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Perspective

Wisconsinites don't fear 'Day 2.' But let's get the grid rights right.
Fortnightly Magazine - March 2004
  1. Service Commission of Wisconsin, FERC , filed Aug. 27, 2003.
  2. Mr. Miller's lack of stated appreciation for MISO's lack of market-readiness before Aug. 14, 2003 runs even deeper. His analysis ignores the lingering "Day 1" problems that MISO faced last October. Many of these issues were rolled into MISO's new Reliability Charter, which MISO claims is largely responsible for the roughly $40 million cost of market delay.
  3. In fact, FERC is investigating the degree of transmission congestion on the Delmarva Peninsula and the associated LMP implications. FERC .
  4. See U.S. Department of Energy, National Transmission Grid Study: Issue Papers, May 2002.
  5. FERC, White Paper on Wholesale Power Markets Platform, available at http://www.ferc.gov/industries/electric./indus-act/smd/white_paper.pdf
  6. See white paper, Appendix A, pp. 7-8. Also, in its white paper FERC stated that in its final SMD rule, FTRs "would be allocated according to existing contracts and existing service arrangements in order to hold customers harmless." See p. 10.
  7. FERC .
  8. See Order on Petition for Declaratory Order, FERC , issued Feb. 24, 2003. In its order to MISO, with respect to MISO's initial FTR allocation, FERC places a higher priority on holding "existing transmission customers whole with respect to congestion-related charges under MISO Day-2 operation to the extent possible given the objective of simultaneous feasibility" than on MISO's other objectives for its FTR allocation.
  9. ATC was created under state law to address our state's historic underinvestment in transmission. ATC plans to construct almost $3 billion in new transmission projects in Wisconsin over the next decade.
  10. Wisconsin PSC .
  11. The PSCW recently authorized the construction of approximately 2,500 MW of coal-fired baseload and natural gas-fired intermediate generation facilities at existing plant locations near load. PSCW .
  12. MISO's "Market Subcommittee Energy Markets Tariff Issues Update" to the MISO Advisory Committee, Jan. 14, 2004.
  13. The identified "gaps" include market mitigation measures; initial FTR allocation and nomination methodology; system support resources agreement and compensation; marginal losses crediting mechanism; and creditworthiness provisions.
  14. At the Jan. 14, 2004, MISO Advisory Committee meeting, stakeholders reported that they will not work on control area consolidation issues until after they resolve issues related to roles and responsibilities. The Aug. 14, 2003, blackout has amplified concerns in Wisconsin and elsewhere in the MAPP region over the feasibility of centralized control of the entire MISO footprint. Some MAPP members and other Wisconsin utilities are concerned that MISO's central control does not properly recognize the differences in the multiple control areas in its footprint. To the best of my knowledge, other RTOs that operate with single control areas did not face such challenges during market implementation.
  15. This leads to another question that Mr. Miller did not address when expressing his concern for MISO's tariff withdrawal: Would MISO's grid monitoring tools have been sufficiently developed and tested in time for a March 2004 LMP-based market start-up? Even Mr. Miller concedes that for LMP-based markets to enhance reliability, the price must reflect "the actual physical state of the grid." He describes that condition as the "kicker." An LMP-based market start-up only weeks after the necessary grid monitoring tools are operationally proficient