6.6. ERMUSR 01-11-2005 - Laserfiche WebLink

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Public Power Views on Federal Restructuring Policies Federal Transmission Policy Must Accommodate Regional Diversity As previously noted, the country has live up-and-running FERC jurisdictional RTOs. It does nor appear likely that RTOs ~~~ill form in the rest of the country (with the possible exception of the SPP region). Lven if it were politicall>~ possible to export nc~ current IZIO model to those regions that do nor have P."hOs now (~~~hic}1 iris not), the experience ro date of those ~~PP~~ mcmhers located in RTO regions does nor support such a Even if it were politically . course. In fact, given the considerable differences that exist in possible t0 export the the various regions of the country, it should nor be assumed that current RTO model t0 those RTOs arc tl~le only, or even the preferred, mechanism available regions that d0 not have to ensure competitive wholesale po~,~er markets. RTOs now (which it is not), the experience t0 date ~~PPA rnembcrs located ill RTO regions report substantial, Of those APPA members across-the-board problems ~,~it1i spiraling KZ'O costs, located In RTO regions does rznaccountablc governance, lack of understanding of not Support SUCK a COUI'Se. transmission customer and end-user needs and less-than- satisfactory service options. They see more and more RTC) services being provided through duestionable market mechan isms, and RTO resistance to any tluestioning of the economic theories underpinning these actions. The rcrnaining non-RTO regions are vet}~ different both from each other and from the regions ~~~hcre RTOs have already been created. Some regions have a history of using contractual an-angements and regional institutions or practices to capture mama of the benef7ts claimed for RTOs at less risk and cost, and have sho~~~n a wil-ingness to pursue alternatives to enhance transmission access and the efficiency of existing markets. Othier differences include the prevalence oljointl}' o~~'ned generation and transmission, the radial nature of transmission s}stems connecting remote generation to loads, the predominance of hydropower in the generation rnix, differences in population density, the extent to which open region-wide planning processes arc used, the existence of a frame~~~ork for enforcement of reliability standards by contract, the extent to ~,hich a standard Dorm of contracting is used for bilateral transactions, the existence of active ~n,holesale market hubs accessible to many market participants, the presence or absence of a few large dominant IOU transmission providers, existence of 6 Restructuring at the Crossroads' FERC Electric Policy Reconsidered