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Office of Indian Energy Policy and Programs Office of Indian Energy Policy and Programs

Office of Indian Energy Policy and Programs - PowerPoint Presentation

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Office of Indian Energy Policy and Programs - PPT Presentation

2012 Tribal Webinar Series Unwinding Transmission Policies February 29 2012 1100 am 1230 PM Unwinding Transmission Policies DOE Tribal Webinar Series February 29 2012 Mike McElhany ID: 700511

energy transmission regional cost transmission energy cost regional policy order western ferc 1000 power planning allocation 2012 electric tribal

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Slide1

Office of Indian Energy Policy and Programs

2012 Tribal Webinar Series

Unwinding Transmission Policies

February 29, 2012 11:00 am – 12:30 PM

Slide2

Unwinding Transmission PoliciesDOE Tribal Webinar Series

February 29, 2012

Mike McElhany

Transmission Business Unit

Western Area Power AdministrationSlide3

Unwinding Transmission PoliciesOverview of WesternThe Players - Alphabet Soup

Policy SourcesFocus on FERCFERC AuthoritiesEPAct05

FERC Policy FormulationFERC FAQ

Order 1000 – O1kQuestionsSlide4

Overview of WesternSlide5

Markets 10,479 MW from 57 Federal Hydropower Projects owned by BOR , Corps, and IB&WC to preference power entities17,100 miles of high-voltage transmission line across 15-statesAbout 100 tribal customers who receive around 1.2 million megawatt hours per year

Tribes make up 10% of Western’s core power customersOverview of WesternSlide6

Overview of WesternSlide7

Transmission Business Unit-TBUTransmission FootprintRocky Mountain Region – WACM BA

Colorado River Storage ProjectLoveland Area ProjectsDesert Southwest Region – WALC BACentral Arizona ProjectColorado River Storage ProjectPacific Northwest-Pacific Southwest Intertie Project

Parker Davis Project

Boulder Canyon Project (Non-transmission)Slide8

Alphabet Soup – FederalFERC – Federal Energy Regulatory CommissionNAESB – North American Energy Standards BoardNERC – North American Electric Reliability Corporation

DOE – Department of EnergyDOI – Department of InteriorBLM – Bureau of Land ManagementEPA – Environmental Protection AgencyCongressional/Legislative Slide9

Alphabet Soup – State/RegionalPUC – Public Utility CommissionsWGA - Western Governors AssociationWIEB – Western Interstate Energy Board

WECC – Western Electricity Coordinating CouncilTEPPC – Transmission Expansion Planning Policy CommitteeRPS – Renewable Portfolio StandardsNARUC – National Association of Regulatory Utility CommissionersSlide10

Alphabet Soup – Trade AssociationsAPPA – American Public Power AssociationEEI – Edison Electric InstituteELCON – Electricity Consumers Research Council

EPSA – Electric Power Supply AssociationLPPC – Large Public Power CouncilNRECA – National Rural Electric Cooperative AssociationTAPS – Transmission Access Policy Study GroupSlide11

Policy SourcesLegislative actions – EPAct05NERC Reliability Standards Market DrivenMarket Power Driven

Power System DisturbancesIndirect sources (BLM, EPA, etc)State/Regional sourcesLocal/Consumer sourcesTrade AssociationsSlide12

Focus on FERCFERC’s Mission: Reliable, efficient and sustainable energy for consumersAssist consumers in obtaining reliable, efficient cost through appropriate regulator and market means.

Fulfilling this mission involves 2 primary goalsEnsure that rates, terms and conditions are just, reasonable and not unduly discriminatory or preferential.Promote the development of safe, reliable and efficient energy infrastructure that serves the public interest.Slide13

FERC AuthoritiesDepartment of Energy Organization ActElectric Consumers Protection ActEnergy Independence and Security Act (2007)Energy Policy Act of 2005 (EPAct05)Energy Policy Act of 1992

Federal Power ActPublic Utility Holding Company Act of 1935Public Utility Regulatory Policies Act of 1978Slide14

EPAct05 required FERC to:issue a final rule implementing the new reliability provisions (NERC)issue a report to Congress on Transmission System Monitoring (SmartGrid

)exercise its authority under the FPA in a manner that facilitates planning and expansion of transmission facilities (O1k)establish rules for incentive-based rate treatments for interstate transmissionIssue rules for applications for national transmission corridor permits Slide15

EPAct05 allowed FERC to:require comparable open access to be provided by non-regulated transmission utilities issue rules to increase transparency in electric and gas marketsprescribe such rules as it determines necessary and appropriate, to prevent manipulation of electric and gas markets.Slide16

FERC Policy FormulationFERCPetition for RulemakingNotice of Proposed Rulemaking

Notice of Final RulemakingRehearing of RulemakingDeclaratory OrdersNERCReliability Standards and Enforcement ActivitiesNAESB

Standards which lead to a seamless marketplaceSlide17
Slide18
Slide19
Slide20

FERC FAQWho has ultimate authority over FERC?FERC answers to the U.S. Congress.Commissioners and senior staff are routinely called to testify before various committees.FERC’s decisions can be appealed before the federal courts.

Does FERC have jurisdiction over Western?Western has filed a “Safe Harbor” OATTWestern must be compliant with NERC Reliability Standards, FERC enforcement of violations has not been tested yet. Slide21

Order 1000 – O1k - TimelineOrder 888 in 1996: Requires open access to transmission facilities to address undue discrimination to bring more efficient, lower cost power to the Nation’s electricity consumers

Order 890 in 2007: Requires Coordinated, open and transparent regional transmission planning processes to address undue discriminationSlide22

Order 1000 – O1k - TimelineOrder 1000 in 2011Requires transmission planning at the regional level to consider and evaluate possible transmission alternatives and produce a regional transmission plan

Requires the cost of transmission solutions chosen to meet regional transmission needs to be allocated fairly to beneficiariesSlide23

Order 1000 – RequirementsPlanning RequirementsCost Allocation Requirements

Nonincumbent Developer RequirementsComplianceSlide24

Order 1000 – PlanningPublic utility transmission providers are required to participate in a regional transmission planning process that satisfies Order 890 principles and produces a regional transmission planLocal and regional transmission planning processes must consider transmission needs driven by public policy

Look for more efficient and cost-effective solutionsSlide25

Order 1000 – Cost AllocationRegional transmission planning processes must have a regional cost allocation method for a new transmission facility selected in the regional plan for purpose of cost allocationNeighboring transmission planning regions must have a common interregional cost allocation method for a new interregional transmission facility that the regions select

Participant-funding of new transmission facilities is permitted, but is now allowed as the regional or interregional cost allocation methodSlide26

Order 1000 – Cost AllocationCosts allocated “roughly commensurate” with estimated benefitsThose who benefit pay, those who don’t benefit don’t pay

Benefit-to cost thresholds must not exclude projects with significant net benefitsNo allocation of cost outside a region unless other region agreesCost Allocation methods and identification of beneficiaries must be transparentDifferent allocation methods could apply to different types of transmission facilitiesSlide27

Order 1000 – Nonincumbent Developers

Rule promotes competition in regional transmission planning processes to support efficient and cost effective transmission developmentRule requires the development of a not unduly discriminatory regional process for transmission project submission, evaluation, and selectionSlide28

Order 1000 – ComplianceEach transmission provider is required to make a compliance filing within twelve months of the effective date of the Final Rule (October 2011 - October 2012)

The compliance filing for interregional transmission coordination and interregional cost allocation must be file within eighteen months of the effective date (October 2011 - April 2013)Slide29

Order 1000 – ActivitiesWestern is participating in the formation of an O1k compliant planning regionPlanning Regions in the Western Interconnect

WestConnect – (Western is participating)ColumbiaGrid – (Bonneville Power Administration)NTTG – Northern Tier Transmission GroupCAISO – California ISOSlide30

Mike McElhany TBU Manager

mcelhany@wapa.govLinks:www.ferc.govwww.nerc.com

www.wapa.govSlide31

Office of Indian Energy Policy and Programs

Upcoming Webinars

March 28, 2012 at 11:00 am MST: Understanding the Transmission Queue Process

May 30, 2012 at 11:00 am MST: Today’s Energy Supply – Yesterday’s Grid

July 25, 2012 – Grid Reliability – Impacts to Tribal Renewable Projects

September 26, 2012 - DOE Office of Indian Energy’s START Program Status Updates Slide32

Office of Indian Energy Policy and Programs

Tracy LeBeau

Office of Indian Energy Policy and Programs 

Tracey.Lebeau@Hq.Doe.Gov

Lizana Pierce Tribal Energy Program lizana.pierce@go.doe.gov

Steve Tromly

WAPA Tribal Program Manager

tromly@wapa.gov

Randy Manion

WAPA Renewable Program Manager

manion@wapa.gov