On January 30, 2012, the Federal Energy Regulatory Commission’s (“FERC or Commission”) staff issued a white paper for comment regarding how the Commission should advise the Environmental Protection Agency (“EPA”) on requests for extensions to comply with the Mercury and Air Toxic Standards (“MATS”) rule.  The white paper outlines staff’s recommendations on how the Commission will view a request for extension, what the Commission will base its review on, what standard of review it should use, and in what manner it will advise the EPA.  The Commission asked that commenters also address:  (1) elements outlined in EPA’s Policy Memorandum of  administrative orders (“AOs”), (2) how and whether the Commission should review issues arising outside of a potential violation of a reliability standard, (3) the standard of review to be used in determining whether there may be a violation of a reliability standard, and (4) what the Commission’s comments to EPA should highlight.

The MATS rule mandates that power generating units comply with its standards within three years of its effective date.  However, some units are eligible for an additional year to comply with the rule, and in addition, certain units can request an additional year through an AO.  AOs are available for: (1) electric generating units that may affect reliability due to deactivation, and (2) units that may affect reliability due to delays related to the installation of controls.  EPA has stated it will seek the advice of FERC and other entities to ensure AO requests are properly assessed.
 
In the white paper, Staff recommends that all AO requests will be filed with the Commission Secretary and the request will be treated as an informational filing, receiving a separate Administrative Docket number.  The filing will include the identical information submitted to EPA in the request for an AO.  The Commission will review the filing based on the potential for violating a reliability standard. However, the white paper states that staff is unsure whether the Commission should review issues that fall outside of potential reliability violations  and/or whether a de novo standard of review  should apply to determinations made by a planning authority.

In advising EPA on the request for an AO, Commission staff proposes that it will submit written comments to EPA. 

Comments on the white paper are due on February 29, 2012.

A copy of the white paper can be found here.

A summary of the MATS rule can be found here and an informative presentation can be found here