States question whether power grid operator watches out for consumers

Back to All News

States question whether power grid operator watches out for consumers

August 16, 2015

Con­sum­er pro­tec­tion is get­ting short-cir­cuit­ed on the Midwest e­lec­tric grid, ac­cord­ing to reg­u­la­to­ry watch­dogs in Minnesota and oth­er states.


State of­fi­cials, in­clud­ing Minnesota Commerce Com­mis­sion­er Mike Roth­man, whose agen­cy regular­ly chal­len­ges utility rate hikes, say they lack the mon­ey and legal fire­pow­er to en­gage power­ful u­til­i­ty in­ter­ests in com­plex, multistate reg­u­la­to­ry bat­tles over grid and trans­mis­sion costs.


The out­come of these ob­scure, high-stakes reg­u­la­to­ry ac­tions, in­clud­ing one that goes be­fore an administrative judge in Washington, D.C., on Mon­day, can cost e­lec­tric rate­pay­ers hun­dreds of mil­lions of dol­lars.


“It is sig­nifi­cant to the public in­ter­est,” Roth­man said in an inter­view about con­sum­er protection con­cerns that Minnesota and four oth­er states raised in July with the Federal Energy Regula­to­ry Commission (FERC), which over­sees the pow­er grid. “It is a significant is­sue.”


A lar­ger group of states, including Minnesota and led by I­o­wa’s Office of Con­sum­er Ad­vo­cate, has forged a loose coa­li­tion to chal­lenge what it alleges are ex­ces­sive trans­mis­sion-re­lated charges authorized by fed­er­al regu­la­tors on the pow­er grid ser­ving 15 states.


Some states, also including Minnesota, seek a fed­er­al in­ves­ti­ga­tion of al­le­ga­tions that the grid’s man­ag­er, the Midcontinent Independent System Operator (MISO), im­prop­er­ly struc­tured a com­pe­ti­tive bid­ding proc­ess and al­lowed an en­er­gy com­pany to ma­nipu­late the e­lec­tric­i­ty mar­ket, re­sul­ting in high­er rates to con­sum­ers in Il­li­nois. MISO, along with its mar­ket mon­i­tor and the en­er­gy com­pany, Dyn­egy, have de­nied any­thing im­prop­er hap­pened in what is known as a “ca­pac­i­ty auction.”

SOURCE:  Star Tribune

Related Information