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Wyden threatens legislative action if FERC does not rework order on regional cost allocation in the Pacific Northwest


From the June 21, 2013 issue of Public Power Daily

Originally published June 21, 2013

By Robert Varela
Editorial Director
Senate Energy and Natural Resources Committee Chairman Ron Wyden, D-Ore., said he "will have little choice but to consider" possible legislative action if the Federal Energy Regulatory Commission does not promptly reverse a June 20 order on transmission cost allocation in the Pacific Northwest. In response to a ColumbiaGrid filing on compliance with FERC’s Order No. 1000, the commission ruled that regional cost allocation determinations for new transmission must be binding on identified beneficiaries. The June 20 order "is a major step backward," Wyden said.

"The Northwest transmission system is dominated by public entities such as [the Bonneville Power Administration] that generally are not subject to FERC jurisdiction," Wyden said. "Instead of responding to this fact by issuing a ColumbiaGrid order that takes into account regional differences, FERC has done the opposite."

FERC’s decision means that, to participate in the ColumbiaGrid transmission planning process, non-jurisdictional utilities like BPA "must sign a blank check to pay for the costs of transmission that they have not contracted for and may not use," Wyden added. "This is directly counter to the interests of Northwest ratepayers and may lead to an exodus from ColumbiaGrid."

Commissioner Tony Clark drew praise from Wyden for dissenting from the ColumbiaGrid order. Clark said the order "runs afoul" of the commission’s assertions "that flexibility and respect for regional differences would be a hallmark of this undertaking." The region is unique, with BPA providing 75 percent of the transmission service, he noted.

Jurisdictional and non-jurisdictional utilities in this region have been planning together through ColumbiaGrid since 2006 and propose to continue this planning process while incorporating key elements of Order No. 1000, Clark said. "While Bonneville is either unable or unwilling to commit to the sort of binding cost allocation envisioned by Order No. 1000, I view these filings as a best effort to comply with the spirit of Order No. 1000, while acknowledging the reality of the transmission grid in the Pacific Northwest."

Substantially accepting the ColumbiaGrid filing would allow utilities in the region to effectively participate in an "Order No. 1000-like" process, Clark said. "By rejecting key elements of this filing, I am concerned that we may do more harm than good in this region. ... it is hard to contemplate an effective regional planning effort that ignores the reality of a region dominated by one non-jurisdictional transmission provider."
“While FERC continues to talk about regional deference, this order runs counter to that principle, and counter to the interests of ratepayers in the Northwest,” said Public Power Council Executive Director Scott Corwin. “We have a strong concern that FERC is trying to force non-jurisdictional utilities into its preferred approach to planning and allocation of the costs of transmission, and away from a construct that has worked very well in the Northwest.” He praised the dissent by Clark and said the PPC appreciates the statement released by Wyden.

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Senior Vice President, Publishing 
Jeanne Wickline LaBella
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Editorial Director
Robert Varela
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Editor, Public Power Daily
Jeannine Anderson
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