Midwest ISO comes back to life
By Staff -- Purchasing, 2/12/1998
Nine Midwestern electric utilities last month filed a proposal with the Federal Energy Regulatory Commission (ferc) to create the Midwest Independent System Operator (miso, or Midwest ISO). The filing represents revival--in part--of a 26-utility plan that had collapsed in early December.Formation of ISOs is thought to be a crucial step in restructuring the North American power market and for driving the transition to customer choice. Ideally, ISOs would direct "traffic" on regional transmission grids, ensure reliability, and conduct long-term capacity planning. (Most popular analogy is to air traffic controllers). ISOs also are intended to ensure non-discriminatory access to regional transmission capacity (preventing utilities that own both generation and transmission from favoring themselves). A third function of the ideal ISO would be to set a single grid-wide transmission tariff in order to alleviate the potential stacking of transmission charges from one utility system to the next. (This latter function is especially important to end users as it opens the field of potential suppliers under competition).
Immediately following the Midwest filing, ELCON--a trade association representing 36 large industrial users of electricity--released a statement applauding the action. "ELCON has long supported the formation of large regional ISOs, and views this filing as an important first step for establishing a viable ISO." What's more, "ELCON strongly urges all transmission-owning utilities in the affected Midwestern regional reliability councils to join and support this effort."
ELCON executive director, John Anderson, said: "For a truly competitive electricity market to develop in the Midwest, it is important that all the transmission-owning utilities in the affected area participate in this ISO. Through willing participation in this ISO, they will help promote greater competition and economic growth in the Midwest."
Utilities included in the filing are: Ameren, Cinergy, Commonwealth Edison, Hoosier Energy, Illinois Power, Kentucky Utilities, Louisville Gas & Electric, Wabash Valley Power, and Wisconsin Electric.
Another 11-member group--FirstEnergy's Ohio Edison, The Illuminating Company, Pennsylvania Power Company, and Toledo Edison, plus Consumers Energy, Detroit Edison, Duquesne Light, Virginia Power and the Allegheny Power companies--Monongahela Power, Potomac Edison, and West Penn Power--recently announced its investigation of a similar plan.
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