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On December 29, 2009, Alleghany Energy Inc. (“Allegheny”) and American Electric Power Co. (“AEP”) announced that they are suspending the Virginia portion of their 270-mile high-voltage Potomac-Appalachian Transmission Highline project (“PATH Project”). 

On December 18, 2009, FERC conditionally approved PJM Interconnection, L.L.C.’s (“PJM”) Order No. 719 compliance filing, which contained proposed revisions to the PJM tariff regarding organized wholesale electricity markets.  The Commission also clarified the market power mitigation roles of PJM and Monitoring Analytics, PJM’s independent market monitoring unit (“MMU”), in the order.

On December 17, 2009, regulators of Energy Corp.’s retail operations announced the formation of the Entergy Regional State Committee (“E-RSC” or “Committee”), comprised of regulators from the Arkansas Public Service Commission, Louisiana Public Service Commission, Mississippi Public Service Commission, the Public Utility Commission of Texas, and the City of New Orleans’ City Council.

On December 7, 2009, the U.S. Department of Energy (“DOE”) announced the issuance of a final rule amending certain provisions of its loan guarantee program for innovative technologies as authorized by Section 1703 of Title XVII of the Energy Policy Act of 2005 (“Final Rule”). The amendments reverse the DOE’s previous interpretation of two provisions of Section 1702 of Title XVII to require a superior first lien on any property acquired pursuant to a guarantee. The Final Rule was promulgated by the DOE after its review of all comments submitted in response to the DOE’s Notice of Proposed Rulemaking and Opportunity for Comment published on August 7, 2009 (“NOPR”). (Please refer to our summary of the NOPR circulated on August 7, 2009, for more information on the proposed changes.)

On December 17, 2009, the Federal Energy Regulatory Commission (“FERC” or the “Commission”) released an order (“Enforcement Order”) that authorizes the Secretary of the Commission to issue a Staff’s Preliminary Notice of Violations (“Notice”) after the entity that is subject to an investigation has been given the opportunity to respond to staff’s preliminary findings.  Additionally, the Commission released a Policy Statement where the Office of Enforcement (“OE”) will provide exculpatory evidence to those entities subject to their investigations and respondents in administrative enforcement proceedings. 

On December 17, the Environmental Protection Agency (“EPA”) Administrator Lisa Jackson issued a decision requiring the Kentucky Department of Air Quality (“KDAQ”) to consider whether the proposed Cash Creek Integrated Gasification Combined Cycle (“IGCC”) plant should consider generating electricity with natural gas rather than the syngas produced in the gasification process.  The decision was issued in the context of determining the Best Available Control Technology (“BACT”) requirements in Cash Creek’s Prevention of Significant Deterioration (“PSD”) permit. EPA said that natural gas might be a lower polluting fuel than syngas.