FERC last week directed its senior staff to hold informal discussions with the Florida Public Service Commission (PSC) in response to the PSC’s concerns about the development of GridFlorida, a regional transmission organization (RTO). The PSC concerns focus on state and federal jurisdictional boundaries and responsibilities and the recovery of start-up costs for the RTO.

The Commission’s action last week stems from a late March order determining that GridFlorida meets the minimum RTO characteristics and functions described by FERC in Order 2000. At the same time, FERC provisionally granted RTO status to GridFlorida. In the wake of the Commission’s March order, requests for rehearing were made by several parties, including the PSC. FERC’s Order 2000, issued in December 1999, spelled out the Commission’s expectation that transmission owners will join RTOs on a voluntary basis.

In an order issued last Thursday, FERC denied a request for rehearing by the PSC that it hold a formal technical conference to develop a formal memorandum of understanding between the two regulatory bodies. The PSC proposed that such a conference examine the roles of FERC and the state commission in overseeing GridFlorida. While rejecting the technical conference idea, FERC said that it would direct the Commission’s senior staff to hold the informal discussions with the PSC and to work collaboratively with the PSC to address its concerns.

“What we’re finding more and more — and certainly having previously been a state commissioner and state chairman of a commission I can tell you — [is] that the retail regulators are concerned about how we move through this RTO process,” FERC Chairman Curt Hebert said following the Commission’s bi-weekly meeting last Wednesday. “And, understanding that, I think it should be our commitment — the commitment of FERC — to reach out to RTOs that are trying to develop and try to help them move through that process as quickly as possible.”

“Part of the expedience has everything to do with confidence in the system and us going down and answering questions certainly does that,” Hebert said.

FPL recently said that it may have to re-evaluate its GridFlorida plans in the wake of recent concerns expressed by PSC staff related to the company’s participation in the RTO (see NGI, May 7).

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