Sidney Villanueva

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On July 25, 2019, FERC issued an order directing PJM Interconnection, L.L.C. (“PJM”) “not to conduct the 2019 BRA” (Base Residual Auction) in August (“July 2019 Order”).  The 2019 BRA, which will procure capacity for the 2022-2023 Delivery Year, was already delayed from May to August while FERC considered how to apply the PJM Minimum Offer Price Rule (“MOPR”) to resources which receive out-of-market support, including Zero Emissions Credits (“ZECs”) and Renewable Energy Credits (“RECs”).  If the MOPR were applied to units receiving ZECs, RECs, or other out-of-market support, it is expected capacity market prices would be higher in some regions, and market revenues may be lower for some generators receiving ZECs or RECs or their off-takers.

On June 26, 2019, the U.S. District Court of Maine (“District Court”) denied a motion for leave to file an interlocutory appeal to the U.S. Court of Appeals for the First Circuit (“First Circuit”) ultimately concerning whether FERC’s enforcement action against Competitive Energy, LLC and its managing member Richard Silkman (collectively, “Respondents”) was time-barred.  The District Court previously denied two motions for summary judgment, relying on the First Circuit’s decision in United States v. Meyer (“Meyer”), which held that a FERC enforcement action accrues when FERC assesses a penalty, and therefore was not barred.  Respondents argued that the District Court should not have followed the First Circuit’s decision in Meyer because two subsequent United States Supreme Court (“Supreme Court”) decisions—Kokesh v. SEC (“Kokesh”) and Gabelli v. SEC (“Gabelli”)—have overruled Meyer.  In denying the motion for interlocutory appeal, the District Court held that whether Meyer continues to be good law does not present a “controlling question of law as to which there is a substantial ground for difference of opinion.” 

On March 21, 2019, the Commission issued a proposed order directing two wind energy generators, Cedar Creek Wind Energy, LLC (“Cedar Creek”) and Cedar Creek II, LLC (“Cedar Creek II”) (collectively the “Cedar Creek Entities”) to provide interconnection and transmission service to a proposed wind project, Mountain Breeze Wind, LLC (“Mountain Breeze”) across jointly-owned interconnection customer facilities (“ICIF”) to the Public Service Company of Colorado (“PSCo”) transmission system.  Although Cedar Creek II sought to dismiss the matter as an impermissible attempt by Mountain Breeze to acquire an ownership interest in the ICIF outside of a Federal Power Act (“FPA”) Section 203 or Section 205 proceeding, FERC rejected this characterization and instead found narrowly that Mountain Breeze had properly filed an application for Commission-ordered service under FPA Sections 210 and 211.  FERC directed the parties to attempt to reach an agreement on the terms and conditions for interconnection and transmission service, or a separate order prescribing such terms and conditions would be issued.

On March 11, 2019, PJM Interconnection, L.L.C. (“PJM”) made a filing informing FERC that it has begun advising Capacity Market Sellers to use both its existing capacity market rules, as well as its proposed Capacity Reform rules while it awaits a final order from FERC on the proposed reforms.  PJM stated that this approach ensures that all Capacity Market Sellers will have satisfied both the existing and PJM’s proposed pre-auction requirements prior to the conduct of the August 2019 Base Residual Auction (for the 2022/2023 Delivery Year) in anticipation of a Commission order.  The Capacity Reform rules include revised Minimum Offer Price (“MOPR”) rules and the “Resource Carve-Out” alternative.

On February 28, 2019, following a July 2018 voluntary remand order from the U.S. Court of Appeals for the District of Columbia Circuit (“D.C. Circuit”), FERC reversed tariff waivers it previously granted to the Southwest Power Pool, Inc. (“SPP”) regarding customer crediting payments for certain network upgrades.  FERC had granted a waiver of the one-year time bar for billing adjustments in SPP’s tariff so that SPP could retroactively reimburse transmission customers for qualifying network upgrade payments.  In its order on voluntary remand (“Remand Order”) however, FERC concluded that granting such a waiver would violate the filed rate doctrine.  As such, FERC directed the SPP to provide refunds and interest to affected transmission customers.

On February 21, 2019, FERC issued an order (“Order No. 845-A”) granting in part and denying in part various requests for rehearing and clarification of its determinations in Order No. 845.  In Order No. 845, FERC revised its interconnection rules for large generators, i.e., generators with capacities greater than 20 MW.  Although the requests for rehearing asked FERC to reconsider all but one of the Order No. 845 reforms, Order No. 845-A effectively leaves the major reforms intact, and focuses in large part on explaining FERC’s intentions as to how the new rules should work.  Compliance filings in response to both Order Nos. 845 and 845-A are due May 22, 2019.

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.