Troutman Pepper Locke

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On July 16, 2015, the Commission issued a Notice of Proposed Rulemaking (“NOPR”) in which it proposed, among other things, to direct the North American Electric Reliability Corporation (“NERC”) to develop a new or modified Reliability Standard to provide security controls for supply chain management of industrial control system hardware, software, and computing and networking services associated with bulk electric system operations.  Comments are due 60 days after publication of the NOPR in the Federal Register.

On July 16, 2015, the Commission issued a final rule in which it eliminated the obligation to file Form 566 (Annual Report of a Utility’s 20 Largest Customers) for regional transmission organizations (“RTOs”), independent system operators (“ISOs”), and exempt wholesale generators (“EWGs”).  The final rule also eliminates the requirement to submit a Form 566 for public utilities that have not made any Form 566-reportable sales (i.e., sales to customers who purchase the energy for purposes other than for resale) in any of the three preceding years.  Lastly, the final rule eliminates the requirement for public utilities submitting Form 566 to identify individual residential customers by name and address, and eliminates the requirement to notify customers listed on the Form 566 of their designation.

On July 7, 2015, the Commission issued a notice calling for comments on a Petition for Rulemaking filed by the American Wind Energy Association (“AWEA”) on June 19, 2015 in Docket No. RM15-21-000.  In its petition, AWEA requested that the Commission initiate a rulemaking to significantly amend the pro forma Large Generator Interconnection Procedures (“GIP”) and Large Generation Interconnection Agreement (“GIA”), in order to alleviate what it described as “unduly discriminatory and unreasonable barriers to generator market access.”  Comments on the petition are due August 6, 2015.

On June 30, 2015, FERC approved most of the proposed tariff revisions in a joint proposal from the ISO New England, Inc. (“ISO-NE”) and the New England Power Pool (“NEPOOL”) Participants Committee addressing the ISO-NE’s market monitor rules.  Specifically, the proposed revisions are designed to mitigate the potential to exercise market power in the ISO-NE Forward Capacity Auction (“FCA”), which is used to secure capacity in ISO-NE three years in advance of the relevant delivery year.  Going forward, the new rules approved by FERC will be implemented in ISO-NE’s next FCA in February 2016.

On June 16, 2015, the Commission denied a complaint filed by Public Service Electric and Gas Company (“PSEG”) against PJM Interconnection, L.L.C. (“PJM”) in which PSEG contended that PJM did not comply with certain rules of its Open Access Transmission Tariff (“OATT”) in conducting a competitive solicitation for transmission solutions to the “Artificial Island”— a term that refers to the transmission and generation infrastructure associated with a nuclear complex that includes the Salem 1, Salem 2, and Hope Creek nuclear generating units.  In denying PSEG’s complaint, the Commission found that: (i) PJM was not required to follow its Order No. 1000 procedures in its Artificial Island solicitation; and (ii) PJM complied with its pre-Order No. 1000 OATT rules in conducting the solicitation.

On June 18, 2015, FERC issued an order granting in part and denying in part a complaint, and instituting a 206 proceeding to examine the justness and reasonableness of MISO’s Facilities Construction Agreement (“FCA”), Generator Interconnection Agreement (“GIA”), and Multi-Party Facilities Construction Agreement (“MPFCA”).  FERC determined that MISO’s pro forma FCA and GIA may be unjust, unreasonable, or unduly discriminatory or preferential because they treat customers of an affected system operator and those of a directly-connected transmission owner differently without providing any increased level of service.  The case deals with the means by which transmission owners are compensated for network upgrades associated with generator interconnection requests. 

On June 18, 2015, FERC staff (“Staff”) provided an update on its implementation of the Hydropower Regulatory Efficiency Act of 2013 (the “Act”).  Staff stated that since the Act was signed into law, FERC has approved 43 qualifying conduit facilities – small hydropower projects that are exempt from FERC licensing requirements – out of 58 proposed facilities, while also granting 15 out of 30 requested permit extensions.  During FERC’s open meeting Commissioner Philip Moeller stated that he requested the update to bring more attention to the “enormous potential of small hydropower projects throughout the country.”

On June 16, 2015, the U.S. Court of Appeals for the District of Columbia Circuit (“D.C. Circuit”) denied a consolidated Petition for Review of several of Kern River Gas Transmission Company’s (“Kern River”) FERC-approved transportation rates.  In doing so, the D.C. Circuit held that FERC acted reasonably in setting the rates, responded meaningfully to rate objections, and articulated a rational explanation of its decisions.

On June 18, 2015, the Commission issued two separate Notice of Proposed Rulemakings (“NOPRs”) in which it proposed to approve several mandatory Reliability Standards submitted by the North American Electric Reliability Corporation (“NERC”).  The proposed Reliability Standards broadly address the areas of Transmission Operations (“TOP”), Interconnection Reliability Operations and Coordination (“IRO”), Emergency Preparedness (“EOP”), and Undervoltage Load Shedding (“UVLS”).  If approved, the proposed Reliability Standards would replace several currently-effective NERC Reliability Standards.

At its June 18, 2015 monthly Commission meeting, FERC issued a final rule adopting revisions to Rule 508 of its Rules of Practice and Procedure which eliminate the requirement that participants in FERC trial-type evidentiary hearings provide paper copies of all exhibits introduced as evidence.  According to FERC, the final rule facilitates a shift toward electronic hearing procedures, while still retaining the option to provide exhibits in paper form.