On June 25, 2010, Duke Energy Ohio, Inc. (“DEO”) and Duke Energy Kentucky, Inc. (“DEK”) filed the first of several filings with the Federal Energy Regulatory Commission (“FERC” or the “Commission”) seeking approval to transfer control of utility assets from the Midwest Independent System Operator, Inc. (“Midwest ISO”) to PJM Interconnection L.L.C. (“PJM”). 

DEO and DEK want to withdraw from Midwest ISO in order to consolidate operation of their facilities within a single wholesale market. Currently, DEO co-owns generating resources that are located within PJM and some gas-fired capacity within PJM.  Withdrawing from the Midwest ISO and joining PJM will allow Duke to consolidate all of its Ohio facilities under the control of PJM, which one wholesale customer stated will lead to greater efficiency. 

In their filing, DEO and DEK requested that the Commission issue an order by November 1, 2010 so that they may participate in PJM’s Reliability Pricing Model auctions during the Spring of 2011 as well as the Base Residual Auction in May 2011.  DEO and DEK plan to complete the transfer of operations by January 1, 2012. 

In order to approve DEO and DEK’s withdrawal from Midwest ISO, the Commission must find that: (1) the withdraw satisfies the terms of the applicant’s contractual obligations as they relate to withdrawal from Midwest ISO; (2) the replacement arrangement complies with Order No. 888 and Order No. 890; and (3) the replacement arrangement is not unjust, unreasonable or unduly discriminatory.  In their filing, DEO and DEK provide evidence that they will fulfill their contractual obligations and comply with Order No. 888 and Order No. 890. 

A copy of DEO and DEK’s filing is available here