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RCA drafts statutory changes needed for reliability standards
Alan Bailey Petroleum News
As part of continuing efforts to achieve a more unified approach to the operation of the Alaska Railbelt electricity system, on March 13 the Regulatory Commission of Alaska held a public meeting to review progress towards unification. The commission is in the process of formulating a letter to the state Legislature, documenting the status of unification efforts and recommending future actions. In association with that letter, the commission is also suggesting some changes to Alaska statutes that may be needed to lubricate the process.
Overseeing the grid At the core of the issues being addressed the commission sees the need for a unified set of enforced reliability standards for the system, with a system-wide organization to manage the standards and their enforcement. This hooks into the perceived need for a single organization that would oversee the operation of the grid - the electrical system is owned and operated by six independent electricity utilities and the state of Alaska. A particular area of contention is the governance of such an organization, and the relative influence of the utilities, the state and other stakeholders in the system. At stake are issues such as the ability of independent power producers to hook up to the grid. The overall objective is to minimize the cost of electricity while maintaining acceptable levels of supply security.
In April 2018 the utilities filed a unified set of reliability standards for the entire Railbelt. However, there is, as yet, no regulatory procedure for enforcing or approving these standards. Then, in the fall of the same year the utilities announced that they had signed a memorandum of understanding for the formation of an entity called a Railbelt Reliability Council, or RRC, to enforce reliability standards for the system; enforce system-wide interconnection protocols for the grid; conduct system-wide integrated resource planning; and evaluate the economic dispatch of power generation in the system.
Since then the RCA has been wrestling with issues regarding the agency’s regulatory authority over the proposed RRC and regarding the most effecting way of enforcing the reliability standards.
A need for efficiency During the March 13 meeting Commissioner Robert Pickett commented that, if the commission itself were to maintain the standards and have a rulemaking process for every change to the standards, the result would be a major increase to the commission’s regulations and an overly burdensome procedure for standards maintenance. Instead, the commission is leaning towards the formation of an organization like the proposed RRC to maintain the standards, with the standards being part of the organization’s tariff, subject to RCA approval. The concept is similar, albeit on a smaller scale, to the manner in which at the federal level the North American Electric Reliability Corp. operates under the jurisdiction of the Federal Energy Regulatory Commission.
But, although the RCA has clear jurisdiction over electricity reliability standards, there are questions over whether, under Alaska state law, the commission would have jurisdiction over all of the operations of an organization like the RRC. One question, for example, is whether the commission has the authority to delegate standards maintenance and enforcement to some entity, that then has enforcement authority over multiple utilities. Currently, the commission simply regulates individual utilities.
Suggested statute changes Commissioner Antony Scott is in the process of drafting some suggested state statute changes that could bring clarity to this regulatory conundrum. Based on federal statutes relating to the FERC/NERC relationship, the statutory language would establish a clear legal framework within which an organization such as the RRC could operate and how, in general terms, it would be governed. The language would also incorporate the legal basis under which the organization could conduct region-wide planning for generation and transmission assets.
Pickett emphasized that the intent is to suggest statutory changes and not to propose a bill. A bill would need to be introduced either by the governor’s office, or by a member of the Legislature.
The commissioners passed a motion setting a 20-day period for comments on the suggested statutory changes. Pickett said that the commission hopes to have its letter on the status of grid unification to the Legislature by mid to end April.
- ALAN BAILEY
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