On January 20, 2025, Donald Trump was sworn in as the 47th President of the United States. On his first day in office, President Trump signed various executive orders effectuating administrative and policy changes across the federal government, including naming a new FERC Chairman and declaring a national energy emergency.
D.C. Circuit Upholds FERC Order Requiring Stingray to Restore Service Before Abandoning Damaged Pipeline
On December 20, 2024, the United States Court of Appeals for the District of Columbia Circuit (“D.C. Circuit”) upheld FERC’s order authorizing Stingray Pipeline Company, L.L.C. (“Stingray”) to abandon a portion of its pipeline system on the condition that before doing so, Stingray either restore service or obtain a shipper agreement that the damaged pipeline segment remain out of service.
D.C. Circuit Vacates FERC’s Approval of Transco’s Pipeline Expansion
On July 30, 2024, the United States Court of Appeals for the District of Columbia Circuit (“D.C. Circuit”) issued an opinion vacating and remanding FERC’s order approving Transcontinental Gas Pipe Line Company’s (“Transco”) Regional Energy Access Expansion Project (“Project”) determining that FERC failed to consider environmental consequences and evidence suggesting
FERC Approves MISO’s Use of Downward Sloping Demand Curve in 2025-2026 Planning Resource Auctions
On June 27, 2024, FERC accepted Midcontinent Independent System Operator Inc.’s (“MISO”) proposed tariff revisions that sought to implement a downward-sloping Reliability Based Demand Curve (“RBDC”) in the MISO Planning Resource Auction (“Auction”) beginning with the 2025/2026 Planning Year. FERC determined that MISO’s proposal is not only consistent with its acceptance of similar sloped curves in other Regional Transmission Owners/Independent System Operators capacity markets but that MISO’s proposal to adopt a downward-sloping RBDC will reduce volatility in Auction Clearing Prices, increase the stability of the capacity revenue stream over time, and render capacity investments less risky, thereby encouraging greater investment and at a lower financing cost.
Divided FERC Announces Much-Anticipated Transmission Rules
On May 13, 2024, the Commission announced two major transmission reform final rules: Building for the Future Through Electric Regional Transmission Planning and Cost Allocation (“Order No. 1920”) and Applications for Permits to Site Interstate Electric Transmission Facilities (“Order No. 1977”). Order No. 1920, which adopts specific requirements for how transmission providers must conduct long-term planning and allocate costs for regional transmission facilities, was the subject of significant debate at today’s meeting and only mustered two votes in support from the three sitting commissioners. The Commission unanimously approved Order No. 1977, which updates the process FERC will use in the limited circumstances in which it must exercise its authority over siting electric transmission lines, as directed by Congress in the Infrastructure Investment and Jobs Act of 2021 (“IIJA”).
Senate Introduces Bipartisan Legislation to Give FERC Retroactive Refund Authority Under Section 5 of the Natural Gas Act
On April 18, 2024, Senators Richard Blumenthal (D-CT) and Cindy Hyde-Smith (R-MS) introduced the Making Pipelines Accountable to Consumers and Taxpayers Act (“MPACT Act”) (S. 4171) that, if adopted, would grant FERC authority to order refunds under section 5 of the Natural Gas Act (“NGA”). Specifically, the MPACT Act amends section 5 of the NGA to give FERC authority to order a pipeline to issue retroactive refunds for charges FERC determines are unjust and unreasonable. The MPACT is intended to align FERC’s authority over the gas and electric industries and protect customers from unjust and unreasonable rates. At this time, a companion bill has not been introduced in the House of Representatives.
D.C. Circuit Upholds FERC Orders Granting Natural Gas Pipeline Companies’ Requests to Extend Project Deadlines
The United States Court of Appeals for the District of Columbia (“D.C. Circuit”) recently upheld two FERC orders granting natural gas pipeline developers’ requests to extend their construction deadlines. The D.C. Circuit denied the Sierra Club’s petitions for review of the extension orders because the court determined that FERC’s decisions were reasonable and adequately supported by the record. The D.C. Circuit further provided that FERC has broad discretion in determining whether a developer has demonstrated good cause for an extension and whether circumstances have changed enough to warrant revisiting FERC’s original findings.
Troutman Pepper Summary of FERC Order No. 2023-A on Generator Interconnections
Executive Summary
On March 21, the Federal Energy Regulatory Commission (FERC or the Commission) issued Order No. 2023-A (Final Rule), which reaffirmed aspects of Order No. 2023 — the Commission’s landmark order updating its generator interconnection procedures. As detailed further in this summary, the Commission largely upheld Order No. 2023, including some of the more controversial aspects of the order, such as penalties and the transmission capacity “heat map,” and provided further clarity on other aspects.
FERC Approves Changes to PJM Capacity Accreditation Rules; Rejects Proposed Changes Seeking to Better Reflect Risk in Capacity Market Offers.
On January 30, 2024, FERC approved, subject to condition, PJM’s proposal to reform its Reliability Pricing Model, including resource adequacy risk modeling, capacity accreditation, testing requirements for capacity resources, and the Capacity Performance stop loss (“Modeling Enhancements Filing”). In that same order, FERC approved PJM’s proposal to replace its previously effective average Effective Load Carrying Capability (“ELCC”) capacity accreditation method with a marginal approach, effective December 12, 2023. The order directed PJM to submit a compliance filing to make certain revisions to its proposal, which PJM subsequently submitted on February 16, 2024. Additionally, on February 6, 2024, FERC rejected a companion PJM proposal to modify the rules governing its Market Seller Offer Cap and Capacity Performance construct and adopt a forward-looking Energy and Ancillary Service (“EAS”) offset for purposes of calculating the Minimum Offer Price Rule (“MOPR”) and offer cap.
FERC Rejects Solar Developer’s Request for Waiver of Security Posting Requirements After Using the Wrong Form; FERC Urges Tariff Changes
On November 30, 2023, the Commission denied a waiver request and a request for remedial relief from Ridgeview Solar LLC (“Ridgeview Solar”). Ridgeview Solar had sought a waiver or remedial relief from the procedural deadline in section 212.4 of the PJM Interconnection, L.L.C. (“PJM”) Open Access Transmission Tariff (“Tariff”) to post security after the deadline outlined in the section.