On March 13, ISO-New England (ISO-NE) issued a statement on S. 2660/ H.R. 5547, the Sanders-Snowe Consumer Protection and Cost Accountability Act, indicating that the legislation was unnecessary, because consumer protections are already in place. S. 2660/H.R. 5547, essentially, would expand the mission and function of ISOs and RTOs to include facilitating the provision of "reliable service to consumers at the lowest reasonable cost" and require cost-benefit analysis for market rule changes. The ISO statement, circulated to all New England congressional offices, said these changes are “unnecessary - and could jeopardize achievement of New England's energy, economic and environmental policy goals.” Moreover, ISO-NE says that effective electricity markets are in place, and, therefore, the purpose of the bill has already been achieved.
Specifically, ISO-NE took issue with the provision to mandate a cost-benefit analysis of market changes, saying it was ambiguous and could have “unintended consequences.” Congressional staff explained that they purposely left the “cost-benefit" criteria undefined – to allow proposals to take into account longer-term environmental issues, such as development of renewable resources, which is important to the bill’s sponsors. The bill does not bind the ISO’s or RTO's hands, but leaves them relatively free to pursue initiatives that they think are necessary (environmentally or otherwise). However, RTOs and ISOs would be required to spell the costs/benefits out in their FERC filings.
Public power’s response to the ISO statement was simple: we fail to see how “putting the consumer back in the equation” is a bad thing. If the markets are truly working for consumers, meeting requirements of the bill should be an easy bar to jump.
In a related development, at a March 20 NEPOOL Competition Working Group meeting, NEPOOL discussed the RTO legislation and indicated that it plans to prepare draft comments on the bills. The group suggested that NEPOOL Counsel would draft comments in consultation with Sector Vice-Chairs; then the NEPOOL Participants Committee will vote on the comments, at a later date.
For a copy of the IS0-NE statement on the bill, please contact Lori Pickford at Morgan Meguire.