Comments of American Superconductor Corporation under PL03-1.

March 6, 2003 Via Electronic Filing Ms. Magalie Roman Salas, Secretary Federal Energy Regulatory Commission Office of the Secretary 888 First Street, N.E. Washington, D.C. 20426 Re: Comments of American Superconductor in Docket No. PL03-1-000. Dear Ms. Salas: Attached are the Comments of American Superconductor on Proposed Policy Statement for filing in Docket No. PL03-1-000. Please contact me if you have any questions in regard to this filing. Sincerely, James W. Brew Brickfield, Burchette, Ritts & Stone, P.C. 1025 Thomas Jefferson Street, N.W. Eighth Floor, West Tower Washington, D.C. 20007 Enclosure cc: Service List -#- UNITED STATES OF AMERICAFEDERAL ENERGY REGULATORY COMMISSION Proposed Pricing Policy for Efficient Operation and Expansion ) of Transmission Grid ) Docket ) No. PL03-1- 000 COMMENTS OF AMERICAN SUPERCONDUCTORON PROPOSED POLICY STATEMENT James W. BrewBrickfield, Burchette, Ritts & Stone, P.C.1025 Thomas Jefferson Street, N.W.Eighth Floor, West TowerWashington, D.C. 20007Attorneys for American Superconductor March 6, 2003 UNITED STATES OF AMERICAFEDERAL ENERGY REGULATORY COMMISSION Proposed Pricing Policy for Efficient Operation and Expansion ) of Transmission Grid ) Docket ) No. PL03-1- 000 COMMENTS OF AMERICAN SUPERCONDUCTORON PROPOSED POLICY STATEMENT EXECUTIVE SUMMARY The Commissions proposed policy statement represents a watershed development in the evolution of its transmission policies. After ten years of focusing on institutional and governance issues to support nondiscriminatory policies, this policy statement shifts the focus toward encouraging actual investment in the nations overtaxed and inadequate transmission infrastructure. The clear consensus of power industry stakeholders is that making overdue investment in the power grid policy already have been criticized by some opponents as a blunt and inappropriate instrument. Some consider the incentives to be an unwarranted inducement that could lead to overinvestment in transmission or enrich transmission owners while providing no appreciable consumer benefit. However, the Commission has overwhelming evidence of a 15-year investment deficit in the transmission sector on the order of $50 billion according to industry figures. The Commission should, therefore, not be deterred by such generic arguments, and should implement the proposed enhanced grid performance incentives. In any case, the Commission could modify the policy at any time if excessive or unnecessary grid investment became apparent. AMSC could even agree with critics of the Policy Statement that, in theory and in an ideal world, return on equity adders for grid investment should not be necessary. The pressing reality, however, is that the industry and electric consumers are enmeshed in a muddled and protracted transition. ...