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On December 20, 2023, FERC approved the California Independent System Operator Corporation’s (“CAISO”) proposal to establish the Extended Day Ahead Market (“EDAM”), which allows external Balancing Authority Areas (“BAAs”) to participate in CAISO’s day-ahead market. FERC also approved CAISO’s Day Ahead Market Enhancements (“DAME”) proposal, which establishes two new day-ahead market products: Imbalance Reserves and Reliability Capacity. FERC approved the CAISO’s proposals but rejected the proposed EDAM access charge without prejudice. CAISO must submit a compliance filing addressing FERC’s conditions within sixty (60) days of the Order.

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.

On December 19, 2023, FERC issued a Notice of Inquiry (“NOI”) to examine whether and how to revise its policy on providing blanket authorizations for holding companies, including investment companies, to acquire securities in electric utilities and their upstream owners pursuant to section 203(a)(2) of the Federal Power Act (“FPA”). Specifically, the Commission is soliciting comment on what constitutes control of a public utility in evaluating holding companies’ requests for authorization and what factors it should consider when evaluating control. Commissioner Mark Christie concurred with a separate statement, stating that FERC should examine whether investment companies are truly acting as passive investors in electric utilities and whether FERC’s blanket authorization practices are still sufficient to protect the interests of the electric utilities’ customers.

On December 12, 2023, FERC staff offered information and recommendations to help registered entities (i.e., users, owners, and operators of the bulk electric system) improve their compliance with mandatory Critical Infrastructure Protection (“CIP”) reliability standards and their overall cybersecurity postures (the “Report”).  The recommendations are based on FERC staff’s non-public CIP audits of U.S.-based North American Electric Reliability Corporation (“NERC”) registered entities during Fiscal Year 2023, which included the participation of NERC and the regional entities.  FERC staff found that registered entities generally met the mandatory requirements of the CIP Standards, although potential noncompliance and security risks remained. FERC staff also identified and made recommendations concerning other voluntary best practices that could improve cybersecurity.  FERC staff explained that the CIP standards aim to mitigate cybersecurity and physical security risks to the bulk electric system’s facilities and equipment.  The Commission approved the first set of eight mandatory CIP standards on cybersecurity on January 28, 2008, and has since revised the standards to respond to emerging cybersecurity issues.  FERC began its CIP standards audit program for registered entities in 2016 and has conducted CIP audits each year since.  

On November 17, 2023, the U.S. Court of Appeals of the District of Columbia Circuit (“D.C. Circuit”) denied petitions challenging FERC’s approval of recent changes to the PJM Interconnection, L.L.C.’s (“PJM”) Open Access Transmission Tariff. The changes permit Transmission Owners in PJM to plan for “asset management projects” and certain End of Life (“EOL”) projects without satisfying PJM regional planning criteria. The D.C. Circuit also dismissed certain petitions for lack of standing.

Bridging the Gap Between Planning and Permitting

In recent decades, the U.S. has not been able to construct the volume of high-voltage backbone transmission facilities needed to support the country’s move to a ‘greener’ power system. The inability to build sufficient transmission infrastructure thwarts customer demands for a greener power mix.

In this report, we offer perspectives from a range of transmission experts about where the major roadblocks exist, and the latest regulatory and legal changes that promise to bring greater unity between the divergent federal planning and state siting and permitting processes. These changes provide hope that the U.S. can bridge the gaps that have delayed much-needed upgrades to the transmission system.

On November 16, 2023, FERC granted Virginia Electric and Power Company d/b/a Dominion Energy Virginia’s (“Dominion”) petition requesting the Commission declare that Dominion’s planned liquefied natural gas (“LNG”) production, storage, and regasification facility (“Back-up Fuel Project” or “Project”) in Greensville County, Virginia would be exempt from the Commission’s jurisdiction under section 7 of the Natural Gas Act (“NGA”). In so doing, FERC determined the Project satisfied the “Hinshaw Exemption” under NGA section 1(c).

On November 16, 2023, FERC staff issued the 2023-2024 Winter Energy Market and Electric Reliability Assessment report, projecting trends and identifying considerations for energy markets and electric reliability for the upcoming winter (December through February). The report focuses on weather outlook, the state of the natural gas and electricity markets, and initiatives implemented in the wake of Winter Storm Elliott.

On September 29, 2023, FERC accepted part of Arizona Public Service Company’s (“APS”) proposed interconnection queue reforms to transition from a first come, first served cluster study process to a first ready, first served cluster study process. Generally, FERC accepted APS’s proposals that would prevent speculative projects from moving through the queue, while rejecting proposals that were not consistent with or superior to the pro forma Large Generator Interconnection Procedures (“LGIP”). APS’s interconnection queue reform proposal was submitted before FERC issued Order No. 2023; the approved reforms do not constitute APS’s Order No. 2023 compliance filing and are based on FERC’s currently effective pro forma LGIP.

On October 30, 2023, FERC accepted the California Independent System Operator Corporation’s (“CAISO”) revisions to its wheeling tariff provisions. The revised provisions allow external load serving entities to obtain, in advance, on a monthly and daily basis, rights to transmit electricity (also known as “wheeling”) through self-schedule priorities equal to the scheduling priority of CAISO demand. The revised provisions also update CAISO’s calculation of Available Transfer Capability (“ATC”).