On September 6, 2019, in Docket No. 19-2769, Exelon, on behalf of PEPCO, requested recovery of 50% of prudently-incurred costs associated with the PEPCO-assigned PJM baseline reliability projects (“Potomac River Project”) that PJM subsequently cancelled, under its Regional Transmission Expansion Plan (“RTEP”) Protocols. Exelon requested recovery over five years of $616,472.36 through PEPCO’s formula rate, which is 50% of the now-abandoned capital costs of the Potomac River Project. PEPCO did not have an abandonment incentive to recover 100% of the cancelled project costs. The rate impacts are minimal. Under the PJM RTEP obligation-to-build requirements, PEPCO commenced construction of the Potomac River Project. However, PJM cancelled the Potomac River Project, which was beyond PEPCO’s control. PEPCO incurred costs consistent with the timetables required for it to satisfy its OATT obligations and directives of PJM. The allocation of the costs of the Potomac River Project is governed by PJM’s OATT as it was in effect at the time that the Potomac River Project was approved, and Exelon is only seeking approval of the recovery of the costs, not the cost allocation, which is outside the scope of this proceeding.
Dr. Paul Dumais
CEO of Dumais Consulting with expertise in FERC regulatory matters, including transmission formula rates.