New England Demand Response Initiative
Regional State Advisory Committee (RSAC) or
Regional System Advisory and Coordination Committee (RSACC) 1
December 4, 2002
Jeff Schlegel and Richard Sedano, NEDRI Consultants
With significant input from the NEDRI Energy Efficiency Working Group
(Special thanks to the RSAC subcommittee: Alex Lee, Sue Coakley, and Don Gilligan)
Introduction:
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Below is a draft strategy or concept paper on a Regional State Advisory Committee (RSAC
or RSACC) for NEDRI’s review and consideration. While this draft has been prepared with
significant input and contributions from the Energy Efficiency Working Group, it addresses
many RSAC-related issues and is not limited to energy efficiency issues.
We tried to build off of the FERC SMD text about the RSAC and the National Governors
Association (NGA) text about the multi-state entity whenever and wherever we could, as
long as we thought it made sense. We will distribute (separately) a compilation of excerpts
about the RSAC from the FERC SMD NOPR, a NARUC summary of the FERC SMD, and
the National Governors Association summary text on the multi-state entity, which may be
helpful to you.
We suggest that NEDRI review and discuss this draft at the December 10 meeting, and
continue discussion at the January 14 meeting, with potential NEDRI action at the January or
February meeting.
Mission
The purpose of the Regional State Advisory Committee (RSAC), a multi-state entity, is to
coordinate oversight of state and federal policies concerning wholesale and retail markets and to
serve as a regional information resource to guide the development and operation of a safe,
reliable, adequate, and equitable electric energy system to serve the public interests of the New
England region consistent with economic and environmental policy goals.
Scope
Recognizing the sovereignty of each New England State to establish its own policies regarding
state electric system needs, facility siting, local environmental standards, and cost recovery;
federal jurisdiction regarding interstate transmission tariffs, regional transmission issues, and
national environmental standards; and the overlapping nature of many of these issues among
states and with federal agencies, the RSAC will serve in an advisory and informational capacity
We suggest a name similar to but distinct from RSAC to explicitly state the “system” scope and include the
“coordination” role (in addition to the advisory role).
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to guide state and federal policies regarding electric system planning, development, operation,
and rates, and to coordinate oversight and advise integration of such policies. This coordinated
oversight will ensure fulfillment of federal public interest responsibilities in a manner that
includes the views of states throughout the region. The RSAC will bring a valuable regional
perspective to electricity system issues and will play a role in deciding these issues in partnership
with FERC.2
The RSAC will review, research, plan, advise, coordinate, and recommend demand and supply
side options, system and transmission expansion proposals, and distributed energy resources.
1. Range of Issues: To address overlapping policies and needs of FERC, the wholesale
power market, ISO-New England, state utility and environmental regulatory
commissions, New England governors, distribution utilities, and retail markets for
electric services, the RSAC will identify and characterize regional electric system
issues that require solutions, and will identify and seek solutions to the identified
regional electric system issues that may fall under federal, state, or shared
jurisdiction, including but not limited to:3
a. Resource adequacy standards and policies;
b. System Transmission planning and expansion;
c. Rate design and revenue requirements;
d. Market power and market monitoring;
e. Demand response and load management;
f. Distributed energy resources generation and interconnection policies;
g. Energy efficiency and environmental issues planning, policies and programs;
h. Environmental issues and requirements;4
i. RTO management and budget review; and
j. Gas and fuel system planning as it relates to electricity.
Further duties may evolve with the development and operation of the regional
committee.
2. Responsibilities: Serving as a regional electric system planner, information
clearinghouse, and policy forum, and in coordination with ISO-New England on
transmission planning issues, the RSAC will:
a. Recommend resource adequacy standards and policies to guide regional
electric system planning, development and operation.
b. Work with ISO-New England to identify ten-year transmission system needs
and transmission system expansion options. (ISO-NE will continue to have
primary responsibility for transmission planning within overall system
planning.)
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The last two sentences were adopted from the FERC SMD text.
The “Range of Issues” list is taken directly from the FERC SMD NOPR, paragraph 554, with our recommended
revisions shown explicitly in redline and strikethrough.
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We listed energy efficiency and environmental issues in two separate bullets rather than in one combined bullet.
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c. Work with state and regional environmental agencies (e.g., NESCAUM) to
identify air and water quality issues, policies, and constraints that affect the
future development and operation of regional electric system.
d. Work with ISO-New England and the distribution companies to develop each
year a coordinated ten-year regional forecast of electric system needs to assure
all resources are available to address system needs, and recommend the best
resource options and plans to serve the region as a whole.
e. Recommend to federal agencies, ISO-New England and New England States
coordinated actions and policies to implement the plan.
f. Assist FERC and state public utility commissions to identify revenue
requirements for regional transmission and reliability resources, and
recommend cost allocation and rate designs to recover those costs in a fair and
equitable manner that considers cost causation (i.e., beneficiaries of system
improvements) and encourages market-based responses to defer more costly
regional transmission system expansions.
g. Assess the potential contribution of cost-effective demand side resources (i.e.,
energy efficiency, demand reduction, load management, distributed energy
resources) and recommend and coordinate policies and programs to optimize
the contribution of such resources to meet short-term and long-term needs.
h. Recommend system and transmission system expansion proposals.
i. Review gas and fuel system issues related to electricity, and recommend
actions and policies as appropriate.
j. Facilitate regional review of market monitoring and recommend state and
federal policies and actions as appropriate to maintain a fully competitive
market for generation, reliability and transmission resources to serve New
England.5
Composition and Governance
The RSAC will be comprised of two representatives from each state appointed by the governor
of each state.6 The RSAC representatives should have relevant experience and expertise in
electric system planning and/or environmental regulation. For example, the governors could be
guided, but not directed, by guidelines articulating a preference for experience in utility
regulation, environmental regulation, and/or siting. The RSAC representatives should be
expected to gather and address input from all interests within their state.
The by-laws of the organization could allow for FERC and the ITP/RTO to appoint liaisons.
These would have standing as non-voting member-observers. Other organizations, such as
NESCAUM, US EPA, US DOE (for energy emergency issues), and NECPUC, could also be
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The market monitoring element is a major dividend of a regional committee. It is not realistic to expect FERC to
bear the full burden of market monitoring, and having capacity at hand with local familiarity to complement FERC
is essential to successful management of this task.
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It would be desirable to require the state delegation to be unanimous. Effectively, states would have one vote each,
and the two representatives would have to vote unanimously (thereby ensuring any in-state issues and conflicts
would be resolved in that state prior to any action by RSAC).
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non-voting member-observers depending on the existence of a functional relationship that would
be enhanced through non-voting direct participation in RSAC.
Given the responsibilities described above, the RSAC will be served by a professional staff to
conduct or coordinate review, research, planning, and other activities to serve RSAC functions as
directed by the RSAC. The RSAC will hire an Executive Director to manage the work of the
RSAC as directed by the Committee. Staffing may be supplemented as needed from the member
states, by mutual agreement.
Funding
The RSAC operations would be funded by a rolled-in regional tariff, supplemented by federal
dollars as available (e.g., potentially similar to NWPPC, TVA, BPA, WAPA).
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