Entergy files for Transco and RTO
The Entergy transmission system is comprised of more than 15,000 miles of transmission lines extending from the southeastern portion of Missouri to southern Louisiana and includes the western portion of Mississippi and southeastern portion of Texas. In 1998 Entergy was among the first companies to declare its intent to create an independent, incentive-driven transmission company to own and operate its transmission system.
"The Transco model is the best vehicle to facilitate the grid expansion that is necessary to create a robust wholesale power market for both the generators and the wholesale and retail customers," said Frank Gallaher, Entergy's president of fossil operations and transmission. "The Transco will be a regulated, for-profit entity that will be responsive to incentives for superior grid performance and high-quality service and can be held accountable for its commercial actions."
The proposal would allow Entergy to comply with FERC Order No. 2000, which requires certain public utilities that own, operate or control interstate electric transmission to file a proposal for an RTO, or a description of any efforts made by the utility to participate in an RTO, by October 16, 2000. FERC Order No. 2000 requires these RTOs to commence operation by December 15, 2001.
The SPP Partnership arrangement allows the SPP and the Transco to join together to satisfy FERC's requirements for an RTO. Under the proposed partnership, the Transco will operate under the oversight of, and within, the SPP's RTO. SPP is currently a regional reliability council that provides regional security coordination and tariff administration, serving members and customers across all or parts of eight southwestern states. SPP is also filing an application with FERC seeking recognition as an RTO.
Entergy's filing describes the transmission assets to be transferred, the mechanics of the movement of transmission assets, the accounting treatment for the transfer, the features of the SPP partnership arrangement, and the Transco's corporate and governance structure.
Under the proposal, the Entergy operating companies will transfer their transmission assets to the Transco in exchange for passive ownership interest. Entergy is optimistic that other transmission owners will either transfer their transmission assets to the Transco or grant Transco responsibility for operating such assets.
Edited by Stephen Heiser