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FERC Docket No. EL05-121-006

FERC Docket No. EL05-121-006. PJM Interconnection, L.L.C. Paper Hearing Regarding 7 th Circuit Remand. FERC Docket No. EL05-121-006 Paper Hearing Regarding 7th Circuit Remand.

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FERC Docket No. EL05-121-006

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  1. FERC DocketNo. EL05-121-006 PJM Interconnection, L.L.C. Paper Hearing Regarding 7th Circuit Remand

  2. FERC Docket No. EL05-121-006Paper Hearing Regarding7th Circuit Remand • This investigation responds to the Seventh Circuit’s remand concerning FERC’s determination of the appropriate cost allocation method to be used by PJM for new transmission facilities operating at or above 500 kV.

  3. FERC Docket No. EL05-121-006Paper Hearing Regarding7th Circuit Remand • The postage stamp costing methodology is inappropriate in that it requires western PJM ratepayers to subsidize transmission facilities benefiting eastern PJM. • PJM’s analysis reflects the inequities associated with the postage stamp cost recovery methodology.

  4. FERC Docket No. EL05-121-006Paper Hearing Regarding7th Circuit Remand • FERC’s decision to socialize these costs has no basis in cost causation. Therefore, these rates are inconsistent with the mandates of the FPA to ensure just and reasonable rates.

  5. FERC Docket No. EL05-121-006Paper Hearing Regarding7th Circuit Remand • FERC should adopt the beneficiary pays costing methodology for all facilities regardless of the kV level. • The beneficiary pays methodology should be updated periodically to take into consideration that the electric grid is not static and evolves over time.

  6. FERC Docket No. EL05-121-006Paper Hearing Regarding7th Circuit Remand • The definition of beneficiary must also include generation as well as load. • Comments are due at FERC on Friday, May 28. • Questions?

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