FERC Approves Charge On PJM Retail Suppliers, Other LSEs To Pay For Consumer Advocates; Clark Blasts "Conscription" of Consumers To Fund Mechanism

FERC approved tariff changes filed by PJM to provide a mechanism for funding the organization Consumer Advocates of the PJM States, Inc. (CAPS).

The CAPS funding rate will be applied to every megawatt-hour of energy delivered to load.

The initial CAPS charge is $0, as CAPS is still being funded from proceeds from a prior settlement with Constellation, but a non-zero CAPS charge is expected to be implemented on January 1, 2017.

FERC dismissed protests from certain competitive suppliers, such as concerns over the lack of cost controls

Additionally, FERC said that charging LSEs to fund consumer advocates does not violate the Fist Amendment, because CAPS, "is a legitimate business expense of PJM which is not equivalent to the government compulsion of speech."

Commissioner Tony Clark dissented, stating, "This Commission has not before endorsed the policy that the activities of non-decisional intervenor groups be funded through a dedicated utility tariff under the auspices of the FPA. Yet here we are doing exactly that. Today’s order is couched in the language of good intentions, but I find it troubling precedent as both a matter of policy and prudence."

Noting the expiration of the Constellation settlement funds for CAPS, Clark continued, "The fact that the well is now dry should impose no obligation on this Commission to conscript electricity consumers in a plan to create a permanent revenue stream to replenish those funds allocated from the disgorgement of monies OE alleged were improperly earned through market manipulation of the wholesale markets. No other region of the country has a similarly situated regional committee of consumer advocates so funded, but today’s order makes it exceedingly likely such publicly funded groups will now proliferate."

Docket No. ER16-561