On Monday, March 25, 2019, ISO New England, Inc. (“ISO-NE”) filed a proposal with FERC for an interim inventoried energy program that would provide incremental compensation to generation resources that store fuel onsite during winter months. ISO-NE’s filing explains that a key contributor to the region’s winter energy security concerns is its reliance on gas deliveries from the interstate pipeline network, which can become constrained during winter cold spells, and that lack of on-site fuel sources during these cold spells can lead to loss of load events. ISO-NE seeks to reduce this concern by directly compensating generation resources for maintaining “inventoried energy,” defined as “fuel or potential energy that a resource can convert to electric energy at the ISO’s direction.” The proposal is intended as an interim measure to complement the ISO’s ongoing efforts to develop a long-term, market-based solution to the region’s fuel security challenges. The ISO believes that the program will contribute to the region’s winter energy security by providing incremental revenue to generation resources that store fuel on-site, reducing the amount of revenue those resources must recover through the capacity market, and decreasing the likelihood that such resources will seek to retire. However, ISO-NE also clarified that it cannot guarantee that the program will “incent specific resources to take precise actions that improve winter energy security or deter any particular resource that would otherwise be economic from retiring.”
Missouri Public Service Commission Grants Certificate of Convenience and Necessity to Grain Belt Express Transmission Line
On March 20, 2019 the Missouri Public Service Commission (“MPSC”) granted a certificate of convenience and necessity (“CCN”) to Grain Belt Express Clean Line LLC (“Grain Belt”) for a $2.35 billion, 780-mile, 600 kV transmission line that is planned to deliver wind-generated electricity from western Kansas to customers in both MISO and PJM. While the MPSC previously denied Grain Belt’s application for a CCN in a 2015 decision that cited burdens to affected landowners, its March 20 order concludes that “the broad economic, environmental, and other benefits of the Project to the entire state of Missouri outweigh the interests of the individual landowners,” whose concerns would be “addressed through carefully considered conditions placed on the CCN.”
FERC Issues Rare Denial of Proposed Transmission Line Acquisition
On March 6, 2019, FERC denied GridLiance GP, LLC’s (“GridLiance”) proposal (“Proposed Transaction”) to acquire from People’s Electric Cooperative certain transmission lines and related facilities (“Assets”). In its order, FERC concluded that GridLiance failed to demonstrate that the benefits of its ownership of the facilities would offset the rate increases that GridLiance acknowledged would result from the Proposed Transaction. However, because FERC denied the proposal without prejudice, GridLiance can make a new filing that, according to FERC “proposes adequate ratepayer protection and demonstrates specific additional benefits to offset a rate increase.”
FERC Announces Technical Conference on Reliability of the Bulk-Power System
On February 25, 2019, FERC issued a notice that the Commission will lead a technical conference on policy issues related to the reliability of the Bulk-Power System.
FERC Amends Its Interlocking Officers and Directors Regulations
On February 21, 2019, FERC issued a Final Rule, Order No. 856, amending its regulations related to interlocking officers and directors in response to a Notice of Proposed Rulemaking (“NOPR”) issued on July 18, 2018 to revise Parts 45 and 46 of its regulations (see July 24, 2018 edition of the WER).
FERC Finalizes Rule Implementing AWIA Hydro Project Reforms
On February 22, 2019, FERC issued a final rule (“Order No. 857”) conforming FERC’s regulations to the America’s Water Infrastructure Act (“AWIA”), which amended sections of the Federal Power Act (“FPA”) pertaining to preliminary permits, qualifying conduit hydropower facilities, and start for payment of annual charges.
FERC Approves Changes to NYISO Transmission Planning Process
On February 8, 2019, FERC approved nine revisions to the New York Independent System Operator, Inc. (“NYISO”) Tariff addressing its Public Policy Transmission Planning Process. While the changes mainly provide additional process and transparency to NYISO’s existing procedures, NYISO also removed the requirement that the New York Public Service Commission (“New York Commission”) issue an order confirming the transmission need before NYISO can move forward with its planning process.
2nd Circuit Vacates New York’s Denial of Water Quality Certification for Gas Pipeline
On February 5, 2019, in an unpublished summary order, a three-judge panel of the U.S. Court of Appeals for the 2nd Circuit (“2nd Circuit”) overturned the New York State Department of Environmental Conservation’s (“New York DEC”) denial of a water quality certification for National Fuel Gas Supply Corporation’s (“National Fuel”) Northern Access Pipeline Project and remanded it back to the state for further explanation.
Commissioner LaFleur Will Not Pursue Another Term
On January 31, 2019, Commissioner Cheryl LaFleur announced that she is no longer seeking a third term and will be leaving FERC this year. Commissioner LaFleur stated that she plans to stay at least until her current term expires, on June 30, 2019, and may stay longer depending on her plans and the appointment of her successor.
FERC Issues Notice on Proposed Hydropower Rules
On January 31, 2019, pursuant to Public Law No. 115-270, the America’s Water Infrastructure Act (“AWIA”), FERC issued a notice soliciting comments on proposed rules to establish expedited licensing processes for qualifying projects at existing nonpowered dams and closed-loop pumped storage facilities.