RTO advocacy update

The RTO advocacy effort is off to a good start. As you recall, I sent out a request for information last week to a few of you in the field asking for the following:

a summary of the stakeholders who are raising concerns with the FERC RTO model
an outline of their arguments/criticisms/concerns, and
a list of priority issues that need addressing

The feedback was tremendous, and it included useful comments in regard to how we might better improve the delivery of our RTO message.

Due to the increasing concerns and waivering support among Members of Congress, Governors, state utility commissions, legislators and other stakeholder groups in regard to the FERC RTO model it is imperative that we develop a sound strategy and strong arguments around the RTO issue.

Toward that end, I have summarized your comments and am coordinating with our friends at Tabors Caramanis and Frontier Economics on the development of materials that can be used in your upcoming meetings with stakeholders.

The first set of documents will address the following issues:

A side-by-side graphic of the FERC RTO model v. the utility 17+ RTOs accompanied by an explanation of power flows that builds on Tabors Caramanis work on natural markets which support the FERC model.
Reliability Document - this document will start with a brief history of the NY blackouts, the state's inability to deal with reliability and how and why the federal government became involved, the role of NERC. The synopsis will finally address the red herrings associated with reliability issues and the benefits to reliability as a result of implementing the FERC model. It will also briefly address control issues for states and real-time reliability.
Economics - This summary will show examples of historical cost savings of aggregation; it will highlight cost savings potential, and also identify peculiar left-over costs of how certain systems grew and the costs were never eradicated.
The Hit List - This document will address issues such as environmental arguments; eminent domain; implementation issues; cost shifts to people during transitions; infrastructure/software concerns; and other issues that are raised as a reasons not to implment the FERC RTO.
The well-designed RTO - Using specific analogies we will outline how other similar interstate issues work (the short-term and long-term issues to planning); reasons to avoid balkanization; and we will identify the key elements of a well-designed RTO.
Governance Issues - Here we will address the issue of independent boards not beholden to commission interests; we'll show how the state isn't really losing control that in fact there will be a diminished role for commissions and legislators; we'll attempt to distinguish between regional led organizations v institutional (using water issues/planning in the Northwest as an example; We'll draw from history and look at NE and PJM and how organizations like NECPUC were formed.
Environmental Issues - We're first going to develop an outline to see whether a document is necessary. But some of the issues to be addressed are air quality benefits and NIMBY issues.

Understand that the above is a simplified and very narrow list of issues. It is not an exhaustive list of what we need to address - it's only a start based on your comments.

I will coordinate with TC and FE on timeframe for delivery, but I am expecting a draft set of documents by September 7th.
I will identify approximately 5 people from our RTO Team to review the draft documents and weigh in with comments.
I will provide everyone with a set of final documents by mid-September.

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AS PART OF OUR RTO ADVOCACY EFFORT, I WILL BE ASSIGNING WEEKLY DELIVERABLES TO PEOPLE. PLEASE KEEP AN EYE OUT FOR THESE EMAILS - THEY WILL USUALLY BE SENT OUT ON FRIDAY MORNINGS AND DUE THE FOLLOWING MONDAY.

Since Monday is Labor Day I am assigning this week's deliverable today and it will be due by Tuesday, September 4th.

Deliverable
Please provide me with a complete list of upcoming meetings you have scheduled where the RTO issue will be discussed. Specifically, I am looking for the date and who the meeting is with. This deliverable includes presentations you are making at conferences and the like.

Thank you!!!