By Clara Summers, Campaign Manager
Consumers for a Better Grid (a project of CUB)
It’s been a busy summer advocating for electric customers at PJM, a power grid operator that controls the flow of electricity over big transmission lines that stretch across northern Illinois and all or parts of a dozen other states. CUB started the Consumers for a Better Grid project because decisions by PJM–the nation’s largest grid operator–affect how clean, reliable and affordable power is for ComEd customers.
So here’s a breakdown of some major developments concerning PJM this summer–the good, the bad, and the ugly.
The good: The Federal Energy Regulatory Commission (FERC) recently came out with a new regulation, Order 1920, for how to plan transmission. (If you need an overview of what transmission is, check out our previous blog). The rule is timely and necessary, since building transmission haphazardly is more expensive and less beneficial, and transmission lines are critical to move cheap renewable energy to where it is consumed. Recently, the Illinois Commerce Commission weighed in on Order 1920, adopting a resolution that called it “a historic order that addresses the need for long term transmission planning.”
The FERC rule does a couple of things:
It requires that transmission operators, like PJM, take into account a number of key factors when planning for the future. These factors include state laws, utility integrated resource plans, where we expect power generation to retire, where we expect power generation to connect to the grid, and trends in fuel costs.
One of the big questions and frequent fights is: Who pays for transmission? As consumer advocates, this is something we really care about! Fortunately, FERC’s Order doesn’t change anything fundamental about how payment, or “cost allocation,” gets assigned. If you benefit from the transmission, you will contribute to the bill. If you don’t benefit, you won’t pay. FERC included a list of benefits to consider when assigning payment, which are all related to reliability and reducing costs.
The bad: If implemented properly, the FERC rule could be a big step forward. But unfortunately, PJM would rather stay in place. They have gone back to FERC requesting a rehearing, or basically, a do-over of some of their decisions. (If the FERC rule is a homework assignment, PJM is going back to the teacher to ask if they can change the assignment. We hope the “teacher”–FERC–just tells them to do the homework.) One of the changes PJM is asking for is the requirement to consider state policy in planning. PJM would rather close its eyes to strong energy laws–like Illinois’ Climate and Equitable Jobs Act– that have been passed by state legislatures across the region and assume that they don’t exist. That would mean building a transmission system that can’t meet our future needs.
The ugly: As if that weren’t enough, PJM is also trying to get approval from FERC for a deal it secretly negotiated with transmission owners, called the Consolidated Transmission Owners Agreement, or CTOA. Transmission owners are the wealthy and powerful energy companies–like Exelon, the parent of utility ComEd–that own the big, high voltage lines that crisscross the nation. If FERC approves the CTOA, transmission owners will get to override more efficient regional projects, and instead build many smaller “supplemental” projects that are more lucrative for transmission companies and expensive to consumers. The deal also includes extra giveaways to the transmission owners to shield them and PJM from scrutiny and make it extra hard to challenge them.
The CTOA changes would be bad news even without Order 1920, but if they get approved, they will undermine all the progress that Order 1920 could otherwise make. It’s a bad deal for consumers, and it’s supremely disappointing that PJM decided to move forward with the deal, despite overwhelming opposition from everyone (well, except for the transmission owners, who will make lots of money).
The solution: We won’t take this lying down! On July 22, CUB filed a protest at FERC against the CTOA. We received legal representation from Earthjustice, and were joined by the Delaware Division of the Public Advocate, Office of the People’s Counsel for the District of Columbia, Natural Resources Defense Council, Sierra Club, and the Sustainable FERC Project. Whether it’s keeping tabs on how PJM implements Order 1920, or fighting giveaways to transmission owners, CUB will continue to be your grid operator watchdog.
About the Author:
Clara Summers joined CUB in 2023. She heads the Consumers for a Better Grid (formerly CLEAR RTO) campaign, which advocates for a cleaner, more affordable power grid for the 65 million people served by PJM, the nation’s largest grid manager. Clara is based in the greater DC area. When not deep in the weeds of energy policy, she enjoys Irish dance, hammered dulcimer, and anything to do with koalas.
