WASHINGTON (Bloomberg) — The U.S. Federal Energy Regulatory Commission started talks with representatives from utilities, power generators, transmission companies and 11 Northeast state governments on creating a regional electricity grid from Bangor, Maine, to Washington.
The FERC asked electricity-transmission groups earlier this month to combine proposals to create regional transmission organizations in the Southeast, Northeast, Midwest and West to open and expand electricity markets.
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“Anything that increases access to the grid and that would create a more viable wholesale market, we see as progress,” said Buddy Eller, a spokesman for Mirant Corp., an Atlanta-based power and natural gas trader that is planning to build power plants in the New York area.
Administrative Law Judge H. Peter Young heads the Northeast talks. Negotiations on the Southeast organization began last week.
Young said in opening remarks that the goal of the talks would be to fashion a “detailed business plan” and draw up “the rules for the road” in combining the Northeast electricity markets.
To promote a frank discussion among dozens of participants involved, Young said the talks would be conducted on “a confidential basis.”
The Northeast grid, serving about 52 million people, would become the world’s largest, ahead of systems in France and Japan. The Northeast is now served by three separate grids, one for New England, one for New York and one for the mid-Atlantic states of New Jersey, Pennsylvania, Delaware and parts of Maryland, as well as Washington, D.C.
The system would connect about 1,000 power plants that can generate as much as 105,000 megawatts in New York, New Jersey, Pennsylvania, Delaware and Maryland and the New England states of Maine, Vermont, Massachusetts, Rhode Island, New Hampshire and Connecticut. A megawatt can light about 1,000 U.S. homes.
‘Good for consumers’
“We are a delivery company, and we think a larger regional market for buying and selling electricity will be good for our customers,” said David Allen, a spokesman for the Central Maine Power Co., the state’s biggest electricity company with 544,000 customers.
The plan faces obstacles, said David Owens, executive vice president for the Edison Electric Institute, an industry trade group. “There are jurisdictional issues, technical issues and business issues,” he said.
Three independent system operators and 11 state regulatory agencies present “jurisdictional and political problems that have to be resolved,” Owens said.
Resolving administrative and technical differences among the three systems, “or smoothing the seams,” is complex and not easily solved, he said.
Maureen Helmer, chairwoman of the New York State Public Service Commission, said she supported the effort to create a regional market but expressed concern that the new system must be “designed to incorporate local requirements” and that “consumers must be protected through effective market monitoring.”
The New England Independent System Operator in the spring proposed a regional transmission organization. FERC rejected the plan as too limited.
The New England operator was “disappointed,” spokeswoman Ellen Foley said at the time. Now, “We are moving ahead, supporting the process,” she said this week.
