Southwest Power Pool to address FERC RTO concerns

By the OGJ Online Staff

HOUSTON, Mar. 29�Officials of the Southwest Power Pool will go back to the drawing board now that the Federal Energy Regulatory Commission has rejected the organization's plan to form a regional transmission organization, a spokeswoman said Thursday.

The agency also rejected Entergy Inc.'s plan to participate as a for-profit transmission company in the nonprofit SPP regional transmission organization (RTO). FERC gave SPP and Entergy until May 25 to respond to commission concerns about how the two will mesh operations.

Separately, FERC provisionally granted GridFlorida LLC regional transmission operator status subjection to various compliance filings.

Earlier this month, John Marschewki, president of the Southwest Power Pool Inc. (SSP), said in Houston the organization expected FERC to approve its second bid to become a regional transmission operator.

"We would have preferred a consent order," said the SPP's Stacey Duckett. But the board is now reviewing the order to decide how to respond, she said. FERC asked SPP to explain in detail how the RTO will accommodate new members and a larger region.

Based in Little Rock, Ark., SPP has provided regional security coordination and regional transmission administration for its 50-member organization on a voluntary basis in Oklahoma, Kansas, Arkansas, and parts of nearby states.

FERC has raised scope and configuration issues in the past, Duckett said, and SPP believed these were addressed with the inclusion of Entergy in the RTO. SPP also has had discussions with other companies about joining. Duckett said SPP should be able to show it has attempted to add members by the FERC deadline, but given the time constraints will have difficulty signing new recruits between now and May 25.

In its order, the agency also said SPP member companies should make filings with the commission transferring operations control of their transmission assets to the SPP rather than waiting until after FERC approves the RTO.

Asset transfer was an issue in SPP's initial May 2000 filing which was rejected by FERC. SPP refiled in October 2000 after responding to FERC concerns about the need to expand and change the composition of the board, in addition to broadening it geographic reach.

In provisionally approving GridFlorida, made up of Florida Power & Light Co., Florida Power Corp., and Tampa Electric Co., FERC directed the organization to file a status report on scope and configuration and on interregional coordination by May 14. The agency also directed the transmission operator to make various tariff filings.

Under Order 2000, adopted in December 1999, FERC encouraged voluntary formation of regional transmission organizations. The federal oversight agency said larger regional organizations were needed to eliminate rate "pancaking"�the practice of billing a supplier of power several times as it passes through various control areas and to end discriminatory practices that limited independent generators and others access to transmission capacity.

Under a FERC deadline, RTOs must begin operating by Dec. 15.