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FERC in for a Fight Over RTO West
Northwest transmission-owning utilities last month filed their final proposal for Regional Transmission Organization (RTO) West with the Federal Energy Regulatory Commission (FERC) . The filing stages a battle between proponents of dominant west-wide power markets and nay sayers who claim the new organization threatens local control and promises market manipulation and other harmful consequences.
Supporters include FERC and large for-profit utilities and energy companies. Opponents include public utilities in the Northwest, state utility commissions and consumer organizations. Conservation and renewables advocates had hoped for a properly-structured RTO which could encourage energy efficiency and other cost-effective alternatives to environmentally damaging transmission projects. But the final filing removed a major provision on which clean energy advocates had pinned those hopes. RTO West is more likely to promote business-as-usual energy development.
Foes of an RTO sponsored a new report critiquing FERC's cost-benefit analysis, which makes the case that RTO formation would save money by making existing generation and transmission facilities more efficient. The counter analysis attacked FERC's assumptions and stated that the potential risks of RTO formation outweigh its benefits. The report highlighted the possibility of California -style market manipulation.
Most stakeholders predict FERC will approve RTO West with only minor changes. Opponents promise to fight in favorable venues such as state utility commissions, which must approve transfer of transmission facilities from investor-owned utilities to FERC. State utility commissions look on RTO West with considerable skepticism and it is unclear whether FERC could force utilities to join an RTO over a state's veto. The eventual fate of RTO West may rest with the Supreme Court .
— Mark Glyde & Steven Weiss