Impacts of FERC Order 1000 for Public Utility Transmission Providers

FERC Order 1000 was issued on July 21, 2011, to reform the electric transmission planning and cost allocation requirements for public utility transmission providers. The Order built upon the reforms of Order 890 and corrected the shortfalls in it.

Order 1000 established three requirements for electric transmission planning:

  • Participation in the regional planning process by every public utility transmission provider.
  • Local and regional transmission planning processes to consider transmission needs driven by requirements established by state or federal laws or regulations.
  • Coordination with neighboring transmission planning regions to develop more efficient or cost-effective solutions to address mutual needs.

In addition, the Order also established the below requirements for transmission cost allocation:

  • Each public utility transmission provider must participate in a regional transmission planning process that has a regional cost allocation method for new transmission facilities selected in the regional transmission plan for purposes of cost allocation.
  • Public utility transmission providers in neighboring transmission planning regions must have a common interregional cost allocation method for new interregional transmission facilities that the regions determine to be efficient or cost-effective.
  • Participant-funding of new transmission facilities is permitted but is not allowed as the regional or interregional cost allocation method.

Eight years on, the impacts of Order 1000 have been far-reaching. Below we are going to touch upon a few of these.

The requirement for coordination with neighboring transmission planning regions to develop more efficient or cost-effective solutions introduced a need for a transmission project to assess alternatives to the traditional transmission expansion project’s approach. This includes the assessment of Non-Wires Alternatives (NWA), including Demand Response (DR) and Distributed Energy Resources (DER), to compete with conventional transmission solutions.

The technology advancements coupled with cost reductions have resulted in a broader acceptance and adaptation of these demand-side solutions by the industry. In addition, increased demand-side efficiencies and the continuing growth of distributed generation has reduced peak demands and thus transmission congestion. With the availability of NWAs, the industry has seen the cancellation of transmission expansion projects by use of distributed generation and storage resources in New York (NY) and DR programs in the Northwest.

Manage Transmission Congestion & DERs with OATI’s Solutions
OATI provides various tools to help transmission operators and utilities to manage transmission congestion. The Interchange Distribution Calculator (IDC) by OATI which assesses transmission loading and assigns relief obligations and transaction curtailments based on NERC and NAESB standards. OATI’s Distributed Energy Resource Management System (DERMS) provides for aggregation and use of the aggregated DERs, as NWA for transmission and distribution congestion relief. We believe that DERs will play an increasingly important role in the planning and operation of the power systems including congestion management, and are ready to support the industry with our solutions.

To learn about our energy industry solutions, connect with our experts at Sales@oati.net.