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Commissioner Tony Clark Statement
June 20, 2013
Docket Nos. ER13-80-000, ER13-86-000, ER13-104-000, & NJ13-2-000
Item No. E-2

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Florida Companies Order 1000 Compliance Filings

“I concur with today’s order in that I cannot find fault with the individual decisions made in response to the Florida Parties’ filing. Where there are calls to be made by the Commission, it would be difficult to find specific errors in light of the direction given in Order No. 1000.

“However, this filing raises in my mind certain broader concerns regarding the general direction Order No. 1000 takes us in relation to non-market, non-RTO/ISO regions. As I have previously written, there is much I can find worth supporting in Order No. 1000 and some of the subsequent compliance filings. Facilitating cost-effective transmission solutions, encouraging regional planning to meet customer needs and ensuring fair cost allocation are worthy endeavors. Greater standardization of those efforts would seem to hold a good deal of potential, especially in those regions of the country that have already voluntarily organized themselves into functioning RTOs and ISOs. But Order No. 1000 may not fit quite as well in certain regions of the country. Florida is a prime example.

“Order No. 1000 seeks to ensure that transmission projects are planned in a cost-effective manner and in such a way that public policy goals are met. In highly integrated regions, where there is central dispatching, locational marginal pricing, and numerous state public policies that support geographically remote sources of generation, Order No. 1000 seems a reasonable effort to ensure just outcomes.

“But in a region like Florida, I cannot help but ask if the bureaucracy imposed by Order No. 1000 may outweigh the benefits to be gained.

“The FERC jurisdictional utilities that serve Florida are vertically-integrated, monopoly utilities whose planning and operations are comprehensively regulated by the State of Florida. Integrated resource planning and facility siting, as approved by the state, ensures that generation and transmission decisions are viewed and approved holistically. The Florida utilities’ integration with the rest of the greater southeast region is limited physically due to Florida’s unique geography. There is no central dispatching entity and no LMPs to reflect local congestion. Florida utilities have exercised their right to retain control of their transmission by not choosing to join an RTO/ISO. The Florida Parties state that there are no identified public policy requirements driving regional transmission needs. Thus, in large part, the rationale for Order No. 1000 is lacking in Florida.

“Therefore, I am not entirely sure what is accomplished by Order No. 1000 in such a region. On one hand, since a good deal of integrated resource planning is already happening, there is a chance the real net effect of these changes will fall somewhere between minimally and modestly beneficial. But I fear by shoehorning Order No. 1000 into a region with existing and extensive state-led planning, we could risk the creation of an expensive, potentially litigious, and time-consuming additional layer of unnecessary bureaucracy. If this happens, the counter-productive result will not be more cost-effective and timely built transmission, but less.

“For these reasons, I respectfully concur.”