking, long-term scenario planning to meet transmission needs driven by changes in the resource mix.

“The facilitation of transmission investment will help enhance reliability, reduce power costs, and will address the nation’s changing resource mix,” said Ken Seiler, Vice President – Planning. “PJM agrees that a longer-term, forward-looking approach to transmission planning can help to achieve these goals.”

PJM provides more extensive detail in its broader filed comments (PDF), but in general, PJM believes that a final rule by FERC should:

  • Address enhanced reliability and resilience in intermediate- and long-term transmission planning processes, while maintaining existing processes for short-term reliability and market efficiency planning
  • Strengthen interregional transfer capability in light of the nation’s changing resource mix
  • Include a uniform, nationwide policy regarding a right of first refusal
  • Require that transmission planners use a 15-year long-term transmission planning horizon for scenario development and assessment instead of a 20-year look
  • Examine the additional factors transmission providers should consider as they identify transmission needs driven by changes in resource mix and demand
  • Require transmission providers to develop future scenarios that transmission planners could use to examine reliability trends that could justify grid expansion, while maintaining regional flexibility regarding the number of scenarios to be studied
  • Clarify the process and requirements pursuant to which FERC intends to require transmission providers to specify the criteria by which they will identify and evaluate transmission facilities for potential selection under the proposed long-term planning process
  • Allow for state and stakeholder feedback and input into the development of long-term transmission planning scenarios and cost allocation methodologies for facilities selected pursuant to the new long-term planning process, while clarifying that the NOPR was not intending to force reconsideration of existing cost allocation methods
  • Allow for regional flexibility with respect to the categories of benefits that transmission providers must analyze associated with transmission facilities that address needs driven by changes in resource mix and electricity demand, while also providing for a subset of benefits that should be considered nationwide
  • Avoid an inference that Dynamic Line Ratings and Advanced Power Flow Control devices can serve as long-term substitute solutions to meet system reliability needs
  • Rather than requiring that transmission needs identified in the interconnection queue drive regional transmission planning decisions, use an alternative, more case-specific and flexible approach that builds on and is better synchronized with the interconnection process and market developments, and accommodates topologies as diverse as those in PJM without pinpointing geographic zones with the potential for large amounts of new generation

FERC issued its NOPR on April 21, 2022, which followed the agency’s Advanced Notice of Proposed Rulemaking issued in July 2021. It represents FERC’s most significant action on transmission planning and cost allocation in more than a decade.