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On January 29, 2019, FERC rejected the New England Power Pool Participants Committee’s (“NEPOOL”) proposed revisions to its Second Restated NEPOOL Agreement (“NEPOOL Agreement”) that would have disqualified members of the press from being eligible to become NEPOOL members.  NEPOOL argued that the proposed revisions (“NEPOOL Press Amendments”) were necessary because allowing members of the press as NEPOOL members would undermine the effectiveness of the NEPOOL stakeholder process.  FERC rejected the revisions in part because, according to FERC, NEPOOL did not show that the revisions were just and reasonable and not unduly discriminatory or preferential.

In orders issued on January 25 and 28, 2019, FERC concluded that the Commission and the bankruptcy courts have concurrent jurisdiction to review and address the disposition of FERC-jurisdictional contracts sought to be rejected through bankruptcy and, therefore, a party to a FERC-jurisdictional wholesale power agreement must first obtain approval from both FERC and the bankruptcy court to modify the filed rate and reject the filed wholesale power contract, respectively.  FERC made its determination in response to two separate petitions (“Petitions”) filed by NextEra Energy, Inc. and NextEra Energy Partners, L.P. (collectively, “NextEra”) and Exelon Corporation (“Exelon”), individually, against Pacific Gas and Electric Company (“PG&E”).  In those Petitions, NextEra and Exelon asked FERC to clarify its authority regarding the prospect of PG&E seeking to reject or amend FERC-jurisdictional wholesale power agreements in its anticipated bankruptcy proceeding.  On January 29, 2019, PG&E submitted its anticipated bankruptcy filing in the U.S. Bankruptcy Court for the Northern District of California.   

On January 18, 2019, FERC accepted PJM Interconnection, L.L.C.’s (“PJM”) proposed revisions to both PJM’s Amended and Restated Operating Agreement and Open Access Transmission Tariff (“Tariff”) designed to allow PJM to stop using certain resources to calculate the frequency regulation (“regulation”) market clearing price and reduce spikes in the clearing price in PJM’s regulation market.  FERC found the proposal to be a narrowly-tailored solution to the price spike problem, while noting that broader issues raised in protests regarding PJM’s proposal were beyond the scope of the proceeding and are currently pending before the Commission in other dockets regarding PJM’s regulation market design.

On January 8, 2019, FERC approved revisions to the PJM Interconnection, L.L.C. (“PJM”) Tariff and Operating Agreement regarding the use of transmission constraint penalty factors in its market operations.  PJM’s filing responds to new market transparency requirements set out in Order No. 844, the result of FERC’s rulemaking addressing uplift cost allocation and transparency in Regional Transmission Organizations (“RTOs”) and Independent System Operators (“ISOs”).  In accepting PJM’s proposed revisions, FERC found the revisions would provide transparency regarding PJM’s transmission constraint penalty factor procedures and also produce more transparent and appropriate pricing and investment signals that correspond to an underlying transmission constraint.

On December 20, 2018, FERC proposed to revise the horizontal market power analysis required for electric power sellers seeking to obtain or retain market-based rate authority in certain organized wholesale power markets (“NOPR”).  Specifically, FERC proposed to relieve electric power sellers of the obligation to submit indicative screens when seeking to obtain or retain market-based rate authority in any Regional Transmission Organization (“RTO”)/Independent System Operator (“ISO”) market with FERC-approved RTO/ISO monitoring and mitigation, thus easing the regulatory burden for certain market-based rate sellers.  However, FERC proposed to continue to require market-based rate sellers in an RTO/ISO to submit indicative screens for authorization to make capacity sales at market-based rates in any RTO/ISO market that lacks an RTO/ISO-administered capacity market subject to FERC-approved RTO/ISO monitoring and mitigation.

On December 3, 2018, FERC accepted ISO New England Inc.’s (“ISO-NE”) proposed temporary revisions to its Transmission, Markets and Services Tariff (“Tariff”) designed to address fuel security by a 2-1 vote.  Among other things, the order enables ISO-NE to enter into cost-of service agreements with certain retiring generators that are deemed necessary for regional fuel security and reliability.  Commissioner McIntyre did not participate and Commissioner Glick issued a separate concurring opinion.  Of particular note was the dissenting opinion filed by Chairman Neil Chatterjee.

On December 3, 2018, FERC largely rejected a complaint filed by Monterey MA, LLC (“Monterey”) alleging that PJM Interconnection, L.L.C. (“PJM”) improperly adjusted prices after two transmission line outage events for unauthorized reasons, and without proper notice and documentation in violation of PJM’s Tariff.  Monterey requested that FERC reinstate original prices and that changes be made to the Tariff relating to price revisions so that re-pricing events are more transparent for market participants.  FERC mostly found that Monterey’s allegations were unreasonable and thus largely denied Monterey’s complaint, including Monterrey’s request to reinstate the original market prices.

On November 19, 2018, FERC denied a complaint filed by CXA La Paloma, LLC (“La Paloma”) requesting that FERC use its jurisdiction over resource adequacy to direct the California Independent System Operator Corp. (“CAISO”) to implement centralized capacity procurement.  FERC found that La Paloma failed to meet its burden to demonstrate that CAISO’s tariff was unjust, unreasonable, or unduly discriminatory or preferential under section 206 of the Federal Power Act.

On November 19, 2018, FERC accepted ISO New England Inc.’s (“ISO-NE”) request to terminate the capacity supply obligation (“CSO”) of the Clear River Unit 1 natural gas-fired generator (“Clear River”) for the 2021–2022 Capacity Commitment Period. In doing so, FERC found that ISO-NE had the right under its Tariff to terminate Clear River’s CSO because Clear River’s project sponsor, Invenergy Energy Management LLC (“Invenergy”), had covered Clear River’s CSO for two consecutive Capacity Commitment Periods. In the same order, FERC denied Invenergy’s request for waiver of certain provisions of ISO-NE’s Tariff related to the termination of Clear River’s CSO.