The Federal Energy Regulatory Commission recently accepted the majority of tariff revisions proposed by the Midcontinent Independent System Operator (MISO), the California Independent System Operator (CAISO) and ISO New England (ISO-NE) in response to FERC’s Order No. 841.
In that order, FERC adopted rules aimed at removing barriers to the participation of energy storage resources (ESRs) in wholesale power markets operated by regional transmission organizations and independent system operators.
The filings by the three grid operators responded to FERC Order No. 841. Issued in February 2018, Order No. 841 addresses the participation of electric storage resources in the organized wholesale capacity, energy and ancillary service markets to more effectively integrate ESRs, enhance competition and help ensure that those markets produce just and reasonable rates.
MISO, CAISO and ISO-NE submitted their compliance filings at FERC on Dec. 3, 2018.
Details on grid operator filings
ISO-NE’s compliance filing was comprised of three distinct sets of rules that, taken together, demonstrate its compliance with Order No. 841, it told FERC (Docket Nos. ER19-470-000, ER19-470-001, ER19-470-002).
The compliance filing referenced existing, long-standing tariff provisions which remain unchanged by the compliance filing. The filing also referenced the large number of market rule revisions to accommodate ESR market participation that ISO-NE and NEPOOL jointly filed pursuant to Federal Power Act section 205 on October 10, 2018, and the Commission accepted on February 25, 2019. ISO-NE’s December 2018 compliance filing also included limited additional tariff revisions needed for full compliance with Order No. 841.
For its part, CAISO asserted that it had already implemented the vast majority of the mandates in Order No. 841. Because of this, CAISO explained that its compliance filing describes how its existing tariff complies with Order No. 841 and, where it does not already comply, describes how it proposes in the compliance filing to revise its tariff to comply (Docket Nos. ER19-468-000 ER19-468-001).
In its compliance filing, MISO noted that it had revised Module A of its tariff to include the required definition of ESRs. MISO said the proposed ESR definition “contains all required elements specified in Order No. 841, and is supplemented by key features of MISO’s proposed implementation of ESR market participation model” (Docket Nos. ER19-465-000 ER19-465-001).
MISO also proposed the term “Electric Storage Resource Transaction.” The grid operator defined this term as market activities associated with an ESR’s charging and discharging process, consisting of the withdrawal of energy, including any associated energy purchases, from the transmission system, and the future injection of energy, including any associated energy sales, to the transmission system under MISO’s tariff.
MISO also made additional proposals in its compliance filing.
FERC directs further compliance filings
At its Nov. 21 open meeting, FERC directed further compliance filings on a few of the tariff provisions submitted by the three grid operators, including those subjecting storage to transmission charges, allowing storage participation in both retail and wholesale markets and avoiding duplicative retail and wholesale billing.
FERC also granted MISO’s request to defer the effective date of its compliance filing to June 6, 2022.
FERC OKs SPP, PJM compliance filings for Order No. 841
FERC on Oct. 17 accepted compliance filings submitted by PJM Interconnection and Southwest Power Pool in response to Order No. 841, marking the first two orders implementing Order No. 841.
FERC found that the two grid operators generally complied with the rule and therefore largely accepted their filings but provided additional directives for further action.
The Commission also initiated proceedings under section 206 of the Federal Power Act to address the specific issue of minimum run-time requirements for ESRs.
FERC Commissioner Bernard McNamee issued concurrences for both orders.
The Commissioner expressed his continuing concern that the Commission exceeded its statutory authority under the Federal Power Act by asserting jurisdiction over electric storage resources interconnecting either to a distribution system or behind-the-meter “and should have, at the very least, provided states the opportunity to opt-out of the participation model” created by Order Nos. 841 and 841-A.
As with the PJM and SPP Order No. 841 compliance filing orders, McNamee filed concurrences in the MISO, CAISO and ISO-NE proceedings reiterating his concern with the Commission’s assertion of jurisdiction over storage resources interconnecting to a distribution system or behind-the-meter and stating his belief that the Commission should have included an opt-out provision for the states.
FERC largely upheld storage order earlier this year
FERC on May 16 issued an order in which it largely upheld determinations it made in Order No. 841.
At that time, McNamee raised jurisdictional concerns over FERC’s action, saying he was troubled that Order 841 and the order on rehearing (Order 841-A) “do not fully respect or consider the impact they may have on local distribution systems, the states that regulate those local distributions systems, and local retail customers,” concerns that were previously raised by the American Public Power Association, American Municipal Power and the National Rural Electric Cooperative Association.
Groups say storage orders ignore federal/state jurisdiction bright line
FERC’s orders that established rules for the participation of ESRs in the capacity, energy, and ancillary service markets operated by RTOs and ISOs disregard the bright line between federal and state jurisdiction, the American Public Power Association, the Edison Electric Institute, the National Rural Electric Cooperative Association and American Municipal Power recently argued.
In a recent court filing, the groups said that FERC Order Nos. 841 and 841-A ignore the bright line by limiting states to imposing conditions on individual interconnections needed by distribution-level storage to participate in wholesale markets but forbidding states from broadly prohibiting such participation.
The groups on Oct. 30 filed their joint opening brief at the U.S. Court of Appeals for the District of Columbia Circuit in their appeal of FERC Order Nos. 841 and 841-A.