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1 RTWG Tariff update to the BOD, MOPC, SPC, and RSC January 4, 2005.

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Presentation on theme: "1 RTWG Tariff update to the BOD, MOPC, SPC, and RSC January 4, 2005."— Presentation transcript:

1 1 RTWG Tariff update to the BOD, MOPC, SPC, and RSC January 4, 2005

2 2 RTWG Tariff Update  Where are we in the process  What is the expected timeline for completion  Review of the proposed tariff changes

3 3 Overview  RTWG is making changes to the tariff to implement the RSC approved Participant Funding plan  Clarifications or fundamental questions regarding the plan are referred back to the RSC/CAWG  RTWG is NOT discussing the merits of the plan

4 4 A Review of the RSC Plan  100% of the costs of approved Base Plan upgrades are recovered through the tariff  The Plan defines the rules for how an upgrade is included in the Base Plan  RTO approved reliability upgrade  Upgrades required by a Network Customers to receive power from a new DNR if upgrades meet certain criteria

5 5 RSC Plan (cont)  Conditions for Base Plan Treatment of upgrades for new DNRs  Minimal cost (<$100,000)  DNR must be a 5yr or longer firm entitlement  Customer can not exceed a 125% reserve margin  Upgrade costs capped at $180,000/MW  The Plan does allow for SPP to waive some or all of the above conditions

6 6 RSC Plan (cont)  Waiver requirements  Customer must request the waiver and give supporting documentation  SPP staff will review the waiver request  SPP staff will then present the waiver request and its recommendation to the MOPC  MOPC will pass the waiver, the SPP staff recommendation and its recommendation to the BOD  SPP BOD will decide on the waiver request  The customer has the right to present their position at all levels

7 7 Required Tariff Changes  The RSC Plan calls for major changes in rate design  Will have a two tiered rate:  Current Zonal Charge – For customers that take service under the tariff  Base Plan Charge –applied to all load in SPP for recovery of Base Plan upgrade costs with regional and zonal components  Facilities not eligible for Base Plan treatment directly assigned with revenue credits  A new schedule is required to implement the plan  The remaining changes are primarily in rewriting Attachments H, J, L & S

8 8 Issues Still Before the RTWG  Outstanding questions posed to the RSC/CAWG  Can a customer recover any directly assigned costs as a credit pursuant to Attachment Z?  How should the Credits for delayed or deferred Base Plan Projects be calculated? (RR or Cost)  Should project costs of < $100,000 be directly assigned to the host zone or split between the Regional and zonal rates?  Finalize remaining tariff language

9 9 Possible Reasons for Delaying a Filing  Delayed response from RSC/CAWG to outstanding questions  Responses from RSC/CAWG require major changes to proposed language  A problem in the proposed tariff language is discovered at the last minute  RSC/CAWG request changes to the proposed tariff language  Proposed Language is not approved by the MOPC and/or the BOD

10 10 Time Table  RTWG meets this week to try and finalize the tariff language  Targeted to get language to MOPC and BOD for their review and approval at their respective January meetings  December FERC filing provides for January policy review and February implementation of any directives  SPP committed to file by March 1

11 11 Questions???

12 12 Transmission Cost Allocation Proposal – SPP Tariff Modifications January 4, 2005

13 13 Implementation of Proposal  Need to modify the Tariff to:  Allocate costs for new transmission upgrades  Establish rates for collecting the costs  Recover and distribute the TOs revenue requirement  Document new defined terms

14 14 Major Tariff Changes for Implementation of Cost Allocation Proposal  Modify Attachment J – Recovery of Costs Associated with New Facilities  Presently includes sunset provision for roll-in  Allocates costs for new upgrades  Add Part V & Schedule 11 – Base Plan Charge  Establishes rates and applicability of the rates to recover TOs revenue requirement for new upgrades  Modify Attachment L – Treatment of Revenues  Distributes revenues collected under Schedule 11 to the TOs

15 15 Attachment J Cost Allocation Provisions  Base Plan Upgrades  Economic Upgrades  Requested Upgrades  Provides a link to existing Attachment Z, Aggregate Transmission Service Study Procedures  Generation interconnection related Network Upgrades  Provides a link to existing Attachment V, Large Generator Interconnection Procedures

16 16 Attachment J Other Provisions  Review of the regional allocation factor & zonal allocation methodology at least once every 5 years  Conditions for including future DNRs as Base Plan Upgrades (Safe Harbor)  Waiver process for DNRs that do not meet the Safe Harbor conditions  Intra-zonal allocation review process  Cost allocation provision for Network Upgrades that defer or displace the need for a Base Plan Upgrades

17 17 New Part V – Recovery of Costs for Base Plan Upgrades  Establishes a “new” charge (Base Plan Charge) to collect the revenue requirement for Base Plan Upgrades & any portion of other Network Upgrades that are eligible for Base Plan Upgrade treatment  Sets out applicability of the charge  Provides a link to new Schedule 11 that sets out the rate/charge

18 18 Applicability of Base Plan Charge  The intent is to apply this charge to ALL load within the SPP footprint:  Load currently taking network service under the SPP Tariff; and  To all other load that is not currently taking service under the SPP Tariff  Bundled retail load for which Transmission Owners have not requested service under the SPP Tariff  All load being served under Grandfathered Agreements  To Transmission Customers taking P-to-P under the SPP Tariff

19 19 New Schedule 11 – Base Plan Charge  Charge to Network Customers & TOs for load is assessed on a load ratio share basis  Charge to Transmission Customers taking P-to-P under the SPP Tariff is based on Reserved Capacity  Zonal component & regional component assessed for load & for P- to-P

20 20 Attachment L – Treatment of Revenues  Currently establishes distribution of revenues to TOs collected by SPP for transmission service and other services  Adds new provision for distribution of revenues to TOs collected by SPP under new Schedule 11  In proportion to their respective ATRRs for new transmission upgrades

21 21 Other Tariff Changes  Section 1 – Definitions  Attachment H – Annual Transmission Revenue Requirement  Attachment S – Procedure for Calculation of MW-Mile Impacts  Provisions governing revenue distribution in the event of customer non-payment

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