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Generators may get refunds for duplicative charges in PJM, MISO

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Generators may get refunds for duplicative charges in PJM, MISO

The PJM Interconnection and Midcontinent ISO may need to issue refunds for duplicative congestion charges imposed before the grid operators fixed their rules for pseudo-tied generators, the Federal Energy Regulatory Commission said May 16.

Pseudo-ties, which allow a generator to be controlled by a neighboring grid operator, have been criticized for being complicated and costly. But the use of pseudo-ties has grown in recent years because PJM requires generators outside of PJM’s footprint to be pseudo-tied if they wish to participate in PJM’s capacity market.

FERC has tried to resolve some of the pseudo-tie disputes by approving changes to the joint operating agreement, or JOA, between PJM and MISO. The changes made clear each grid operator’s duties in administering pseudo-ties.

Pseudo-tied generators also filed a batch of complaints saying they were charged twice for congestion fees. When FERC approved the JOA fixes, it said it would address the complaints in a separate decision.

FERC dismissed in part and granted in part five complaints against the grid operators. In partly dismissing the complaints, FERC found that the JOA fixes addressed prospective concerns about unfair charges.

But FERC also partially granted the complaints, finding that the grid operators may have imposed duplicative congestion charges before the JOA changes. Before the fixes, both regional transmission organizations could have charged a generator for congestion that occurred in the balancing authority where a generator is physically located, FERC explained.

FERC consolidated the complaints and established hearing and settlement procedures to decide if the complainants are due refunds for charges that were assessed before the JOA changes went into effect.

“The RTOs have stated, and no party disputes, that there was a potential for such overlapping or duplicative congestion charges in certain circumstances, specifically, when both markets bound on the same reciprocally coordinated flowgate under the market-to-market process,” FERC said in each order.

The companies have alleged they are due millions in refunds. For instance, Dynegy Marketing and Trade LLC and Illinois Power Marketing Co. raised concern about $4.9 million in congestion charges imposed by MISO. (FERC dockets EL16-108, EL17-29, EL17-37, EL17-54, EL17-31)

Jasmin Melvin is a reporter for S&P Global Platts. S&P Global Market Intelligence and S&P Global Platts are owned by S&P Global Inc.