FERC asks for $368 million in FY 2018 budget

The funding request is an increase of about $48.4 million

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FERC, in its fiscal year 2018 Congressional Performance Budget Request and FY 2016 annual performance report, requested about $368 million, and 1,465 full-time equivalents to execute its mission in FY 2018.

The funding request is an increase of about $48.4 million, or about 15.2 percent, above the FY 2017 annualized continuing resolution rate, FERC added.

The FY 2018 request supports an overall 5 percent increase in base operating costs, FERC said, adding that it allocates more than two-thirds of its budget to directly cover the compensation costs of its employees on an annual basis.

FERC noted that its request reflects the necessary resources to support increases in salaries and benefits associated with a 1.9 percent pay raise in FY 2018.

The request also provides continued funding for program contracts associated with statutorily required hydropower environmental workload, natural gas pipeline construction oversight, liquefied natural gas construction inspections, and expert witness contractor assistance in FERC’s enforcement program, FERC said.

In addition, the request provides resources to support FERC’s infrastructure review process for non-federal hydropower and natural gas pipeline facilities, FERC said, adding that the request includes an increased investment in new information technology projects that will advance priority information technology initiatives and yield increased operational efficiency.

FERC said that in addition to its base operating expenses, the budget request includes additional funding required to continue a complex multi-year renovation effort within its headquarters building.

Discussing electric transmission and open access, FERC noted that in May 2016, it convened a technical conference to discuss certain interconnection issues related to a petition for rulemaking (Docket No. AD14-8-000), as well as other interconnection issues identified by FERC staff. The technical conference focused on five interconnection topics, including the interconnection of electric storage issues, FERC said.

Upon consideration of those issues and based in part on the input provided in comments and at the technical conference, FERC proposed reforms to the interconnection processes in a notice of proposed rulemaking in December 2016, FERC said.

In that notice, FERC generally proposed reforms falling into three broad categories that are intended to improve predictability in the interconnection process; improve transparency by providing more information to interconnection customers; and enhance the interconnection process. FERC added that 64 comments were filed and that work is continuing into FY 2017 and FY 2018.

On electric transmission planning, FERC noted that it issued Order No. 1000 in July 2011, Order No. 1000-A in May 2012, and Order No. 1000-B in October 2012. Order No. 1000 requires public utility transmission providers to improve transmission planning processes and allocate costs for new transmission facilities to beneficiaries of those facilities, thereby aligning transmission planning and cost allocation, FERC said.

FERC noted that in FY 2013, it issued orders addressing all of the initial regional compliance filings and requiring further compliance filings; in FY 2014, FERC addressed the requests for rehearings of the orders addressing the initial regional compliance filings and the second round of regional compliance filings; and in FY 2015, FERC issued orders addressing the requests for rehearing of the second round of regional compliance orders, and the third round of regional compliance filings, as well as a few of the fourth round of regional compliance filings.

In addition, in FY 2015, FERC addressed the compliance filings made to address the interregional requirements to ensure that they meet the requirements of Order No. 1000, and addressed further regional compliance filings.

FERC added that in FY 2016, it issued final compliance orders for all but one of the regional compliance filings, and all but one of the interregional compliance filings.

In FY 2017, FERC issued a final compliance order on the last pending interregional compliance filing, FERC said, adding that it will address the one pending regional compliance filing in FY 2017 or FY 2018.

FERC said that it will also continue to monitor the implementation of the transmission planning reforms adopted in Order No. 1000 to evaluate their effectiveness in FYs 2017 and 2018.

FERC further noted that in June 2016, it held a technical conference to explore issues related to the competitive transmission development processes, including the use of cost containment provisions.

FERC said that its staff is reviewing the post-technical conference comments and expects to continue to explore those issues in FY 2017.

In addition, FERC noted that it approved in FY 2014 the California ISO’s (Cal-ISO) implementation of an energy imbalance market (EIM), allowing neighboring balancing area authorities in the western states to participate in the imbalance energy portion of Cal-ISO’s real-time market.

FERC said that it will continue to monitor the implementation, performance, and integration of existing and new balancing authority areas participating in the EIM, as well as any enhancements that the Cal-ISO proposes to its current EIM design and processes in FYs 2017 and 2018.

FERC also noted that its staff has been examining the use of electric storage resources to help meet wholesale electricity needs for some time. For instance, based on the responses to a data request and comments on those responses, FERC last November issued a notice of proposed rulemaking that proposes to require each RTO/ISO to revise its tariff to:

· Establish a participation model consisting of market rules that, recognizing the physical and operational characteristics of electric storage resources, accommodates their participation in the organized wholesale electric markets

· Define distributed energy resource aggregators as a type of market participant that can participate in the organized wholesale electric markets under the participation model that best accommodates the physical and operational characteristics of its distributed energy resource aggregation

Comments on the proposed rule were received in February, with related work continuing into FYs 2017 and 2018, FERC added.

FERC also noted that it issued a policy statement, “Utilization of electric storage resources for multiple services when receiving cost-based rate recovery,” in January.

Among other things, FERC said that it continues to encourage the efficient operation of the electric grid, which includes the development of a smart grid. FERC said that in FYs 2017 and 2018, it will monitor the development of interoperability standards in the National Institute of Standards and Technology framework process and evaluate standards as appropriate to determine whether there is sufficient consensus for adoption.

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