PJM, stakeholders discuss response to FERC on resilience

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On Friday at a special meeting of the Markets & Reliability Committee, PJM and stakeholders discussed possible paths going forward in the Federal Energy Regulatory Commission new proceeding (AD18-07) on resilience of the bulk electric system.

FERC’s January order terminated the DOE’s proposed rule on grid reliability and resilience pricing and initiated a new administrative proceeding to examine grid resilience through the grid operators. PJM will file its responsive comments with the FERC by March 9.

Chris O’Hara, vice president and deputy general counsel, reviewed the key points of PJM’s anticipated response to FERC and discussed generally the stakeholder comments that it had received.

Among FERC’s stated goals in the new docket is to develop a common understanding on resilience, including how each RTO/ISO assesses resilience in its geographic footprint. FERC will then use that information to evaluate whether additional FERC action regarding resilience would be appropriate. PJM believes that additional action on resilience is necessary.

“We believe that we have a leadership role in this,” said O’Hara, “but not an exclusive role,” adding transmission owners, states, distribution companies, utilities and other stakeholders are critical to the effort. “Our independence and expertise uniquely positions PJM to perform the [high-impact, low-frequency] risk assessment and qualitative analyses for the region.”

In its filing, PJM will tell FERC that RTOs should have an affirmative role in planning for resilience in the bulk power system and that resilience of wholesale supply is best addressed through RTO markets.

O’Hara said it should not be a surprise to anyone that PJM believes that correct market pricing is a core foundational principal of resilience. Ensuring that the markets are sending the correct price signals will help ensure that generation is compensated based upon its operational attributes in support of reliable and resilient electricity service. Out-of-market or cost-based compensation should be used only under limited circumstances.

PJM will request that the FERC direct PJM to submit additional filings on planning, market reforms, degraded operations and any related efforts that are necessary or appropriate to advance resilience efforts.

When asked why resilience is now suddenly important, O’Hara noted that there are new and different threats and that when coupled with changing system topology, including the changing fuel mix, it is appropriate that PJM examine resilience issues.

“These are all things that lead PJM to step in and identify certain vulnerabilities so that they do not impact safe and reliable operations, or restoration,” he said. “That’s not imprudent and would provide measurable benefits to the system. It’s important to do a few things to make the system more resilient.”

In transmission planning today, the transmission owners identify their most critical infrastructure. RTO planning then looks to ensure that it does no harm, not making the more critical infrastructure worse. Second, the RTO planning should work to eliminate or mitigate infrastructure criticality. Planning for resilience goes beyond transmission planning and may include a larger RTO role in system protection and restoration planning.

In addition, PJM will ask for additional federal leadership on coordination issues with interdependent infrastructure such as gas pipelines. RTOs need better information and cooperation from interdependent systems – principally interstate gas pipelines, local gas distribution companies and telecom providers, as well as water utilities.

O’Hara added that it’s important to note that his presentation contained PJM’s preliminary views and that he anticipated that there would be several work streams going forward.