On August 27, 2012, FERC Commissioners Tony Clark and Phillip Moeller issued separate concurring opinions in an order regarding the results of ISO-New England, Inc.’s (“ISO-NE”) sixth Forward Capacity Auction.  In those concurrences, the two Commissioners urged Congress to take action to rectify conflicts between environmental regulations and reliability standards. 

The current issue arose when GenOn Kendall (“GenOn”) filed a pleading with FERC arguing that its Kendall plant in Massachusetts may be forced to choose between violating the Clean Water Act (“CWA”) or ISO-NE’s tariff provisions on reliability (see June 25, 2012 edition of the WER).  GenOn had filed comments on ISO-NE’s Forward Capacity Auction results, which highlighted what it argues is an ongoing tension between environmental compliance and reliability rules.  GenOn stated it must choose between reconfiguring its Kendall plant to comply with the CWA and violating the capacity provisions of the ISO-NE tariff.

In his concurrence, Commissioner Clark stated that FERC lacks the sole authority to resolve all potential conflicts, but noted that environmental regulations currently pose a challenge to reliability modeling.  Commissioner Moeller, in his concurrence, highlighted that while GenOn may have other options available to avoid the choice of violating environmental regulations or reliability provisions, others, in the future, may not.  Commissioner Moeller further noted that with conflicting federal laws and regulations, the power grid is jeopardized and the chance of a blackout increases.  Both Commissioners state that Congressional action is needed to resolve these conflicts, and believe that reliability is the responsible approach.

A copy of the Order with concurrences can be found here.