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Don't Rush the Seamstress: Second Thoughts on the Marriage of the Northeast Grids

Why a standard design in each ISO is no guarantee of regional coordination.
Fortnightly Magazine - September 1 2001

to set up an IRTO, at least until North America manages to put together a continental grid.

Isn't the IRTO just one more idea that we don't need?

It's no more untried than anything else on the table, and we think that setting up the IRTO would be a more manageable task, computationally, than the MOU/SMD proposal. 11

To be fair about it, the FERC may have gotten one thing right-that a lot of small, uncoordinated ISOs will not succeed in forming viable competitive markets. The question on the table, however, is this: Will a hastily arranged marriage encouraged by FERC, with FERC prescribing the details of the market, produce a vigorous, efficient market, either?

That sounds like the opening of one of those old radio soap operas doesn't it? Unfortunately, it is not.

  1. Regional Trans. Organizations, , modified on rehearing, ¶.
  2. , signed Aug. 10, 1999. See
  3. See Massey, Commissioner, concurring in, "I am also heartened that today's orders addressing the Northeast clearly set PJM as the platform upon which the Northeast RTO will be built. The PJM market design, which is based onlocational marginal pricing, has proven itself again and again."
    See also, , Order on RTO Compliance Filing [New York], ; Order Granting, In Part, and Denying, In Part, Petition for Declaratory Order [New England], .
  4. Order Initiating Mediation, Docket No. RT01-99-000, July 12, 2001, 96 FERC ¶61,065
  5. Id., mimeo at pp. 1
  6. See, e.g., Marija Ilic and Leonard Hyman, "Getting It Right the First Time: The Value of Transmission and High Technologies", Vol. 9, No. 9, Nov. 1996.
  7. Ilic, M., "A Eulogy for RTOs - Interregional is Better", , Oct. 15, 2000.
  8. Yoon, Y., Ilic, M. and Collison, K., "Efficient Implementation of Inter-regional Transactions", Proceedings of the IEEE PES Summer meeting, Vancouver, CA, July 2001.
  9. Ilic, M. and Liu, S., Hierarchical Power Systems Control: Its Value in a Changing Power Industry, Springer-Verlag London Limited Series, Advances in Industrial Control, March 1996.
  10. Intelligent Energy Systems, Inc.;,
  11. Ilic, M., and Y. Yoon. "Inter-regional Transmission Organization: Designs, Functions and Tariffs", U. S. Patent Filing (MIT case 9062), October, 14, 2000.

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