FERC Commissioner William Massey last Thursday voiced concerns that the plans of several electric utilities to join grid operators based outside of their companies’ own regions could lead to the formation of not one, but two poorly crafted regional transmission organizations (RTOs) in the United States.

During the Commission’s agenda meeting Thursday, Massey put the spotlight on the points at which the Midwest Independent Transmission System Operator (MISO) and the PJM Interconnection will abut each other. “This is the geographic area of the former Alliance companies,” the Commissioner noted. MISO and PJM are working to jointly develop a single wholesale electricity market that will stretch across dozens of states, the District of Columbia and a Canadian province.

From Massey’s perspective, this part of the country appears to continue to evolve “according to the idiosyncratic desires of the transmission owners and in a way that does not necessarily respect this Commission’s often stated concerns for appropriate RTO scope and configuration.”

He said that if those concerns are not respected, “the end result will be poorly configured, swiss cheese, marble cheese — whatever you want to call it — RTOs where members are not even contiguous with one another, and that, it seems to me, will be very strange indeed.”

He noted that Illinois Power, Commonwealth Edison and American Electric Power (AEP) recently announced plans to join PJM, while FirstEnergy, “which is to the East somewhat of AEP and Illinois Power, plans to move to the West and join the Midwest ISO.” PJM is the grid operator for the Mid-Atlantic region.

“I really wonder whether this sort of ‘fruitbasket turnover’ in the Midwest that we’re experiencing yet again two and a half years after Order Number 2000 is going to end up with a result that is in the public interest,” Massey said.

“Perhaps it will. I hope it does, but I wonder whether we will end up with not one, but two poorly configured RTOs that have tentacles stretching in various directions,” he continued. “I’m concerned with the seams that may result from this kind of configuration…and I’m even more concerned with perhaps a squandered opportunity to improve efficient and reliable system operation in that region,” Massey added.

“I think that the Commission should clearly express its expectations to transmission owners regarding appropriate RTO scope and configuration in the Midwest and elsewhere,” Massey said.

Massey said that a possible vehicle for FERC guidance on this matter could come in the form of “virtually any order that comes along that is relevant to that region.” Under such a scenario, the Commission “could say, ‘This is the scope and configuration that we think makes some sense for that region of the country. This is a scope and configuration that we think will support good markets. This is a scope that is consistent with reliability concerns, loop flow concerns and so forth.'”

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