On May 19, 2016, FERC issued Order No. 816-A, denying requests for rehearing and granting certain requests for clarification of Order No. 816. Order No. 816 amended FERC’s regulations governing market-based rate (“MBR”) authorizations for wholesale sales of energy, capacity, and ancillary services by public utilities under the Federal Power Act (“FPA”).

FERC received nine requests for rehearing and clarification of its Order No. 816 on issues related to: (1) sellers with fully committed long-term capacity; (2) the reporting of long-term firm purchases; (3) the definition or duration of long-term firm transmission reservations; (4) notices of change in status; (5) new affiliations and behind-the-meter generation; (6) corporate organizational charts; and (7) waiver of FERC’s Uniform System of Accounts regulations.

FERC denied the requests for rehearing, but it provided certain clarifications. In particular, FERC clarified that for MBR sellers in a regional transmission organization (“RTO”) or independent system operator (“ISO”) market, those MBR sellers must report all long-term firm energy and capacity purchases from generation located within the RTO/ISO market if such generation is designated as having capacity obligations. In doing so, FERC explained that this requirement does not apply if the generation is a qualifying facility exempt from section 205 of the FPA. Similarly, FERC clarified that a seller must list all long-term firm power purchases in its asset appendix, even if it does not have MBR authority within its own balancing authority area.

FERC also clarified that it did not intend to change the definition of long-term firm transmission in Order No. 816. FERC reaffirmed its prior determination that short-term reservations are up to one month, and long-term reservations are greater than one month. FERC explained that because February is the shortest month, long-term firm transmission reservations are longer than 28 days. FERC also affirmed its determination in Order No. 816 to use a 100 MW threshold for reporting new affiliations in a change of status filing, but clarified the relevant geographic markets for purposes of calculating whether the 100 MW threshold has been met. In doing so, FERC also denied a request for rehearing that sought a determination that capacity in first-tier markets—which it clarified includes first tier areas, meaning both balancing authority areas and RTO/ISO markets—should be included for purposes of determining whether the 100 MW threshold for a change in status filing has been met.

FERC also affirmed its Order No. 816 determination that behind-the-meter generation need not be included in the determination of whether the 100 MW threshold for a change in status filing has been met, or in the determination of whether a MBR seller exceeds the 500 MW Category 1 seller threshold. FERC affirmed that this type of generation need not be included in asset appendices or indicative screens.

Order No. 816-A also grants an additional extension of time to allow MBR applicants and sellers to comply with the Order No. 816 requirement to prepare corporate organizational charts. The extension will be in place until FERC issues another order on the merits of this issue “at a later date.”  FERC explained that the extension will allow it more time to fully consider the benefits and burdens associated with the corporate organizational chart requirement.

A copy of Order No. 816-A can be found here.