RTO Fever Energizes FERC Agenda As New Chairman Takes Reins.(Teh agency moves to form regional transmision organizations)(Brief Article)

The Federal Energy Regulatory Commission (FERC), under new chairman Pat Wood III, appears to have put its campaign to organize the nation's electric power transmission under a handful of large regional transmission organizations (RTOs) into high gear, promising to set a new tone for an agency that in the past has been criticized as a lumbering bureaucracy.

To facilitate the process, FERC held what it called "RTO Week" October 15-19, consisting of a series of workshops to address market design and structure and other core issues. Among those attending were state regulatory commissioners, energy company representatives, consumer advocates, members of the financial community, academics, and others.

The sessions revealed that there were more questions than answers, that further definition and standardization of RTO functions were needed, and that FERC needed to give more guidance on specific functions. Most of all, it seems apparent that FERC needs to strengthen relations with states, giving them greater opportunity to participate.

State Representation Needed

For example, some panelists suggested that FERC initiate a joint board or advisory panel composed of representatives of states. They also suggested that the agency set a realistic time table, taking into account that states may have their own time and schedule restrictions that might limit participation.

In response to those suggestions, FERC Commissioner Nora Mead Brownell, a former Pennsylvania regulatory official, moved quickly to propose just such a regional council that would share authority between FERC and states on setting RTO policies, according to a Reuters news story. Citing states' confusion about FERC's direction and inconsistent internal agency communication, Brownell, in a memo to commissioners, said the council "can provide the necessary flexibility that we will likely need moving forward to RTO formation."

But while some sought to derail any fast-track RTO actions, others cautioned that the process should not delay efforts by existing ISOs to fix market problems now. On the other hand, several representatives from Midwestern states favored quick action to establish an RTO for their region.