MISO and PJM agree in principal to form one large RTO

Midwest Independent Transmission System Operator Inc. and PJM Interconnection agreed in principal to form a single market for electricity that will encompass 27 Midwest and Mid-Atlantic states, the District of Columbia, and the Canadian province of Manitoba

Jan. 22, 2002

2 min read

By the OGJ Online Staff

HOUSTON, Jan. 21 -- Midwest Independent Transmission System Operator Inc. and PJM Interconnection LLC agreed in principal to form a single market for electricity that will encompass 27 Midwest and mid-Atlantic states, the District of Columbia, and the Canadian province of Manitoba.

The single energy market will be administered by two separate organizations. Some functions will be done jointly and others individually. The two grid operators will establish a joint stakeholder market committee to develop the new market design.

Southwest Power Pool also will be included. The new market organization must be approved by the Federal Regulatory Energy Commission. A name for the new organization wasn't mentioned in the statement nor the costs involved in the combination. PJM did not return phone calls.

When SPP becomes part of a FERC-approved regional transmission organization, then areas of Northeast Texas might soon be approved by Texas regulators to participate in the competitive retail market. Texas deregulated the retail market on Jan. 1, excluding parts of Northeast Texas that are part of SPP.

State regulators were concerned that wholesale operations of SPP might not be competitive enough to support retail deregulation at this time. Regulators said if SPP were part of a larger FERC-approved regional transmission organization, they would review the readiness of that region for full competition.

The proposed regional energy market means both regions will realize the benefits of a "seamless power market," said James P. Torgerson, CEO of MISO.

MISO serves 17.5 million customers with 114,000 Mw of peak load and 125,000 Mw of generating capacity. PJM serves 25.1 million people with 66,072 Mw of generation capacity and 62,445 Mw of peak load.