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FERC Approves CAPS Funding by PJM Customers

March 2, 2016 By Cheryl Kaften

On February 29, the Federal Energy Regulatory Commission (FERC) accepted revisions to the PJM Open Access Transmission Tariff (Docket No. ER16-561-000) to provide a mechanism for funding the organization, Consumer Advocates of the PJM States (CAPS), effective March 1, via a new charge on customers’ bills.

The request had been filed last December 18 by the regional transmission organization, PJM Interconnection – which coordinates the movement of wholesale electricity for 61 million customers in all or parts of Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, West Virginia and the District of Columbia.

Estimates are that the charge would be a barely-there eight-tenths of a cent per year for a residential customer using 1,200 kilowatt hours (kWh) annually.

In its formal request, PJM states that CAPS is a non-profit organization formed to coordinate the participation of state consumer advocate offices in the PJM stakeholder process. The group’s annual budget is $450,000.

While a number of consumer advocacy organizations – among them, Public Citizen and the Sustainable FERC Project – support the new CAPS Funding Schedule because it will “enrich the stakeholder process with a reasonable voice and consumer perspective,” in the words of the latter; the request had several detractors, as well.

Protestors argued that the proposal would unlawfully compel PJM transmission customers that serve load to pay charges for the work of public advocates representing state consumer interests, and that the U.S. Congress has not granted FERC the authority to impose rates designed to recover costs incurred by state consumer advocate groups. They stated that the advocacy work of CAPS would not be performed with PJM assets and that, therefore, the commission did not have jurisdiction to accept the CAPS Funding Schedule.

CAPS was originally funded through a settlement with Constellation Energy Commodities Group in a 2012 proceeding before the Commission (Docket No. IN12-7-000, October 10, 2012).

According to PJM, membership in CAPS is limited to “state advocate offices designated by the laws of their respective jurisdictions to represent the interests of utility consumers within the service territory of PJM.”

PJM notes that, since the CAPS Funding Rate will be $0 for 2016 given the funds from the Constellation Settlement, the collection of funds under this rate schedule will not begin until January 1, 2017.

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