This Proposed Solution is a resubmittal of the modified Independence Energy Connection (IEC) Project. The Proposed Solution consists of: (1) the IEC West Portion, which is comprised of approximately 29 miles of new double-circuit 230 kV AC overhead transmission line between the existing Potomac Edison Ringgold Substation in Washington County, Maryland to a new Rice Substation in Franklin County, Pennsylvania; and (2) the reconfigured IEC East Portion, which is primarily comprised of adding 230 kV AC overhead transmission lines between a new Furnace Run Substation in York County, Pennsylvania, and the existing BGE Conastone (via Baltimore County) and Graceton Substations in Harford County, Maryland.

Violations are small in magnitude and operating steps for a short term duration can mitigate issues pending further review in 2022 RTEP.

On the supply side in PJM, "we're seeing dramatic retirements" of coal-fired generation, with PJM retiring about 15 GW of coal in the next two years that it is not being replaced on a one-to-one basis, Thomas said.
The Midcontinent System Operator is experiencing a similar trend, with incremental generation resources being added that do not have the same reliability attributes as those being retired. "They are adding megawatts that are less valuable than the megawatts being retired, meaning they need to add significant multiples to replace what's being retired," he said.
In MISO, the accredited capacity being added goes down out to 2041, while the future load scenarios continue to go up.

"This is kind of a fascinating trend, and arguably not a sustainable trend, because what all these other regions are counting on is importing power from other areas of the country to make up the difference and that's a house of cards waiting to fall," Thomas said.
PJM is not one of the areas identified by the North American Electricity Reliability Corporation, an international regulatory authority, as having reliability concerns, but "they're coming in a big way," he said.
The PJM interconnection queue of resources planning to connect to the grid is 95%, if not more, wind and solar power resources, which is where the economic signals are right now.
"There is going to be very little to no new natural gas coming into the system and coal is going to continue to retire" with the nuclear power resources remaining because they are subsidized at the state and federal level, Thomas said.

One of the core tenets of the PJM capacity market is that in order to have capacity it must be deliverable. A megawatt of power on the system only has value if it can be delivered at peak demand periods, Thomas said.
PJM has been giving capacity accreditation to intermittent resources above their approved capacity injection rights levels, so these resources were selling capacity that was not deliverable, and that is a problem, he said.

The problematic aspect is consumers have been paying for capacity that has no value at peak, and suppliers "are getting boxed out of the market by these undeliverable megawatts," Thomas said.

Because we conclude that the Commission’s decision denying the Siting Applications and rescinding Transource’s provisional CPC was in accordance with Pennsylvania law, including Sections 1501 and 2805(a) of the Code, and Section 57.76(a) of the Regulations, and is supported by substantial, credited evidence
of record, we affirm.

As for Transource’s arguments that PJM’s determination of need would be binding due to this matter involving issues of interstate regional transmission subject to FERC oversight,the ALJ held that the Commission was obligated to make an independent determination based on Pennsylvania law. (Id.at 82, 86, 99-102.)The ALJ further observed that while FERC has exclusive jurisdiction over the interstate transmission of electric energy and wholesale electric process, that jurisdiction was limited to matters that are not subject to state regulation. (Id.at 85 (citing Section 824(a) of the Federal Power Act, 16 U.S.C. § 824(a)).) According to the ALJ, FERC recognized this limitation by stating that there is “longstanding state authority over certain matters that are relevant to transmission planning and expansion, such as matters relevant to siting, permitting, and construction” and that the FERC was in noway invoking “an exercise of authority over those specific substantive matters traditionally reserved to the states . . . .”(Id.(quoting Transmission Planning and Cost Allocation by Transmission Owning & Operating Pub.Utils., 76 Fed. Reg. ¶¶49,842, 49,861 (Aug. 11, 2011) (FERC Order No. 1000)).) This means, according to the ALJ, that FERC Order No. 1000 was “not intended to dictate substantive outcomes” or to allow FERC to “determine what needs to be built, where it needs to be built, and who needs to build it.” (Id.at 85 n.13 (quoting S.C. Pub. Serv. Auth. v. Fed. Energy Reg. Comm’n, 762 F.3d 41, 57-58 (D.C. Cir. 2014) (internal quotation marks and citation omitted)).)

As for the resolution of congestion in the APSRI, it does not appear that we have ever held that congestion, which is an economic consideration, is sufficient on its own to support need or necessity under Pennsylvania law.

It was not just OCA’s witness who criticized PJM’s cost-benefit analysis, but PJM’s own Independent Market Monitor who suggested that its market efficiency process, which includes the cost-benefit analysis, be reevaluated and that the actual costs and benefits of a project should be considered and not ignored in determining whether a market efficiency project is needed.

Although the Federal Power Act assigns
authority over regional transmission projects and interstate transmission needs to
FERC, it preserves state authority over siting and construction issues related to those
projects. See New York, 535 U.S. at 18-22 (explaining that 16 U.S.C. § 824 contains a
“‘clear and specific grant of jurisdiction’ to FERC” over interstate transmission service
and rates but “reserve[s] state powers” over other matters); S.C. Pub. Serv. Auth., 762
F.3d at 62

Transource brought its exceptions to the Recommended Decision before the full PAPUC, explaining in detail how the Recommended Decision misinterpreted FERC’s Order No. 1000, the meaning and weight of the PJM regional transmission planning process and decision on Project 9A, and the remaining role left for the PAPUC under state law in this context.

Pennsylvania made the choice to allow its utilities to join PJM, and it has reaped the benefits of being part of an integrated regional market. A consequence, however, is that the state has chosen to subordinate its police power interests in determining the need for new transmission projects to PJM’s determination of regional needs.

Under Pennsylvania law, the PAPUC’s order had immediate effect and is in force today, see 66 Pa. Cons. Stat. § 316, meaning that Transource is no longer a Pennsylvania-authorized public utility. Thus, Transource is no longer authorized to access lands for project assessment or to conduct appraisals.

Transource PA faces the prospect of imminent and irreparable harm as a result of the PAPUC’s order. Under its Designated Entity Agreement, Transource PA is required to acquire all state permits by September 30, 2021. A failure to meet that milestone date constitutes a breach of the agreement, which could result in the elimination of Project 9A from the Regional Transmission Expansion Plan and the termination of the agreement.

Transource PA requests such other and further relief as the Court may deem just and proper, including attorneys’ fees pursuant to 42 U.S.C.
§ 1988.

We expressly reject any argument that the authority granted by the Pennsylvania Legislature to this Commission under the Code, including the power to apply Commission Regulations in the present circumstances, is preempted by the federal power pursuant to which PJM conducts its selection process for regional transmission planning purposes, including Project 9A.  To the extent Transource argues that this Commission is prohibited from rendering an independent determination of “need” for Project 9A, which may find that the weight of the evidence does not support a determination of “need” for the proposed project, pursuant to 52 Pa. Code § 57.76(a)(1), despite PJM’s selection of the project for regional planning purposes, we disagree. 

Contrary to Transource’s asserted position, the federal authority under which PJM operates does not extend beyond PJM’s approval process, where approval is sought from a state commission.  PJM approval for a project, including Project 9A, does not guarantee approval for siting and construction of transmission lines within the borders of the sovereign Commonwealth of Pennsylvania

FERC likewise recognizes this limitation stating the following as part of Order No. 1000:
 
We acknowledge that there is longstanding state authority over certain matters that are relevant to transmission planning and expansion, such as matters relevant to siting, permitting, and construction.  However, nothing in this Final Rule involves an exercise of siting, permitting, and construction authority. The transmission planning and cost allocation requirements of this Final Rule, like those of Order No. 890, are associated with the processes used to identify and evaluate transmission system needs and potential solutions to those needs. In establishing these reforms, the Commission is simply requiring that certain processes be instituted.  This in no way involves an exercise of authority over those specific substantive matters traditionally reserved to the states, including integrated resource planning, or authority over such transmission facilities. For this reason, we see no reason why this Final Rule should create conflicts between state and federal requirements.
 
The D.C. Court of appeals summarized Order No. 1000, as follows:
 
In Order No. 1000, the Commission expressly “decline[d] to impose obligations to build or mandatory processes to obtain commitments to construct transmission facilities in the regional transmission plan.” More generally, the Commission disavowed that it was purporting to “determine what needs to be built, where it needs to be built, and who needs to build it.”  As the Commission explained on rehearing, “Order No. 1000’s transmission planning reforms are concerned with process” and “are not intended to dictate substantive outcomes.” The substance of a regional transmission plan and any subsequent formation of agreements to construct or operate regional transmission facilities remain within the discretion of the decision-makers in each planning region.

Officials at PJM said they were also reviewing the PUC’s decision and that it “appreciates the commission’s consideration.”

“PJM will commence the appropriate planning studies to determine next steps, including identifying any potential reliability issues due to removal of the project from the Regional Transmission Expansion Plan,” the RTO said in a statement.

The OCA also noted that Transource’s assertions regarding “reliability” as a basis for need refer to a single generation deliverability test performed by PJM in 2018.  Further, the OCA noted PJM neither, performed its full suite of reliability tests to confirm that these reliability violations will result in 2023, nor, performed another generation deliverability test since 2018 which may confirm or refute the results of the 2018 test.  

In its Exception No. 8, Transource asserts that the ALJ’s recommendation to deny Project 9A is based on “faulty findings” without specifying any alleged factual or legal error.  In footnote to its Exception, Transource takes issue with certain specified findings by the ALJ and asserts, as a general matter, that all the ALJ’s findings of fact and conclusions of law should be disregarded to the extent the findings “are inconsistent with [Transource’s] Exceptions, Briefs and Testimony in this proceeding.”  Transource Exc. at 39, fn. 27 (emphasis added). 
 
We note that Transource’s Exception, as stated, fails to conform with Commission Regulations for stating exceptions, and lacks sufficient specificity to enable our review.  See 52 Pa. Code § 5.533 (pertaining to exceptions, requiring that the exceptions be stated with supporting reasons for each exception).  A general assertion that all the ALJ’s factual findings and legal conclusions should be disregarded to the extent they are “inconsistent” with a party’s filings does not state a supporting reason to disregard any of the findings and conclusions.  

... “need” from a PJM planning perspective may or may not be, as Transource asserts, “consistent with the standard for need under Pennsylvania law.”  It is for this Commission, not PJM, to decide whether the PJM planning perspective is, or is not, in line with the Pennsylvania standard for “need” under the Code, Commission Regulations and relevant caselaw.

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