On February 18, 2021, FERC issued two orders terminating the proceedings stemming from the Department of Energy’s (“DOE”) Proposed Rule on Grid Reliability and Resilience (“Proposed Rule”). FERC previously established rulemaking proceedings in Docket No. RM18-1-000 to consider the proposed rule, which was submitted to FERC by the DOE in September 2017 pursuant to the Department of Energy Organization Act section 403 (“DOE Proposed Rulemaking Proceeding”). FERC terminated the DOE Proposed Rulemaking Proceeding on January 8, 2018 (see January 17, 2018 issue of the WER), instead opening an inquiry proceeding in Docket No. AD18-7-000 (“Inquiry Proceeding”) to evaluate the resilience of the bulk power system in the regions operated by regional transmission organizations (“RTOs”) and independent system operators (“ISOs”). On February 18, 2021, FERC: 1) issued an order on rehearing that sustained its decision to terminate the DOE Proposed Rulemaking Proceeding in Docket No. RM18-1-000; and 2) terminated the Inquiry Proceeding in Docket No. AD18-7-000.  Commissioner Neil Chatterjee issued a dissenting opinion in the order terminating the Inquiry Proceeding.
Continue Reading FERC Sustains Prior Termination of Grid Reliability and Resilience Rulemaking Proceeding; Terminates Grid Resilience Inquiry Proceeding

On February 18, 2021, FERC denied a rehearing request for an order it issued in October of 2020 that stated that payments received under the Commercial System Distribution Load Relief Programs (“CSRPs”) may not be excluded from the offer floors for Special Case Resources’ (“SCR”) calculation under the New York Independent System Operator, Inc.’s (“NYISO”) buyer-side market power mitigation (“BSM”) rules. Although FERC denied the request for rehearing, FERC modified and set aside the October 2020 Order in part, finding that the identified CSRPs should be excluded from the calculation of SCR offer floors in NYISO. Commissioners Clements and Christie issued concurring opinions.

Continue Reading FERC Exempts Certain Demand Response Programs from NYISO’s Buyer-Side Market Power Mitigation Rules

On January 20, 2021, President Joseph Biden issued Executive Order No. 13990 (“Executive Order”), which, among other things, suspended Executive Order 13920, “Securing the United States Bulk-Power System” (“Executive Order 13920”) until April 20, 2021 and directed all executive departments and agencies to review and take action to address all actions taken during former-President Donald Trump’s tenure in office that conflict with President Biden’s stated goals of improving public health, environmental protection, reducing greenhouse gas emissions, bolstering resilience to the impacts of climate change, and confronting the climate crisis.
Continue Reading President Biden Suspends Bulk Power System Executive Order; Directs Agencies to Address Public Health- and Climate-Related Rules

On January 19, 2021 FERC issued an order on the North American Electric Reliability Corporation’s (“NERC”) compliance filings submitted pursuant to the Commission’s January 2020 order on NERC’s five-year performance assessment. FERC’s January 19 order approved NERC’s proposed modifications to its Rules of Procedure regarding: (1) Electricity Information Sharing and Analysis Center (“E-ISAC”); (2) Sanction

On December 21, 2020, FERC modified its previous cost-of-service compensation decisions allowing Constellation Mystic Power, LLC (“Mystic”) to continue operating two gas-fired generation facilities (“Mystic 8 and 9”) fueled exclusively by an affiliate, Everett Marine Terminal (“Everett”), which, like Mystic, is owned by Exelon Generation Company, LLC (“Exelon”). Commissioner Richard Glick dissented, reiterating his belief that FERC has exceeded its jurisdiction to “bail out” the liquified natural gas (“LNG”) import terminal.
Continue Reading FERC Alters Mystic’s Cost-of-Service Agreement; Commissioner Glick Dissents Again

On December 17, 2020, FERC issued a Notice of Proposed Rulemaking proposing to revise its regulations to establish incentives for public utilities to make certain cybersecurity investments that go beyond the current requirements of the Critical Infrastructure Protection (“CIP”) Reliability Standards established by the North American Electric Reliability Corporation (“NERC”) (“Cybersecurity NOPR”). Specifically, FERC proposed rules to allow regulated entities to:

  1. receive incentive-based rate treatment for the voluntary implementation of: (i) certain NERC CIP Reliability Standards to facilities that are not currently subject to those requirements (“NERC CIP Incentives Approach”), and/or (ii) certain security controls included in the National Institute of Standards and Technology Framework (“NIST Framework Approach”);
  2. request a return-on-equity adder of two hundred (200) basis points for making eligible cybersecurity capital investments; and
  3. defer cost recovery of certain cybersecurity costs that are generally expensed as incurred, and treat such costs as regulatory assets that may be included in transmission rate base.


Continue Reading FERC Issues Notice of Proposed Rulemaking on Cybersecurity Investment Incentives

On October 30, 2020, FERC rejected ISO New England Inc.’s (“ISO-NE”) proposed revisions to the ISO-NE tariff to resolve long-term fuel security concerns in the New England region. FERC found that ISO-NE’s proposed solutions would substantially increase consumer costs without meaningfully improving fuel security in the region, and offered guidance on how ISO-NE might develop a just and reasonable approach to address its fuel security concerns.
Continue Reading FERC Rejects ISO-NE’s Long-Term Fuel Security Proposal

On October 6, 2020, the California Independent System Operator (“CAISO”), California Public Utilities Commission (“CPUC”), and the California Energy Commission (“CEC”) (collectively, “Joint Entities”) announced that their preliminary analysis pointed to a number of factors that caused two mid-August electricity outages in CAISO. Specifically, the group’s Preliminary Root Cause Analysis report (“Preliminary Analysis”) concluded that the outages resulted from a convergence of factors, including (i) the extreme west-wide heat storm, (ii) shortfall in system planning, and (iii) certain day-ahead energy market practices.  As directed by Governor Newsom, the Preliminary Analysis includes immediate, near, and longer-term actions that can be taken to minimize future power outages.

Continue Reading CAISO, CEC, and CPUC Conclude Several Factors Caused Mid-August Outages in California

On September 29, 2020, in response to a request for rehearing, FERC issued an order modifying the discussion in, while sustaining the result of, a prior order finding that PJM Interconnection, L.L.C. (“PJM”) was not in compliance with three of the five criteria of Order No. 1000’s immediate need reliability project exemption (“Immediate Need Exemption”). Concurrently, in a separate order, FERC modified, while sustaining the result of, an order where it found that ISO New England Inc.’s (“ISO-NE”) implementation of the Immediate Need Exemption was not unjust, unreasonable, or unduly discriminatory or preferential.
Continue Reading FERC Sustains PJM and ISO-NE Immediate Need Reliability Project Exemption Orders

On September 23, 2020, staff from the North American Electric Reliability Corporation (“NERC”) and FERC (collectively, “Joint Staff”) issued a second joint white paper that reversed previous recommendations regarding publicly disclosing the identities of entities accused of Critical Infrastructure Protection (“CIP”) violations. As stated in the Second Joint Whitepaper, the previous recommendation to publicly disclose CIP violator names and other information raised “substantial risks to the security of the Bulk-Power System.” Accordingly, the Second Joint Whitepaper stated that from now on, NERC will request that CIP noncompliance filings be treated as Critical Energy/Electric Infrastructure Information (“CEII”). FERC Staff will also designate such filings as CEII in their entirety.  Additionally, because of the risk associated with the disclosure of CIP noncompliance information, NERC will no longer publicly post redacted versions of CIP noncompliance filings and submittals.
Continue Reading FERC and NERC Staff Reverse Course, Opt for Confidentiality on CIP Violations