PJM Interconnection Valley Forge Corporate Center 955 Jefferson Avenue Norristown, PA 19403 2497 Robert V. Eckenrod Counsel 610.666.3184 fax 610.666.8211 eckenr@pjm.com Secretary Federal Energy Regulatory Commission 888 First Street, N.E., Room 1-A Washington, D.C. 20426-0001 Re: PJM Interconnection, L.L.C. and Progress Energy Carolinas, Inc. Docket No. ER11- -000 Dear Ms. Bose: Pursuant to Section 205 of the Federal Power Act, 16 U.S.C. 824d and the Federal Energy Regulatory Commission s ( FERC or Commission ) Regulations, 18 C.F.R. Part 35, PJM Interconnection, L.L.C. ( PJM ) and Carolina Power & Light Company d/b/a Progress Energy Carolinas, Inc. ( PEC ) (collectively, the Parties ) together hereby submit for filing a revision to its currently effective Amended and Restated Joint Operating Agreement Among and Between PJM Interconnection, L.L.C. and Progress Energy Carolinas, executed on February 2, 2010, and designated as PJM Interconnection, L.L.C., FERC Electric Tariff Rate Schedule No. 50 and Carolina Power & Light Company FERC Electric Tariff Rate Schedule No. 188 (the 2010 JOA ). The Parties are filing this revision to allow for additional time for them to develop a process to address conditions when the non-firm power flow on one of their systems causes parallel power flow on the neighboring system thereby resulting in an increase in losses, as specified in Article Thirteen of the 2010 JOA. Moreover, the Parties are requesting a waiver of the Commission s prior notice requirement as specified in 18 C.F.R. 35.3 so as to permit an effective date on less than sixty days notice, or June 1, 2011, for the revision offered in this filing. I. Background On February 2, 2010, the Parties submitted the 2010 JOA which was intended to replace a prior joint operating agreement executed by and among the parties in 2005. 1 This 2010 JOA was built upon, and incorporated much of, the prior joint operating agreement, but was intended 1 2010). PJM Interconnection, L.L.C. and Progress Energy Carolinas, Inc.; Docket No. ER10-713-000 (February 2,
Page 2 to incorporate an updated congestion management process, and was designed to be a more manageable, relevant and practical approach to joint operations between PJM and PEC. As part of the 2010 JOA, the Parties acknowledged that they had conceptually discussed the effect of non-firm power flows on one respective system that may result in an increase in losses on the neighboring system and whether such losses should result in compensation to the other. While the Parties did not come to terms on the propriety or need for such compensation, newly added Article Thirteen of the 2010 JOA reflected an understanding of the Parties to further explore the good faith development of a process to address these conditions when the non-firm power flow on one system causes parallel power flow on the neighboring system resulting in an increase in losses. To this end, both PJM and PEC agreed to work diligently and in good faith to develop such a process within one year of the effective date of the 2010 JOA, or June 1, 2011. To date, while the Parties have engaged in good-faith discussions relative to the scope, propriety and structure of such loss compensation, they have not been able to finalize a process to address loss compensation. However, because the Parties have been actively engaged in this effort over the previous year, they believe that it would be fruitful to continue these discussions prospectively. As such, the Parties have mutually agreed to extend the time for development and consideration of such a process for an additional six months, or until January 1, 2012 and, through this filing, are submitting a revision to the 2010 JOA to reflect this extension. II. The Proposed Revisions In order to effectuate the Parties agreement to extend the time for consideration of a process to address loss compensation for non-firm power flows, Article 13.3 of the 2010 JOA has been amended to allow eighteen months subsequent to the Effective Date of the 2010 JOA for the development of such a process. III. Effective Date and Waiver Request PJM respectfully requests that the Commission waive its sixty (60) day notice requirements as required by Section 35.3 of the Commission s regulations, 18 C.F.R. 35.3(a) (2008) and allow this revision to the 2010 JOA effective as of June 1, 2011. Waiver is appropriate for this revision to the 2010 JOA because it is an uncontested filing that does not seek to change rates or affect substantive third-party rights. 2 Moreover, the Parties have indicated their intention for, and support of, an effective date of June 1, 2011. In Central Hudson, the Commission held that...waiver of notice will generally be appropriate when the filing has no rate impact or reduces the rate, or when a rate increase and its effective date are prescribed by an agreement on file with the Commission or by a settlement 2 See, Prior Notice Filing Requirements Under Part II of the Federal Power Act, 64 FERC 61,139, at 61,983-84 (1993) ( Prior Notice Filing Requirements ); Central Hudson Gas & Electric Corp., 60 FERC 61,106, reh g denied, 61 FERC 61,189 (1992) ( Central Hudson ).
Page 3 agreement accepted by the Commission. 3 In the Prior Notice Filing Requirements proceeding, while the Commission adopted the rule under which the Commission will grant waiver of notice if service agreements are filed within 30 days after the service commences, the Commission retained, without further modification, all the other Central Hudson standards for waiver. 4 As a result, PJM maintains that the revision to the 2010 JOA filed herewith meets the Commission s criteria for waiver as it is an uncontested filing that does not propose to change rates. IV. Documents Submitted Along with this transmittal letter, PJM submits electronic versions of the revisions to the 2010 JOA in both marked (showing the changes) and clean forms. V. Correspondence and Communication The following individuals are designated for inclusion on the official service list in this proceeding and for receipt of any communication regarding this filing: Robert V. Eckenrod Counsel PJM Interconnection, L.L.C. 955 Jefferson Avenue Norristown, Pennsylvania 19403-2497 (610) 666-3184 eckenr@pjm.com Craig Glazer Vice President Federal Government Policy PJM Interconnection, L.LC. 1200 G Street, N.W. Suite 600 Washington, D.C. 20005 (202) 393-7756 glazec@pjm.com Danielle T. Bennett Associate General Counsel Progress Energy Service Company, LLC 410 South Wilmington Street PEB 17B2 Raleigh, NC 27601 (919) 546-5941 Dani.Bennett@pgnmail.com VI. Service PJM has served a copy of this filing on all PJM Members and on all state utility regulatory commissions in the PJM Region by posting this filing electronically. Electronic 3 4 Central Hudson, 60 FERC at 61,337. Prior Notice Filing Requirements at 64 FERC at 61,983-84.
Page 4 service is permitted as of November 3, 2008, under the Commission s regulations 5 pursuant to Order No. 714 6 and the Commission s Notice of Effectiveness of Regulations issued on October 28, 2008, in Docket No. RM01-5-000. In compliance with those regulations, PJM will post a copy of this filing to the FERC filings section of the its internet site, located at the following link: http://www.pjm.com/documents/ferc-manuals/ferc-filings.aspx with a specific link to the newly filed document, and will send an e-mail on the same date as this filing to all PJM Members and all state utility regulatory commissions in the PJM Region 7 alerting them that this filing has been made by PJM today and available by following such link. If the document is not immediately available by using the referenced link, the document will be available through the referenced link within 24 hours of the filing. Also, a copy of this filing will be available on the Commission s elibrary website located at the following link: http://www.ferc.gov/docsfiling/elibrary.asp in accordance with the Commission s regulations and Order No. 714. Likewise, PEC has served a copy of this filing on the North Carolina Utilities Commission and the South Carolina Public Service Commission by sending an email message with a link to the filing on the Commission s elibrary website. PEC will also post a copy of this filing on the Progress Energy corporate website at https://www.progressenergy.com/company/electricity-system/ferc-matters/index.page?. Respectfully submitted, Craig Glazer Vice President Federal Government Policy PJM Interconnection, L.LC. 1200 G Street, N.W. Suite 600 Washington, D.C. 20005 (202) 393-7756 glazec@pjm.com Robert V. Eckenrod Counsel PJM Interconnection, L.L.C. 955 Jefferson Avenue Norristown, Pennsylvania 19403-2497 (610) 666-3184 eckenr@pjm.com Danielle T. Bennett Associate General Counsel Progress Energy Service Company, LLC 410 South Wilmington Street PEB 17B2 Raleigh, NC 27601 Dani.Bennett@pgnmail.com 5 6 See, 18 C.F.R. 35.2, 154.2, 154.208 and 341.2. Electronic Tariff Filings, Order No. 714, 124 FERC 61,270 7 PJM already maintains updates and regularly uses e-mail lists for all PJM Members and affected commissions.
Page 5
Marked Sections
13.3 The Parties shall work diligently and in good faith to develop this process no later than one yeareighteen months after the Effective Date of this Agreement. Page 1
Clean Sections
13.3 The Parties shall work diligently and in good faith to develop this process no later than eighteen months after the Effective Date of this Agreement. Page 1