Adrienne Thompson

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On March 21, 2017, the Wyoming Pipeline Authority (“WPA”) withdrew its request for rehearing of the delegation order that FERC issued on February 3, 2017 (“Delegation Order”) in anticipation of the Commission’s loss of quorum following the departure of former Chairman Norman Bay.  The Delegation Order allows FERC staff to…

In an order issued on March 7, 2017, the United States District Court  for the Eastern District of California (“District Court”) rejected arguments from FERC regarding the scope of review and applicable procedural rules governing the District Court’s review of a market manipulation enforcement proceeding. The District Court held that the Federal Rules of Civil Procedure (“FRCP”) applied to the action and rejected arguments that it was limited to “de novo” review of the administrative record as compiled by FERC. As a result, the District Court ordered FERC to provide discovery to the opposing parties.

On March 6, 2017 the Wyoming Pipeline Authority (“WPA”) requested rehearing of FERC’s February 3, 2017 Delegation Order (“Delegation Order”).  In the filing, the WPA asserted that the Delegation Order exceeds FERC’s statutory authority because it purports to authorize agency staff members to take action that would not be possible for FERC itself to take due to the current lack of quorum.  This deficiency, WPA argued, can only be cured through the appointment of new Commissioners.

On February 21, 2017, the North American Electric Reliability Corporation (“NERC”) submitted its annual risk-based Compliance Monitoring and Enforcement Program (“CMEP”) report to FERC. In the report, NERC reviewed the CMEP’s progress for 2016 and proposed two enhancements to improve the program’s efficiencies and effectiveness. Specifically, NERC proposed (1) discontinuing the requirement that registered entities publicly-post their noncompliance logs and (2) expanding the use of Compliance Exceptions (“CEs”) to include certain moderate-risk noncompliance issues. NERC asserted that the proposed enhancements would allow the CMEP to better target higher-risk issues that can impact the reliability of the bulk power system.

On February 3, 2017, FERC partially granted a complaint against the New York Independent System Operator, Inc. (“NYISO”) regarding the application of buyer-side market power mitigation rules to demand response resources in NYISO’s installed capacity market (“ICAP”). In its order, FERC found that NYISO’s application of its mitigation rules was unjust and unreasonable as to future demand-side generators. FERC allowed prospective exemptions for such resources, but denied exemptions for such resources currently subject to NYISO market power mitigation. Separately, outgoing Commissioner Bay wrote a lengthy concurrence in which he argued that FERC should reconsider the rationale behind its minimum offer price rule policy (“MOPR”) and its applicability in wholesale electricity markets.

On February 1, 2017 FERC issued an order approving a settlement between its Office of Enforcement (“Enforcement”) and Houston-based power marketer GDF SUEZ Energy Marketing NA, Inc. (“GSEMNA”) following an investigation into whether GSEMNA violated FERC’s anti-manipulation regulations from May 2011 to September 2013. As part of the agreement, GSEMNA neither admitted to nor denied the alleged market manipulation violations, but agreed to be subject to monitoring and annual compliance reporting as well as to pay a disgorgement of $40.8 million in unjust profits and a civil penalty of $41 million to the U.S. Treasury.

On January 24, 2017, FERC issued an order accepting simultaneous transmission import limit (“SIL”) values for the Southwest United States from a group of transmission owners operating in the region. In the Order, FERC noted its intent to use these SIL values in evaluating updated market power analyses for the Southwest region, and also provided guidance for future filers on how the Commission expects SIL studies to be performed and reported.

On January 19, 2017, FERC denied a request from Vote Solar Initiative and the Montana Environmental Information Center (collectively, “Vote Solar”) that FERC reconsider a November 1, 2016 order (“November Order”) dismissing Vote Solar’s complaint against the Montana Public Service Commission (“Montana Commission”), alleging that the Montana Commission violated section 210 of the Public Utility Regulatory Policies Act of 1978 (“PURPA”) by altering the state’s framework for solar projects seeking to be qualifying facilities (“QFs”). In requesting reconsideration, Vote Solar alleged that FERC misconstrued its complaint as being a request for enforcement pursuant to PURPA Section 210(h) and that it was instead a request for FERC to use its remedial authority under Federal Power Act (“FPA”) section 309. In denying the request, FERC explained that the broad language of its regulations does not give FERC greater enforcement authority than the operative statute itself. FERC also reiterated the jurisdiction and standing deficiencies inherent in the complaint, and noted that many of Vote Solar’s substantive concerns were addressed in a recently issued Notice of Intent Not to Act and Declaratory Order in a similar challenge brought by a QF against the Montana Commission.