On May 27, 2011, the Public Utility Commission of Texas (“Texas Commission”) held a workshop regarding Entergy Texas’ proposal to join the Midwest Independent System Operator, Inc. (“Midwest ISO”). The Midwest ISO made a presentation to the Texas Commission explaining how its system is operated and explaining the benefits of Entergy joining its system.
Representatives from the Midwest ISO told the Texas Commission that integrating Entergy into its system offers several benefits. They emphasized several features of the Midwest ISO market, including the Day 2 Market and the independent market monitor. The lengthy presentation focused on explaining the history and structure of the Midwest ISO as well as how the Midwest ISO manages dispatch, transmission planning and cost allocation to an audience unfamiliar with FERC regional transmission systems. The Midwest ISO also noted that integrating Entergy will add 15,500 miles of high voltage transmission lines, 23,000 MW of installed generation, 94 generation units and 25,500 MW of peak system demand to the Midwest ISO system.
The Texas commissioners voiced concerns about Entergy joining the Midwest ISO due to the very few transmission links between the two regions. The Texas Commission believes that joining a Regional Transmission System such as the Midwest ISO has clear benefits for Entergy. However, the lack of transmission capacity could cut off the Entergy region from potentially cheaper sources of generation in the rest of the Midwest ISO. Addressing the Texas Commission’s concerns directly, the Midwest ISO said that there already exists sufficient transfer capacity to deliver significant benefits to the Entergy region.
The Midwest ISO also said that planned transmission will bring additional benefits going forward. The Chairman of the Texas Commission asked several questions regarding how new transmission is funded, and voiced concerns about whether cost allocation issues will hinder planned transmission.
More information is available on the PUCT’s website at: www.puc.state.tx.us under Project Nos. 37344 and 39385.