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News Digest

Fortnightly Magazine - July 15 2001

costs, but only when they mitigate existing violations of reliability criteria- not in cases where reliability criteria are already satisfied without the upgrade. The project sponsors had not yet answered the protests at press time. .- B.W.R.

Phantom Congestion. Citing severe underutilization of North-South transmission lines in California, Morgan Stanley has proposed that the California ISO should overcome "phantom congestion" by arbitrarily reserving grid rights for transmission users holding pre-ISO transmission service contracts at 150 percent of average grid use by such customers, and then releasing any remaining capacity that those customers hold.

Phantom congestion arises when old contracts pre-dating the ISO allow certain grid users to sit on unused grid rights until 20 minutes ahead of the hour, when others cannot make use of the released capacity, because ISO markets close a full hour ahead. .

Arizona Impasse. The Arizona Independent System Administrator (ISA), itself a stopgap agency aimed only to facilitate retail choice in Arizona until the DesertStar regional transmission organization (RTO) is certified, has defended its novel strategy of building a sunset provision (plus an added "escape clause") into agreements with its two largest members, Tucson Electric and Arizona Public Service Co. (APS), allowing them to withdraw from the ISA if, as expected, the FERC should reject certain ISA tariff rules that the two utilities want regarding line losses and unaccounted-for energy (UFE).

Meanwhile, a large group of member-owned Arizona co-ops and irrigation districts (absent Salt River) continues to oppose the process, seeing the ISA as a useless exercise if the two utilities can withdraw following an adverse FERC order, and citing the ISA agreements as likely to undermine the state's entire regime of retail choice.

As the group complains, "The agreements jeopardize open access in Arizona by enabling APS and TES ... to use the AZ ISA as cover [and then] walk away ... if the FERC does not agree to their demands. ... Transmission customers in Arizona should not be required to pay the costs to get the ISA up and running if it is going to be gutted a short time later."

But the ISA says its running costs are minimal: "It [the ISA] is a lean organization, currently comprised of only two staff members." .- B.W.R.

Electric Reliability

Western Council Merger. Several utilities from the Pacific Northwest protested the proposal to merge electricity reliability groups in the West, whereby the Western Systems Coordinating Council (WSCC) would combine with the Southwest and Western Regional Transmission Associations to form a new reliability organization, called the "Western Electricity Coordinating Council" (WECC). They described its scope and purpose as "unclear," and cited a lack of explanation on how it would affect tort exposure for participating members and affect formation of the proposed RTO West.

As Puget Sound Energy explained, the current WSCC serves simply as an information exchange (in contrast to other reliability councils) and enforces reliability standards only through its Reliability Management System, a subgroup that includes only certain WSCC members. Thus, Puget argued that the merger proposal had not fully justified "the transformation of the WSCC from