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RCA moves towards electric system progress report to Legislature
Alan Bailey Petroleum News
The Regulatory Commission of Alaska is entering the closing stages of preparing a report to the state Legislature on the status of achieving a more unified mode of operation for the Alaska Railbelt electrical system. Following a directive from the Legislature, in 2015 the commission issued recommendations for a more unified approach to the operation of the system. The commission now wants to inform the Legislature of what has happened in the past four years, potentially with suggestions on what to do next.
The Railbelt system is owned and operated by six independent utilities and the state. This balkanization of the system leads to inefficiencies that cause the price of electricity to be higher than might otherwise be the case.
During an April 10 public meeting the commissioners reflected on the status of the unification efforts, and on plans for what happens next.
Key functions There are four key functions that are needed to achieve greater unification: the mandating of a single set of reliability standards; the implementation of a transmission company to operate the electrical transmission system; the implementation of merit ordered economic dispatch for generating facilities; and the implementation of an electric reliability organization or system operator, to oversee the system and enforce the reliability standards.
Economic dispatch involves a protocol whereby continuous use is made of the most efficient available power generation units.
Commissioner Robert Pickett said that there has been progress in unifying and mandating reliability standards for the system. This progress includes a proposal to institute the Railbelt Reliability Council, a form of electric reliability organization.
Proposed statutory language The commission is uncertain whether it would have legal jurisdiction over the RRC under the terms of current state statutes and has suggested statutory language that would clarify the situation. The statute changes would also give the commission clear authority over the approval of the construction and siting of major additions to the electrical system, such as new, major generation facilities. The changes would also give the commission approval authority over regional planning for the system.
The utilities have commented on the statutory language, making observations on the technicalities of the proposed statutory changes. In general, the utilities have questioned the immediate need for the changes and have expressed concern that the requirement to have the Legislature pass new statutes could significantly delay the formation of the RRC. During the April 10 meeting Tony Izzo, CEO of Matanuska Electric Association, reiterated this concern about potential delays in the process, while also commenting that he supports the concept of legislation that would give the commission the required statutory authority over the RRC. Mark Johnson, speaking for the Arctic Railbelt Cooperative Transmission and Electric Co., a group of four of the utilities, said that the ARCTEC members substantially agree with Izzo’s views.
Less progress in other areas There has been much less progress on aspects of the unification efforts beyond the reliability standards and RRC initiative, Pickett said. For example, although a newly formed transmission company involving several of the utilities has applied to the commission for a certificate, this company does not directly commit some of the major owners of transmission assets, he said.
The commissioners expressed particular frustration at what they see as a lack of progress towards the implementation of economic dispatch. Chugach Electric Association, Municipal Light & Power, and Matanuska Electric Association had formed an agreement to implement economic dispatch across their service areas in Southcentral Alaska. But in 2018 the utilities announced an indefinite hold on this initiative because of the need to first deal with the proposed purchase of ML&P by Chugach Electric.
Commissioner Antony Scott commented that the time is approaching for policy makers to play a role in dealing with the situation. And commission Chair Stephen McAlpine said that, with four years being an adequate time frame for finding voluntary solutions, some legislative action is needed.
Next steps Pickett commented that the plan at this stage is to present to the Legislature an account of what has happened to date, perhaps sketching out a way forward from this point. There is a need to build on what has been achieved so far. Progress is being made on reliability standards and that will continue - the commission anticipates opening a regulatory docket on the standards. Pickett also said that he has spoken to the governor’s chief of staff, the speaker of the House and the president of the Senate.
The plan now is to vote on the various elements of the report to the Legislature during the next RCA public meeting. In general, the commissioners concurred with Pickett’s approach.
- ALAN BAILEY
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