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RTWG Tariff Update: Implementation of RSC Plan Changes

Review of RSC's Participant Funding plan and major tariff modifications for transmission cost allocation. Learn about the expected timeline and steps in the process.

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RTWG Tariff Update: Implementation of RSC Plan Changes

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  1. RTWG Tariff update to the BOD, MOPC, SPC, and RSC January 4, 2005

  2. RTWG Tariff Update • Where are we in the process • What is the expected timeline for completion • Review of the proposed tariff changes

  3. Overview • RTWG is making changes to the tariff to implement the RSC approved Participant Funding plan • Clarifications or fundamental questions regarding the plan are referred back to the RSC/CAWG • RTWG is NOT discussing the merits of the plan

  4. A Review of the RSC Plan • 100% of the costs of approved Base Plan upgrades are recovered through the tariff • The Plan defines the rules for how an upgrade is included in the Base Plan • RTO approved reliability upgrade • Upgrades required by a Network Customers to receive power from a new DNR if upgrades meet certain criteria

  5. RSC Plan (cont) • Conditions for Base Plan Treatment of upgrades for new DNRs • Minimal cost (<$100,000) • DNR must be a 5yr or longer firm entitlement • Customer can not exceed a 125% reserve margin • Upgrade costs capped at $180,000/MW • The Plan does allow for SPP to waive some or all of the above conditions

  6. RSC Plan (cont) • Waiver requirements • Customer must request the waiver and give supporting documentation • SPP staff will review the waiver request • SPP staff will then present the waiver request and its recommendation to the MOPC • MOPC will pass the waiver, the SPP staff recommendation and its recommendation to the BOD • SPP BOD will decide on the waiver request • The customer has the right to present their position at all levels

  7. Required Tariff Changes • The RSC Plan calls for major changes in rate design • Will have a two tiered rate: • Current Zonal Charge – For customers that take service under the tariff • Base Plan Charge –applied to all load in SPP for recovery of Base Plan upgrade costs with regional and zonal components • Facilities not eligible for Base Plan treatment directly assigned with revenue credits • A new schedule is required to implement the plan • The remaining changes are primarily in rewriting Attachments H, J, L & S

  8. Issues Still Before the RTWG • Outstanding questions posed to the RSC/CAWG • Can a customer recover any directly assigned costs as a credit pursuant to Attachment Z? • How should the Credits for delayed or deferred Base Plan Projects be calculated? (RR or Cost) • Should project costs of < $100,000 be directly assigned to the host zone or split between the Regional and zonal rates? • Finalize remaining tariff language

  9. Possible Reasons forDelaying a Filing • Delayed response from RSC/CAWG to outstanding questions • Responses from RSC/CAWG require major changes to proposed language • A problem in the proposed tariff language is discovered at the last minute • RSC/CAWG request changes to the proposed tariff language • Proposed Language is not approved by the MOPC and/or the BOD

  10. Time Table • RTWG meets this week to try and finalize the tariff language • Targeted to get language to MOPC and BOD for their review and approval at their respective January meetings • December FERC filing provides for January policy review and February implementation of any directives • SPP committed to file by March 1

  11. Questions???

  12. Transmission Cost Allocation Proposal – SPP Tariff Modifications January 4, 2005

  13. Implementation of Proposal • Need to modify the Tariff to: • Allocate costs for new transmission upgrades • Establish rates for collecting the costs • Recover and distribute the TOs revenue requirement • Document new defined terms

  14. Major Tariff Changes for Implementation of Cost Allocation Proposal • Modify Attachment J – Recovery of Costs Associated with New Facilities • Presently includes sunset provision for roll-in • Allocates costs for new upgrades • Add Part V & Schedule 11 – Base Plan Charge • Establishes rates and applicability of the rates to recover TOs revenue requirement for new upgrades • Modify Attachment L – Treatment of Revenues • Distributes revenues collected under Schedule 11 to the TOs

  15. Attachment JCost Allocation Provisions • Base Plan Upgrades • Economic Upgrades • Requested Upgrades • Provides a link to existing Attachment Z, Aggregate Transmission Service Study Procedures • Generation interconnection related Network Upgrades • Provides a link to existing Attachment V, Large Generator Interconnection Procedures

  16. Attachment JOther Provisions • Review of the regional allocation factor & zonal allocation methodology at least once every 5 years • Conditions for including future DNRs as Base Plan Upgrades (Safe Harbor) • Waiver process for DNRs that do not meet the Safe Harbor conditions • Intra-zonal allocation review process • Cost allocation provision for Network Upgrades that defer or displace the need for a Base Plan Upgrades

  17. New Part V – Recovery of Costs for Base Plan Upgrades • Establishes a “new” charge (Base Plan Charge) to collect the revenue requirement for Base Plan Upgrades & any portion of other Network Upgrades that are eligible for Base Plan Upgrade treatment • Sets out applicability of the charge • Provides a link to new Schedule 11 that sets out the rate/charge

  18. Applicability of Base Plan Charge • The intent is to apply this charge to ALL load within the SPP footprint: • Load currently taking network service under the SPP Tariff; and • To all other load that is not currently taking service under the SPP Tariff • Bundled retail load for which Transmission Owners have not requested service under the SPP Tariff • All load being served under Grandfathered Agreements • To Transmission Customers taking P-to-P under the SPP Tariff

  19. New Schedule 11 – Base Plan Charge • Charge to Network Customers & TOs for load is assessed on a load ratio share basis • Charge to Transmission Customers taking P-to-P under the SPP Tariff is based on Reserved Capacity • Zonal component & regional component assessed for load & for P-to-P

  20. Attachment L – Treatment of Revenues • Currently establishes distribution of revenues to TOs collected by SPP for transmission service and other services • Adds new provision for distribution of revenues to TOs collected by SPP under new Schedule 11 • In proportion to their respective ATRRs for new transmission upgrades

  21. Other Tariff Changes • Section 1 – Definitions • Attachment H – Annual Transmission Revenue Requirement • Attachment S – Procedure for Calculation of MW-Mile Impacts • Provisions governing revenue distribution in the event of customer non-payment

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