It would join an RTO but dictate the terms-a dangerous game that has the industry talking.
When I talked a few months ago with AEP President and CEO Linn Draper Jr., he discussed how his company would have joined the PJM RTO in March were it not for the backlash he was getting from certain state regulators.
Today, nothing has really changed. The company promises to participate fully in an RTO by July of next year-but again only if state PUCs raise no objections (hardly likely, since several state commissions have indicated recently that they will oppose PJM membership for AEP in 2004, out of concerns over reliability and market power.)
But do the states protest too much? Should FERC step in, push aside the PUCs and bring AEP to heel? At least one rival company thinks so. Just listen to Exelon Vice President Elizabeth Moler.
"State regulatory proceedings that purport to prohibit AEP from joining PJM are directly and deliberately impeding federal policy over interstate transmission," said Moler, testifying before FERC in early September.
"The actions by the states amount to unconstitutional efforts to burden interstate commerce in favor of the citizens of their own states. … Those state actions … impede reliable interstate transmission service … throughout the PJM-MISO footprint," she added.
Moler, herself a former commissioner and chairman at the Federal Energy Regulatory Commission (FERC), believes the feds have the power to exempt AEP from state compliance with that state action under PURPA. Such power would not threaten Exelon, of course, since its Chicago-area subsidiary, Commonwealth Edison, appears truly committed to RTO membership.