On January 21, 2022, FERC accepted revisions to the Southeast Energy Exchange Market (“SEEM”) Agreement consistent with commitments made by SEEM members in response to two deficiency letters it issued before the SEEM Agreement went into effect by operation of law.
The initial SEEM Agreement filing set forth the framework for a new voluntary electronic trading platform designed to facilitate bilateral trading in the Southeast and market access to currently unused transmission capacity. On October 21, 2021 the SEEM Agreement became effective by operation of law due to FERC inaction (See October 21, 2021 edition of the WER). Each SEEM member that was also a transmission provider subsequently filed tariff revisions to offer zero-charge transmission service to accommodate SEEM transactions, which FERC accepted in an order issued on November 8, 2021. The proposed revisions, which effectuate commitments made before the SEEM Agreement went into effect, focus primarily on providing increased transparency into transactional data, but also clarified the standard of review applicable for various provisions of the Agreement. Comments filed on the revisions questioned whether the revisions adequately addressed stakeholder concerns about market power, governance, non-discriminatory access, lack of an independent market monitor, and impacts on consumers.
In its order, FERC noted that the concerns raised in the comments pertained almost entirely to the filed rate already in effect and not to the proposed revisions. FERC went on to explain that, although it did not issue an order accepting the SEEM Agreement, it was the rate on file and the justness and reasonableness of the existing provisions of the SEEM Agreement to which the members did not propose revisions were therefore beyond the scope of the proceeding. FERC determined the proposed revisions were just and reasonable and accepted them for filing.
Chairman Glick wrote separately to reiterate his view that applying the Mobile Sierra public interest presumption (which presents a higher bar to clear to abrogate a contract under FERC precedent) to any provision of the SEEM Agreement was contrary to FERC precedent. Commissioner Clements also wrote separately to explain her view that the amendments did not cure underlying fundamental flaws with the SEEM Agreement and to make clear that her concurrence does not indicate her approval of the broader market construct, which Commissioner Clements contends violates Order No. 888’s core requirements by imposing unduly discriminatory barriers to accessing a new transmission product offered by the SEEM members.
A copy of the order is available here.