On March 28, 2017, Dynegy Marketing and Trade, LLC and Illinois Power Marketing Company (collectively, the “Complainants”) filed a complaint against the Midcontinent Independent System Operator, Inc. (“MISO”) alleging that MISO has failed to comply with the terms of its Open Access Transmission, Energy and Operating Reserve Markets Tariff (“MISO Tariff”) with respect to resources “pseudo-tied” into PJM Interconnection, L.L.C. (“PJM”). According to the Complainants, MISO has been assessing congestion and losses charges to MISO resources pseudo-tied into PJM using “Financial Schedules” in a manner that “blatantly contravenes the MISO Tariff and that results in the unjust, unreasonable, and unduly discriminatory imposition of duplicative charges.” The Complainants request that the Commission order MISO to immediately cease and desist from imposing such charges and that MISO “refund duplicative congestion and losses charges unlawfully imposed.”

A “pseudo-tied” resource is a generation resource that is physically located in one balancing authority area (e.g. MISO), but is electrically modeled into another (e.g. PJM). As the use of pseudo-tied resources has grown, MISO and PJM have been working through various collaborative processes to resolve the issue of “double counting,” whereby MISO resources that are pseudo-tied into PJM are charged congestion fees by both MISO and PJM, by virtue of the differing calculation methodologies used by the two Regional Transmission Organizations.

In their March 28, 2017 complaint, the Complainants claimed that from June 1, 2016 through February 28, 2017, MISO had assessed net charges of approximately $8.3 million for MISO-based resources owned by the Complainants that were pseudo-tied into PJM. The Complainants alleged that MISO had done this through the use of “Financial Schedules,” which under the MISO Tariff are “financial arrangements between two Market Participants designating a Source Point, Sink Point and Delivery Point establishing the obligations of the buyer and seller for the payment of Cost of Congestion and Cost of Losses.” (emphasis added).

According to the Complainants, MISO’s use of Financial Schedules to assess such charges violated the plain text of the MISO Tariff, because MISO had created Financial Schedules for pseudo-tied resources that only involved one market participant, whereby the owner of the pseudo-tied resource is identified as both the buyer and seller. The Complainants also stated that at least a portion of these costs assessed by MISO were duplicative of charges imposed by PJM, and were therefore unjust, unreasonable, and unduly discriminatory.

The Complainants also acknowledged other pending complaints before the Commission relating to the imposition of duplicative congestion charges on pseudo-tied resources. In doing so, the Complainants clarified that they were not asking the Commission to resolve the issue of double counting more generally, but rather were requesting that the Commission specifically find that MISO violated the MISO Tariff by using Financial Schedules to assess charges to pseudo-tied resources, and require it to refund all duplicative congestion and losses charges assessed using Financial Schedules.

A copy of the complaint is available here.