Kentucky Public Service Commission Urged to Reject RTO Membership

Kentucky Public Service Commission Urged to Reject Membership in Regional Transmission Organization

LOUISVILLE, Ky. – AARP Kentucky submitted written comments to the Kentucky Public Service Commission in the LG&E/Kentucky Utilities’ Integrated Resource Plan (KY PSC DOCKET 2021-00393) on behalf of its 430,000 members statewide. The focus of AARP Kentucky’s comments urges the PSC to reject forcing LG&E/Kentucky Utilities to join a Regional Transmission Organization (RTO).

Affordable utility rates are an essential pocketbook issue for Kentuckians age 50-plus and their families, many of whom struggle to balance paying utility bills and other household expenses along with buying food and medicine.

The Commonwealth is no stranger to Regional Transmission Organization (RTO) issues. In 2002, the KY PSC urged LG&E/KU to exit MISO (Midcontinent Independent System Operator) because of the lack of benefits to Kentucky consumers. The move proved beneficial as it allowed Kentucky ratepayers being forced to pay for expensive upgrades to other state’s transmission systems (such as in Minnesota) to meet different energy policy objectives than those of the Commonwealth. This has kept Kentucky’s electricity rates more affordable. Joining an RTO right now if fraught with reliability risks.

Yesterday ERCOT, the grid operator in Texas, again warned off rolling black outs due to a power shortage. Closer to home, grid operator MISO is warning of rolling blackouts due to a shortage of power.

By remaining independent of MISO, Kentuckians do not have to worry about such concerns. As LG&E/KU noted in its comments, it rarely needs to buy off the MISO market since costs there are higher than with LG&E/KU generation. In short, there is no need to re-visit forcing LG&E/KU back into MISO.

Kentucky Power did join PJM as did the East Kentucky Power Cooperative. Unlike MISO, PJM has a 33% reserve margin this summer. However, many of the states in PJM are deregulated (a model which Kentucky has wisely chosen to avoid).

AARP POSITION

AARP’s Policy on the RTO issue could not be clearer: “States should oppose efforts to bring deregulation to their state. This also includes opposing joining regional transmission organizations (RTOs).”

AARP Kentucky’s comments to Kentucky Public Service Commission are available,here (PDF)

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