Docket No. ER22-983-002
I dissent from today’s order as I did to the majority’s March 1, 2023 order on ISO-NE Order No. 2222 compliance (March 1 Order).[1] Today’s order does not adequately alleviate the defects to the March 1 Order. Instead, today’s order represents yet another example demonstrating that Order No. 2222 has created nothing short of an incomprehensible quagmire bearing a substantial price tag that will inevitably add to the rising power costs already faced by consumers. The First Rule of Holes is: “when you’re in one, stop digging.” The Commission’s Order No. 2222 hole keeps getting deeper.
To identify just a few points supporting my observation in paragraph 1: Today’s order begins by recognizing that the March 1 Order came four months too late for Distributed Energy Capacity Resources (DECR) to participate in FCA 18 – this, when ISO-NE had already made it clear in its February 2022 compliance filing that a November 2022 acceptance (not a March 2023 acceptance) was necessary to make that happen. This proves a point emphasized in my March 2023 Dissent:[2] the majority did not focus on the details and reasoning ISO-NE provided in its original February 2022 compliance filing.[3] That ISO-NE was forced to make another filing with the Commission to point out what it had already told the Commission is not only an exercise in duplicative effort, it is not cost free. It takes time and effort to make filings before the Commission and those efforts took ISO-NE and its market participants away from the many other important efforts in which they are engaged. I fear the rest of today’s order may lead to more of the same.
I am concerned whether the purported clarification offered by this order adequately responds to concerns raised in the filings before the Commission today (or may even raise new concerns). Specifically, both ISO-NE and New England Public Utilities[4] came to the Commission seeking relief from the March 1 Order’s findings, including the finding that the DER Aggregator is responsible for submitting settlement data to the ISO.[5] ISO-NE explains that:
In the Compliance Order, the Commission rejected the proposed Tariff revisions providing for the Host Utility or its Assigned Meter Reader, rather than the DER Aggregator, to be responsible for providing metering data to the ISO for settlement purposes. The ISO understands the Commission’s finding to mean that the process for the flow of metering data for DERAs to the ISO is to exclude Host Utilities, and therefore, the ISO requests that the Commission grant rehearing.[6]
I can see how ISO-NE came to this understanding. The March 1 Order stated:
[W]e find that ISO-NE’s proposed metering and telemetry requirements partially comply with the Commission’s requirement in Order No. 2222 that the distributed energy resource aggregator is the entity responsible for providing any required metering and telemetry information to the RTO/ISO. Consistent with this requirement, DER Aggregators are responsible for providing telemetry information to ISO-NE. However, with respect to metering, we find that ISO-NE’s proposal does not comply with Order No. 2222 because the Host Utility, and not the DER Aggregator, will generally be responsible for providing metering information to ISO-NE. While ISO-NE explains that a Host Utility may designate an agent—which could include a DER Aggregator—to help fulfill Assigned Meter Reader duties, ISO-NE’s proposal does not designate the distributed energy resource aggregator as the entity responsible for providing any required metering information to the RTO/ISO, as Order No. 2222 requires. . . . Accordingly, we direct ISO-NE to make, within 60 days of the date of issuance of this order, a further compliance filing that revises its Tariff to designate the DER Aggregator as the entity responsible for providing any required metering information to ISO-NE.”[7]
While ISO-NE’s interpretation appears to have been the direct result of the words used in the March 1 Order, today’s order “disagrees” with ISO-NE[8] and purports to clarify that “our directive in paragraph 169 does not preclude the Host Utility from having a role in this process.”[9] Consistent with the “daunting complexities” created by Order No. 2222, its progeny and other Order No. 2222 compliance orders,[10] today’s order adds to those complexities by dropping in the lap of the ISO and market participants this clarification without providing substantive and meaningful explanation that this statement can or does resolve each of the significant problems and concerns identified by ISO-NE.[11] Instead, today’s order not only uses the “clarification” as a sword to dispense with the rehearing request, but also as a shield from providing substantive explanation on how this “clarification” addresses each of ISO-NE’s problems and concerns, instead suggesting that because a clarification was provided, ipso facto those concerns are “resolved.”[12]
As a result, certain at this point is that today’s order will compel yet another return to the drawing board for ISO-NE and its market participants in order to consider the ramifications of this clarification. So these entities, which have undoubtedly already invested ample amounts of time and money in the name of Order No. 2222 compliance, will be required to invest still more of both. On the other hand, we will not know with certainty until the ISO and others have the opportunity to digest this clarification, whether it can resolve each of the issues raised by the ISO-NE and New England Public Utilities’ Rehearing Requests or whether it has created additional concerns.[13]
Moreover, ISO-NE and New England Public Utilities – albeit from different perspectives and to support arguments related to different paragraphs of the March 1 Order – each raise arguments concerning the costs and expense associated with the Commission’s March 1 Order.[14] The determination in this order appears only to address directly the argument made in the New England Public Utilities Rehearing Request and, even with respect to that argument, offers no insight beyond a conclusion that the argument is “premature.”[15]
I too have noted on multiple occasions that Order No. 2222 compliance will result in significantly higher costs that undeniably will be borne by consumers.[16] It appears that New England Public Utilities’ cost arguments are related to the parts of the March 1 Order on which I too spent time in my dissent – those dealing with metering issues. I drew a similar conclusion to that which today’s order appears to suggest New England Public Utilities draw in their filing.[17] In my March 2023 Dissent I observed:
While the majority’s request for additional information appears odd against this backdrop, the remainder of the order may make the reasoning clearer: rather than an explanation from ISO-NE, it appears that the majority hopes the ISO will return with a completely different proposal on metering. Specifically, after setting forth the majority’s view that ISO’s proposal requires an explanatory filing, today’s order twice makes reference to what other RTOs have proposed and then ultimately suggests to ISO-NE: “Notwithstanding these findings, we note that, in ISO-NE’s discussion of the steps contemplated to avoid imposing unnecessarily burdensome costs on DER Aggregators and individual resources in DERAs that may create an undue barrier to their participation in the ISO-NE markets, ISO-NE may consider alternatives to solely relying on meter data obtained through compliance with distribution utility or local regulatory authority metering system requirements and/or existing telemetry infrastructure.”[18]
Here’s the reality: No matter when the Commission determines to acknowledge the concerns expressed in this docket (and others) about the costs of Order No. 2222 compliance, the writing is already on the wall in permanent marker; Order No. 2222 compliance will surely cost consumers dearly at a time many are already struggling with rapidly rising power bills.
For these reasons, I respectfully dissent.
[1] ISO New England Inc., 182 FERC ¶ 61,137 (Christie, Comm’r, dissenting) (2023) (March 2023 Dissent) (available at https://www.ferc.gov/news-events/news/commissioner-christies-dissent-order-iso-nes-order-no-2222-compliance-filing-er22).
[2] See, e.g., id. PP 8-11.
[3] In its February 2, 2022 compliance filing, ISO-NE not only made it clear that a November 1, 2022 effective date was required to permit DECR participation in FCA 18 but that such effective date necessitated complete acceptance of and action by the Commission on that filing, no later than November 1, 2022. Nonetheless, today’s order seems to suggest that ISO-NE’s latest filing added valuable information that the Commission did not previously have. Compare ISO-NE February 2, 2022 Compliance Filing at 43 (“First, the Filing Parties request that the rules for DECR participation in the FCM, the SGIP amendments, and certain definition changes become effective November 1, 2022. This will allow for DECR participation in time for [FCA 18] and certainty for DER developers with respect to interconnection jurisdiction going forward. FCA 18 is the first auction in which DECRs can reasonably participate as the process associated with seventeenth FCA is already underway. Allowing participation in the earliest possible FCA was requested by stakeholders during the compliance process.”) (emphasis in original); id. (“The Filing Parties respectfully request that the Commission accept the complete Compliance Proposal, without amendment or condition on or before November 1, 2022, to allow for the ISO to implement FCM specific rules in time to allow for DECR participation in FCA 18. Approval of the complete Compliance Proposal will provide Project Sponsors with a reasonable understanding of their rights and obligations in the energy and ancillary service markets when taking on a Capacity Supply Obligation in FCA 18 with DECRs comprised of DERAs.”) (emphasis in original and emphasis added), with ISO New England Inc., 185 FERC ¶ 61,021 at P 12 (2023) (“Order”) (“ISO-NE persuasively explains that it is infeasible for ISO-NE to allow Distributed Energy Capacity Resources to participate in FCA 18. As ISO-NE explains, because the Commission did not act on ISO-NE’s Order No. 2222 compliance filing until March 1, 2023, ISO-NE was not able to complete in advance of FCA 18 required implementation activities relating to Distributed Energy Capacity Resource participation in that FCA.”) (footnote omitted).
[4] New England Public Utilities are comprised of National Grid USA (on behalf of Massachusetts Electric Company, Nantucket Electric Company, and New England Power Company), Avangrid Networks, Inc. (on behalf of Central Maine Power Company and The United Illuminating Company), and Eversource Energy Service Company (on behalf of The Connecticut Light and Power Company, Public Service Company of New Hampshire, and NSTAR Electric Company).
[5] See, e.g., March 31, 2023 ISO-NE Request for Rehearing at 1, 10-11 (ISO-NE Rehearing Request) and New England Public Utilities March 31, 2023 Requests for Rehearing and Clarification at 6-7 (New England Public Utilities Rehearing Request).
[6] ISO-NE Rehearing Request at 10 (citing March 1 Order, 182 FERC ¶ 61,137 at P 169) (footnote omitted).
[7] March 1 Order, 182 FERC ¶ 61,137 at P 169 (emphasis added) (footnotes omitted).
[8] Order at P 22 (“We disagree with this underlying interpretation upon which ISO-NE bases its rehearing request.”).
[9] Id.
[10] See, e.g., Participation of Distributed Energy Res. Aggregations in Mkts. Operated by Reg’l Transmission Orgs. & Indep. Sys. Operators, 175 FERC ¶ 61,156 (2021) (Christie, Comm’r, concurring at P 3) (“[T]he motion filed by ISO-NE illustrates the daunting complexities and certain increased costs to consumers, which I referenced in my dissent to Order No. 2222-A and which apply equally to its forebear, Order No. 2222. The problems and complexities of compliance described in ISO-NE’s Motion are further evidence that implementing Order Nos. 2222 and 2222-A will be far more complicated, far more costly to consumers and far more burdensome to states, public and municipal power authorities, and electric co-operatives, than these orders and many of their supporters acknowledge.”) (footnote omitted) (available at https://www.ferc.gov/news-events/news/commissioner-mark-c-christie-concurrence-regarding-order-granting-compliance-0).
[11] For example, today’s order offers no substantive explanation as to what extent it can or will resolve issues raised by ISO-NE’s Rehearing Request concerning: whether the March 1 Order contravenes the Transmission Operating Agreement (TOA) and Tariff and is contrary to precedent (ISO-NE Rehearing Request at 12-16 & n.38); double-counting (id. at 18-19); inaccuracies in the settlement data (id. at 12); duplicative efforts and expense in settling the market (id.); and the accuracy of reporting information provided to the ISO (id. at 16).
[12] Order at P 22 (“Because we are providing clarification that the Commission’s decision does not preclude metering data coming from or flowing through the Host Utility, provided that ISO-NE establish certain protocols as discussed below, we note that this resolves ISO-NE’s concerns that the Commission’s decision (1) contravenes the TOA, (2) conflicts with other Order No. 2222 requirements, and (3) would result in the imposition of substantial burdens. For the same reason, we do not address ISO-NE’s arguments that the Commission’s directives could conflict with ISO-NE’s settlement process or state policies, or that the Commission could accept ISO-NE’s proposal under certain Commission standards.”) (footnote omitted). This attempted explanation falls far short. Moreover, the protocols today’s order references may themselves lead to additional costs, an issue about which ISO-NE and others in this docket – and about which I – have raised concern. See infra at PP 7-9.
[13] And this clarification will not resolve the issues I raised in my March 2023 Dissent, including those addressing metering and implicating measurement and verification concerns. March 2023 Dissent passim.
[14] While not accepted by the Commission in this order, the Massachusetts Attorney General (Massachusetts AG) and the Maine Public Utilities Commission (MPUC) filed answers in which they also raised concerns about costs that could be ascribed to their consumers. See, e.g., Massachusetts AG April 14, 2023 Answer to New England Public Utilities Rehearing Request at 3 (“DER aggregators and program participations should bear the risks and costs of submetering and the administrative infrastructure necessary to support it. Ratepayers, who are not participating in DER aggregations, should not bear these costs. These costs are business expenses of DER aggregators and must be allocated to those that benefit financially from DER aggregations.”) (footnote omitted); MPUC May 5, 2023 Answer to ISO-NE Rehearing Request at 6 (“The MPUC submits that making DERAs exclusively responsible for transmitting DER aggregation metering data to ISO-NE would likely impose a substantial (and unnecessary) burden on Maine ratepayers . . . . Maine’s transmission and distribution utilities already have existing infrastructure, including AMI, included in their retail rates, such that adoption of additional metering equipment requirements could impose unnecessary additional cost. Moreover, to the extent that additional distribution utility staff and computer system upgrades would be necessary to accommodate consolidation of third-party DER aggregation metering data into retail ratepayer billing, the costs for these additional resources would be unreasonably burdensome to Maine ratepayers.”) (emphasis in original). While today’s order finds that neither of these filings is properly before the Commission, my point is that costs are not a concern that just a few parties have raised, nor are they a concern that impacts only a single aspect of the energy markets. Similarly, the out-of-time intervention and answer by the New England Conference of Public Utilities Commissioners (NECPUC) rejected by this order also sought, among other concerns, to make arguments about costs. See, e.g., NECPUC May 22, 2023 Notice of Late Intervention and Answer to ISO-NE Rehearing Request at 6 (“In addition, NECPUC is concerned that designating DERAs exclusive meter reporting may require the overhaul of existing metering infrastructure which has implications for distribution-level system costs and operation.”).
[15] Order at P 30.
[16] See, e.g., supra n.10; March 2023 Dissent at 4 (“That the costs associated with Order No. 2222 compliance will be enormous and paid by the consumer is something that cannot be denied. Equally obvious to me, is that these costs will be driven by the very complexities of the resulting grid upgrades required by this Commission in that order. . . .”); Participation of Distributed Energy Res. Aggregations in Mkts. Operated by Reg’l Transmission Orgs. & Indep. Sys. Operators, Order No. 2222-A, 174 FERC ¶ 61,197 (2021) (Order No. 2222-A) (Christie, Comm’r, dissenting at PP 1, 4) (“[T]he majority also sides against the consumers who for years to come will almost surely pay billions of dollars for grid expenditures likely to be rate-based in the name of ‘Order 2222 compliance.’ . . . A rapid concentration of behind-the-meter aggregated DERs at various locations on the local grid will inevitably require costly upgrades to a distribution grid that has largely been engineered to deliver power from the substation to end-user retail customers. Meeting the technological challenges of this re-engineering of the local grid are not insuperable but there are substantial costs and we all know these costs will ultimately be imposed on retail consumers.”) (footnotes omitted) (available at https://www.ferc.gov/news-events/news/item-e-1-commissioner-mark-c-christie-dissent-regarding-participation-distributed).
[17] Order at P 30 (“New England Public Utilities mischaracterize the March 1 Order as requiring ISO-NE to modify its metering proposal.”).
[18] March 2023 Dissent at PP 11-12 (quoting March 1 Order at P 172) (emphasis in original) (footnotes omitted).