On May 26, 2023, the Commission accepted Southwest Power Pool, Inc.’s (“SPP”) proposed revisions to its Tariff to establish the “framework under which an electric storage resource may be considered a transmission asset.” Continue Reading FERC Approves SPP Proposal for Energy Storage to Be Considered Transmission-Only Assets

On May 4, 2023, the Senate Energy and Natural Resources Committee hosted all four FERC Commissioners for an oversight hearing to focus on reliability in the face of (1) cyber-attacks, (2) coal and natural gas plant retirements, (3) severe weather, and (4) subsidies, climate policies, and market signals that encourage more intermittent resources to come online.Continue Reading FERC Commissioners Answer to Senate Committee on Fleet Transformation and Other Pressing Issues

On March 3, 2023, the House Energy and Commerce Committee Chair Cathy McMorris Rodgers (R-WA) and Energy, Climate Change, and Grid Security Subcommittee Chair Jeff Duncan (R-SC) sent a letter to Acting FERC Chairman Willie Phillips and Commissioners asking the Commission to respond to a series of questions related to FERC’s authority as it relates to two policy statements issued in February 2022 and a Notice of Proposed Rulemaking (“NOPR”) issued in December 2022. The two policy statements concern Greenhouse Gas (“GHG”) emissions of natural gas infrastructure projects (see February 18, 2022 Troutman Pepper Insights; February 23, 2022 edition of the WER). The NOPR would require applicants proposing to build electric transmission infrastructure to prepare Environmental Justice Public Engagement Plans.Continue Reading House Republicans Press FERC on Environmental Review Issues

On March 16, 2023, FERC granted a petition declaring that, should it issue orders pursuant to Sections 210 and 211 of the Federal Power Act (“FPA”), which would be required for a prospective project to interconnect Puerto Rico’s transmission system to the U.S. mainland bulk electric system, such orders would “not render Puerto Rico’s electric utilities ‘public utilities’ under section 201(e) of the FPA. However, FERC reserved the right to make a fact-specific determination at the time any application for such interconnection is sought and further affirmed that, regardless of “public utility” status, FERC would retain jurisdiction over Puerto Rico’s electric utilities pursuant to sections 210, 211, 211A, 212, and 215 of the FPA.Continue Reading FERC Confirms that Orders Under Sections 210 and 211 of the Federal Power Act Would Not Generally Confer “Public Utility” Jurisdiction over Puerto Rico’s Electric Utilities

On February 21, 2023, FERC accepted PJM Interconnection, L.L.C.’s (“PJM”) proposed tariff revisions governing the Locational Deliverability Area Reliability Requirement (“LDA Reliability Requirement”) calculation, effective December 24, 2022, and applicable to the 2024/2025 Base Residual Auction (“BRA”), which was in progress at the time that PJM submitted its filing. Specifically, FERC accepted tariff changes that would allow PJM, during the BRA process, to exclude Planned Generation Capacity Resources from the LDA Reliability Requirement calculation if the addition of such resources materially increases the reliability requirement and such resources do not participate in the capacity auction. The February 21 Order also dismissed as moot a complaint filed by PJM challenging the justness and reasonableness of the existing LDA Reliability Requirement. Finally, the February 21 Order stated that FERC would soon convene a forum to examine the functioning of the PJM capacity market. Commissioner Danly issued a separate dissenting statement.Continue Reading FERC Accepts PJM Capacity Market Revisions to Locational Deliverability Area Reliability Requirement, Sparks Strong Dissent from Commissioner Danly

On January 31, 2023, the Federal Energy Regulatory Commission (“Commission” or “FERC”) granted Great River Energy’s (“GRE”) requested incentive rate treatment for GRE’s investment in the Iron Range Project and Big Stone Project (collectively, “Projects”). Notwithstanding FERC’s approval, Commissioner Christie’s separate concurrence highlighted persistent concerns over the Commission’s incentive rate treatment policy.Continue Reading FERC Commissioner Christie Renews Concerns Over Transmission Rate Incentives in MISO Transmission Expansion Plan Order

On January 27, 2023, FERC approved the Midcontinent Independent System Operator, Inc. (“MISO”) Transmission Owners’ (“TOs”) proposal to terminate reactive power charges and compensation under MISO’s Open Access Transmission, Energy, and Operating Reserve Markets Tariff (“Tariff”), effective December 1, 2022.  As a result, MISO will no longer charge transmission customers for reactive power service within the standard power range, and no generators, whether affiliated with the MISO TOs or not, will receive compensation for providing reactive power service within the standard power factor range.  Nevertheless, FERC’s determination does not affect MISO generators’ ongoing obligation to provide reactive power.  If MISO directs a generator to provide reactive power outside of the standard power factor range, the generator will be compensated based on existing mechanisms already included in MISO’s Tariff.  Continue Reading FERC Allows MISO Transmission Owners to Retroactively Terminate Reactive Power Compensation Back to December 2022

On December 16, 2022, FERC again rejected the Midcontinent Independent System Operator Inc. (“MISO”) proposal for Transmission Owners to self-fund Necessary Upgrades to connect Merchant High Voltage Direct Current (“HVDC”) transmission lines into MISO and addressed arguments on rehearing. Commissioner Danly dissented and Commissioner Christie concurred in separate statements. Chairman Glick did not participate.Continue Reading On Rehearing FERC Again Rejects MISO Proposal for Transmission Owners to Self-Fund Necessary Upgrades to Connect Merchant HVDC Lines

On December 15, 2022, FERC issued an order accepting Arizona Public Service Company’s (“APS”) revisions to its Open Access Transmission Tariff (“Tariff”) that would allow APS to begin using the Flowgate Methodology for calculating Available Transfer Capability (“ATC”) instead of its current Rated System Path Methodology. In addition, FERC denied APS’s request to waive the requirement to post its Total Transfer Capability (“TTC”) values on the Open Access Same Time Information System (“OASIS”).Continue Reading FERC Accepts Arizona Public Service Company’s Proposal to Adopt Flowgate ATC Methodology and Denies Its Request to Waive TTC Posting Requirements

On November 17, 2022, FERC issued three orders intended to address the reliability impacts of the rapid integration of inverter-based resources (“IBRs”), including solar, wind, fuel cell, and battery storage resources, on the Bulk-Power System (“BPS”). Specifically, in the first proceeding, FERC directed the North American Electric Reliability Corporation (“NERC”) to develop a plan to register the entities that own and operate IBRs so that NERC may monitor their compliance with NERC’s Reliability Standards. In the second proceeding, FERC issued a Notice of Proposed Rulemaking (“NOPR”) to direct NERC to develop new or modified Reliability Standards that address reliability gaps related to IBRs. Lastly, in the final proceeding, FERC approved revisions to two of NERC’s Reliability Standards.Continue Reading FERC Issues Proposals Regarding Inverter-Based Resources to Improve Grid Reliability