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In what appears to be the most significant enforcement action in its history, the Federal Energy Regulatory Commission (“FERC” or the “Commission”) on Friday, March 9 approved a Stipulation and Consent Agreement with Constellation Energy Commodities Group (“Constellation”) that imposes a record civil penalty of $135 million and requires the disgorgement of $110 million in unjust profits.

On February 29, 2012, PJM Interconnection LLC (“PJM”), in an attempt to reduce bottlenecks in its interconnection queue and provide greater certainty and transparency, filed proposed revisions to its Open Access Transmission Tariff.  These revisions are a result of PJM’s stakeholder process and are designed to alter the process for how generation projects are analyzed before being allowed to connect to the transmission grid.

On February 27, 2012, EPA proposed not to change its greenhouse gas (“GHG”) permitting thresholds for the Prevention of Significant Deterioration (“PSD”) and Title V Operating Permit programs.  Under the proposal, smaller emissions sources will continue to be exempt from obtaining a PSD permit, while larger GHG emissions sources will continue to require a PSD permit.

On February 27, 2012, FERC issued an order in Docket Nos. ER12-715 and EL-56 (not consolidated) allowing revisions in the Midwest Independent Transmission System Operator, Inc.’s (“MISO”) tariff, subject to clarification.  The proposed revisions would allow MISO to charge a Withdrawing Transmission Owner, defined as an owner of transmission facilities that withdraws its transmission facilities from the operational control of MISO after July 16, 2010, a monthly Multi-Value Project (“MVP”) usage rate that includes a share of the costs of all MVP projects that the MISO Board of Directors approved prior to the effective date of the transmission owner’s withdrawal.

On February 29, 2012, GenON Energy, Inc. (“GenON”) announced its 2011 financial results, and plans to deactivate 3,140 MW of generating capacity in the PJM Interconnection LLC (“PJM”) region between 2012 and 2015.  GenON’s news release pointed to costs for additional environmental controls and stated that “forecasted returns on investments necessary to comply with environmental regulations are insufficient.”

On February 22, 2012, Duke Energy Carolinas, LLC (“DEC”) and Progress Energy Carolinas, Inc. (“PEC”) filed with the North Carolina Utilities Commission a description of the revised merger-related market power mitigation plan it aims to submit to FERC next month (the “Revised Mitigation Plan”). 

On February 17, 2012, FERC issued notice of a technical conference on Reactive Power Capability.  The technical conference is being held to consider potential issues regarding the need for reactive power capability among newly interconnecting asynchronous generators and  the need and efficacy of continuing the process established for wind resources under Order No. 661-A.