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On September 4, 2020, FERC rejected the New York Independent System Operator, Inc.’s (“NYISO”) proposed revisions to its buyer-side mitigation (“BSM”) rules that sought to prioritize storage, wind, solar, and other zero-emitting resources (“Public Policy Resources”) in NYISO’s Installed Capacity (“ICAP”) Market, rather than prioritizing new resources purely on a least-cost basis. While NYISO argued the state’s carbon and nitrogen oxide emissions reduction goals mean that a resource’s cost structure is no longer the best predictor of whether it will ultimately be developed, FERC held that NYISO’s proposal was unduly discriminatory because it prioritized Public Policy Resources over other non-Public Policy Resources. The decision sparked a dissent from Commissioner Richard Glick, who characterized FERC’s order as appearing to stake out the “radical” position that it is improper for NYISO to design its Tariff in a way that acknowledges state public policies, and a departure from FERC precedent focused on balancing the effects of state policies with measures to address how those policies affect capacity market prices.
Continue Reading FERC Rejects NYISO Buyer-Side Mitigation Proposal Aimed at Clean Energy Transition

On July 7, 2020, the PJM Interconnection, L.L.C. (“PJM”) Planning Committee held an informational session on its State Agreement Approach, a transmission planning process that allows one or more states to request the studying and funding of new transmission projects within the PJM footprint to address identified public policy needs. The State Agreement Approach could help accommodate the anticipated growth in offshore wind generation by allowing states to submit transmission expansion or extension projects in the Regional Transmission Expansion Plan (“RTEP”) so long as the states agree to assume responsibility for project costs.
Continue Reading PJM Planning Committee Holds Stakeholder Meeting About Process for States to Fund New Transmission Projects

In an order issued June 9, 2020, FERC accepted a proposal from the Midcontinent Independent System Operator, Inc. (“MISO”) to require certain solar generating facilities to respond to real-time dispatch signals by registering as Dispatchable Intermittent Resources (“DIRs”). Through MISO’s proposal, all solar resources entering commercial operation on or after March 15, 2020 must register as DIRs and become dispatchable by March 15, 2022, whereas solar resources in operation before March 15, 2020 have the option, but are not required, to obtain DIR registration. In accepting the proposal, FERC rejected arguments from one protestor that the proposal unduly burdened solar projects in late-stage development, finding that MISO’s proposed two-year transition period for such resources was reasonable.
Continue Reading FERC Accepts MISO Proposal to Require Dispatchable Intermittent Resource Registration for Solar Projects

On April 27, 2020, the Department of Energy’s (DOE) Water Power Technologies Office (WPTO) released a Request for Information (RFI) to gather information and feedback from hydropower industry stakeholders on its Hydropower Program Research and Development (R&D) Strategy and Hydro and Water Innovation for a Resilient Electricity System (HydroWIRES) Research Roadmap.
Continue Reading The Department of Energy’s Water Power Technologies Office Releases Request for Information on Hydropower Program

On May 27, 2020, the IRS issued Notice 2020-41, which provides much-anticipated relief for delays caused by the COVID-19 pandemic with respect to the “beginning of construction” requirements for renewable energy projects eligible for the production tax credit (“PTC”) or investment tax credit (“ITC”).

Notice 2020-41 modifies the guidance provided in Notices 2013-29,…

On April 13, 2020, numerous industry groups and business associations (“Industry Stakeholders”) submitted a joint request asking FERC to organize a technical conference or workshop to discuss potential issues with the implementation of state, regional, and national carbon pricing in regions with organized wholesale electric energy markets. The Industry Stakeholders proposed that the workshop examine both the mechanics needed to account for the implementation of carbon pricing as well as the mechanics that are already in place. Industry Stakeholders stated that such a conference could open a dialogue among stakeholders and interested parties regarding the opportunities and potential difficulties presented by carbon pricing.
Continue Reading Stakeholders Request FERC Technical Conference on Carbon Pricing

On January 29, 2020, thirty-six Democratic members of the U.S. House of Representatives (“Representatives”) signed a letter expressing their concern about FERC’s December 19, 2019 Order (“Order”) directing PJM Interconnection, L.L.C (“PJM”) to apply its Minimum Offer Price Rule (“MOPR”) to all state-subsidized capacity resources (see December 20, 2019 edition of the WER). According to the Representatives, the Order “nullif[ies]” state energy preferences, prohibits states from pursuing their policy goals, increases consumer costs by forcing them to buy duplicative capacity, runs contrary to FERC’s duty to ensure energy markets are truly competitive, and places deregulated markets at risk. The Representatives requested that the Commission provide a response to each concern discussed in the letter.
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Continue Reading House Democrats Express Concern over FERC’s PJM MOPR Order

On November 18, 2019, Anbaric Development Partners, LLC (“Anbaric”) filed a complaint against PJM Interconnection, L.L.C. (“PJM”) alleging that PJM’s transmission interconnection procedures deny meaningful open access interconnection service to merchant transmission projects designed to connect remote generation resources, including offshore wind generation, to the PJM transmission system (“Transmission Platform Projects”). Anbaric requested that FERC: find that the PJM Tariff is unjust, unreasonable and unduly discriminatory or preferential because it does not provide Transmission Platform Projects the opportunity to obtain material interconnection rights; direct that Transmission Platform Projects be given the opportunity to obtain material interconnection rights; and order PJM to modify its Tariff to include a new category of Transmission Platform Projects to connect remote renewable generation facilities to the PJM Transmission System. Anbaric also requested that any order from FERC apply to all of Anbaric’s projects with positions in PJM’s interconnection queue as of the date of its complaint.
Continue Reading Complaint Challenges PJM’s Denial of Interconnection Service to Transmission Projects Seeking to Connect Offshore Wind

On October 30, 2019, the House Committee on Energy & Commerce held a hearing in furtherance of its development of comprehensive climate legislation focused on reaching a 100 percent clean energy economy by 2050.  John Bear, the Chief Executive Officer of the Midcontinent Independent System Operator, Inc. (“MISO”) testified at the hearing while Southwest Power Pool, Inc. (“SPP”) and PJM Interconnection, L.L.C. (“PJM”) provided input in response to an earlier request from the Committee. The three Regional Transmission Organizations (“RTOs”) generally reported increases in both renewable and distributed generation in their regions over the past several years, highlighting the operational and reliability challenges that can come along with the growing prevalence of both. The RTOs also recognized the widely divergent state decarbonization policies and the associated impacts to the regional wholesale markets.
Continue Reading RTOs Weigh In on Decarbonization

On September 27, 2019, FERC approved CAISO tariff revisions to its voluntary Capacity Procurement Mechanism (“CPM”) and mandatory Reliability-Must-Run (“RMR”) framework such that all backstop procurement from resources that would otherwise retire or mothball will be addressed through CAISO’s RMR provisions. While FERC has traditionally considered RMR contracts as measures of last resort, FERC found it just and reasonable for CAISO to expand its use of such contracts to address evolving operational needs due, in part, to the increased penetration of variable energy resources in California. Commissioner Glick partially dissented, arguing that the approved tariff changes essentially provide CAISO “unchecked authority” to enter into out-of-market contracts to meet its resource adequacy needs.
Continue Reading FERC Allows CAISO to Expand use of RMR Contracts, Drawing Partial Dissent from Commissioner Glick