Utilities Challenge FERC Decision Blocking PJM Transmission Planning Changes
Transmission owners in the PJM grid region are challenging a FERC decision rejecting amendments that regulators said would give utilities excessive influence over regional transmission planning and weaken PJM’s independence.
(P&GJ) — Transmission owners operating within the PJM Interconnection grid region have asked a federal appeals court to overturn a decision by the Federal Energy Regulatory Commission (FERC) rejecting proposed changes to PJM’s governance rules that regulators said could undermine the grid operator’s independence.
The dispute stems from a proposal by utilities that own transmission lines in the PJM market to modify several governing agreements that control how the regional grid is planned and operated. The utilities argued the revisions would allow PJM to more quickly update transmission planning rules by moving the region’s planning protocol from PJM’s Operating Agreement into its Open Access Transmission Tariff.
Under the proposal, PJM would gain greater authority to make regulatory filings related to transmission planning without requiring a membership vote from the broader PJM stakeholder community.
However, FERC rejected key portions of the proposal after concluding that the amendments could give transmission owners excessive influence over PJM’s regulatory filings and long-term transmission planning decisions.
The commission determined that several provisions would allow transmission owners to delay or challenge PJM filings and would require PJM to operate in ways that prioritize obligations contained in the utilities’ Owners Agreement.
FERC also said some of the proposed amendments improperly inserted transmission planning rules into the Owners Agreement rather than the PJM tariff, where such provisions typically reside and where they are subject to broader stakeholder oversight.
Regulators further rejected language that would have applied heightened legal protections—known as the Mobile-Sierra doctrine—to much of the Owners Agreement, which FERC said would make it more difficult to challenge the provisions in the future.
The utilities and PJM had submitted the proposal as a single “integrated package,” meaning the commission could only accept or reject the plan in its entirety rather than modify individual provisions. After determining that several amendments were unreasonable, FERC rejected the package and dismissed related filings tied to the proposal.
The case now before the U.S. Court of Appeals for the District of Columbia Circuit will determine whether FERC acted reasonably in rejecting the amendments, which the commission said would concentrate control of transmission planning authority within one sector of PJM’s membership.
PJM operates the high-voltage electricity grid across 13 states and the District of Columbia and is responsible for planning and operating the region’s transmission system through its Regional Transmission Expansion Plan process.