In an April 29, 2016 order regarding cost allocation among the Entergy operating companies, FERC clarified and distinguished its approach to refunds in cost allocation and rate design cases, from its approach to refunds in cases of utility over-recovery (“April 29 Order”). Specifically, FERC clarified that it will generally decline to order refunds under disputes over cost allocation, whereas refunds will generally be awarded in cases involving allegations of a utility earning more than a just and reasonable rate during the refund period.
Continue Reading FERC Clarifies its Refund Policy in Cost Allocation Disputes

On April 27, 2016, the Federal Energy Regulatory Commission (“FERC”) granted two concurrent complaints requesting FERC rescind waivers of its affiliate power sales restrictions that it previously granted to two Ohio franchised public utilities, as those waivers relate to particular power sales contracts (“Affiliate PPAs”). The utilities in question are AEP Generation Resources, Inc. (“AEP Generation”) and Ohio Power Company (“AEP Ohio,” and together with AEP Generation, the “AEP Respondents”) in Docket No. EL16-33; and FirstEnergy Solutions Corporation (“FE Solutions”) and FirstEnergy Corporation’s Ohio regulated utilities (“FE Ohio,” and together with FE Solutions, the “FE Respondents”) in Docket No. EL16-34. Going forward, FERC will evaluate the transactions contemplated in the Affiliate PPAs under the standards set forth in Boston Edison Co. Re: Edgar Electric Energy Co. and Allegheny Energy Supply Co. 
Continue Reading FERC Grants Requests to Rescind Waivers of Its Affiliate Power Sales Restrictions that It Previously Granted to AEP and FirstEnergy

On April 21, 2016, FERC issued an order denying Viridity Energy, Inc.’s (“Viridity”) complaint alleging that PJM Interconnection, L.L.C.’s (“PJM”) Open Access Transmission Tariff (“OATT”) and the parallel provisions of the PJM Operating Agreement are unduly discriminatory as applicable to end users that register under PJM’s Emergency Load Response Program’s Capacity Only option, as opposed to the Full Program Option, because Capacity Only resources do not receive the guaranteed energy payment that Full Program Option participants receive despite being similarly situated. In the order, FERC found that the distinctions between the program participants are justified by the need to avoid errors in measurement and verification that may be caused by Capacity Only participants inadvertently submitting duplicate offers.
Continue Reading FERC Denies Complaint Alleging that PJM’s Emergency Load Response Program Forces Demand-Response Resources to Forfeit Compensation

On April 28, 2016, FERC issued an Order to Show Cause and Notice of Proposed Penalty (“Order to Show Cause”) against Total Gas & Power North America, Inc. (“TGPNA”), Aaron Hall (“Hall”), and Therese Tran (“Tran”) for alleged natural gas market manipulation at four locations in the southwest United States between June 2009 and June 2012. The Order to Show Cause also directs these parties to show cause why TGPNA should not be required to disgorge $9.18 million (plus interest) in unjust profits, and the parties be assessed civil penalties in the amounts of $213,600,000 for TGPNA, $1,000,000 for Hall, and $2,000,000 for Tran. In addition, the Commission directed TGPNA’s ultimate parent company, Total, S.A. (“Total”), and TGPNA’s affiliate, Total Gas & Power, Ltd. (“TGPL”), to show cause why they should not be held liable for TGPNA’s, Hall’s, and Tran’s conduct and held jointly and severally liable for their disgorgement and civil penalties.
Continue Reading FERC Issues Show Cause Order Against Total Gas & Power and its Employees for Alleged Cross-Market Manipulation

In two orders issued on April 21, 2016, FERC denied a complaint and upheld the Midwest Independent System Operator, Inc. (“MISO”) registration requirements for Entergy qualifying facilities (“QFs”), and also denied rehearing and upheld termination, in part, of Entergy’s mandatory purchase obligation for QFs with access to the MISO market under Section 210(m) of the Public Utility Regulatory Policies Act (“PURPA”).
Continue Reading FERC Upholds MISO Registration Requirements for Entergy QFs and Upholds Order Terminating in Part Entergy’s PURPA Mandatory Purchase Obligation

On April 21, 2016, the Federal Energy Regulatory Commission (“FERC”) denied a complaint from Monitoring Analytics, LLC, the independent market monitor (“Market Monitor”) for PJM Interconnection, L.L.C. (“PJM”), alleging that PJM’s existing capacity market rules fail to treat demand response resources in a manner comparable to generation capacity resources. Specifically, the Market Monitor asserted that demand response resources should be subject to: (i) a must-offer requirement, as applicable to PJM’s day-ahead energy market; and (ii) an offer cap on all energy offers, as applicable to generation resources.
Continue Reading FERC Denies Complaint for Identical Treatment of Demand Response Resources and Generation Resources in PJM’s Capacity Market