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PJM Addresses Local Supply Issues

Electric shortages and the generation overbuild continue to co-exist.

Fortnightly Magazine - April 2007

as a “critical congestion area.” 6 Critical congestion areas represent candidates for designation as NIETCs, which would be eligible for federal backstop siting authority when states fail to act on transmission-expansion applications. AEP, Allegheny, and PHI view that NIETC designation as a probable requirement for their projects to be approved, given the top two obstacles to their transmission proposals—individual landowners and conflicts involving federal agencies. On Oct. 11, 2006, PJM told the DOE that it had asked FERC to designate three areas within PJM as NIETCs. These areas include the Allegheny Mountain, the Delaware River, and the Mid-Atlantic corridors.

 

Endnotes:

1. Settlement Agreement and Explanatory Statement of the Settling Parties Resolving All Issues in PJM Interconnection LLC, Docket No’s ER05-1410-000 and -001, and EL05-148-000 and -001.

2. The August 2005 filing originally had proposed a four-year planning horizon, which later was amended in the September 2006 settlement agreement to a three-year planning period.

3. The delivery year begins on June 1 through May 31 of the following calendar year.

4. FERC Docket No. AD05-3-000.

5. Total congestion costs in PJM in 2005 reached $2.09 billion, representing a 179 percent increase from the 2004 costs of $750 million. This huge increase is partially driven by the expanded PJM footprint in 2005.

6. “National Electric Transmission Congestion Study,” August 2006, U.S. Department of Energy.

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