Planning Committee mulls status of new cost commitment measures


The subject of cost commitment in PJM’s project evaluation process was at the forefront of discussion at the Aug. 9 Planning Committee meeting.

Members decided to delay consideration of cost commitment-related revisions to Manual 14F: Competitive Planning Process, opting instead to vote only on changes to the document related to market efficiency. That new language was endorsed with no objections and one abstention.

The move came after several stakeholders expressed concern that manual language guiding cost commitment that already had been approved by the Markets & Reliability Committee in May was not going to be immediately included in the manual.

Steve Herling – vice president, Planning, explained that while the MRC had approved the inclusion of a comparative framework for consideration of cost commitment, the implementation details need to be completed before the manual will be changed.

“We often develop language before something can be implemented so that people can understand what we’re trying to accomplish,” he said, noting that the language endorsed by the MRC is not being discarded.

“In all likelihood, there will need to be additional language when we finalize the construct, and it will be reviewed against the language that’s already been approved,” Herling said. “We’re diligently working on developing this construct. Until we’re done, we’re not going to know what manual language will look like.”

That construct is a framework being created with input from the independent market monitor to enable PJM to compare the merits of competitive proposals submitted containing voluntary cost commitment provisions.

In a subsequent presentation, Mark Sims, manager – Infrastructure Coordination, said PJM staff already have conducted several meetings with the IMM, and more are planned.

“The biggest task we’ve had is figuring out: How do we get from all the template data to an actual framework where we can compare Project A to Project B?” he said. “Cost is just one component.”

Project cost is complex, he said, and the framework under discussion is not being designed to boil it down to just one number. There are qualitative and quantitative data – including risk, performance and feasibility – underpinning costs.

The end result will be a range of potential outcomes to be considered.

Just as important as developing a comparative framework that PJM can use to evaluate projects is ensuring the process is transparent and able to show stakeholders how projects were evaluated and compared.

The Planning Committee can expect monthly progress updates.

In other business, members used the voting application for the first time in Planning Committee voting for an issue to be resolved by the committee.

The group used it to endorse a proposal from the Market Efficiency Process Enhancement Task Force. It passed with 114 voting in favor, 15 against and 38 abstentions.

In a nonbinding poll held immediately thereafter to compare the proposal with the status quo, 91 votes were favorable, 22 preferred the status quo, and 53 members abstained.

A separate package, sponsored by AEP, also had been listed for consideration, but AEP pulled the item from the agenda before the meeting started.

The committee, with three abstentions, also endorsed changes to Manual 14B: PJM Region Transmission Planning Process, designed to make deliverability procedures more transparent and easier to follow for stakeholders. They also included minor procedural changes.

Also endorsed were changes to Manual 14C: Generation and Transmission Interconnection Facility Construction.

The committee heard first reads on a problem statement and issue charge addressing the ability of inverter-based distributed energy resources – wind and solar connected to the bulk power grid – to “ride through” a system disturbance, or stay connected to the system, so as not to exacerbate system problems.

Revisions to Manual 21: Rules and Procedures for Determination of Generating Capability Changes also were presented on a first read.

The committee received an informational update on proposed changes to the PJM-MISO joint operating agreement planning provisions.

Transmission Expansion Advisory Committee

The TEAC convened following the Planning Committee meeting.

Xu Xu, senior engineer – Market Simulation, updated stakeholders on PJM’s analysis of Stage 1A 10-year auction revenue rights.

PJM observed one internal and eight external infeasible facilities, she said. Expected planning upgrades should mitigate the internal infeasible facility. The others will be reviewed with the PJM and MISO interregional planning groups.

The reliability analysis update reviewed three baseline projects and two supplemental projects.

The scope of one supplemental project in the Dominion Zone has been modified after the Virginia State Corporation Commission approved the project under a newly enacted underground transmission pilot program as part of the Grid Transformation and Security Act of 2018.

The project dates to 2014, when Dominion Distribution requested a new substation at Haymarket to accommodate a new datacenter campus and general growth in the area. The original project scope included 6 miles of overhead double-circuit 230-kV line. The revised project buries half of the line.

The project change moves the in-service date from 2018 to 2021 and increases the cost from an estimated $45 to $57 million to $174 million as a result of the new Virginia legislation.

A market efficiency update also was presented, along with an interregional planning update.

TEAC members also were reminded that the email address is being retired Sept. 1. Stakeholders with questions about planning updates or windows are being asked to use the Planning Community.