On June 3, 2016, FERC accepted a compliance filing made by the New York Independent System Operator, Inc. (“NYISO”) providing for changes to the NYISO tariff in order to expand participation in NYISO’s Day-Ahead Demand Response Program (“DADRP”) to include demand response from behind-the-meter generation. The tariff changes will become effective 60 days after the issuance of the June 3, 2016 order.

On June 1, 2016, FERC granted the joint application of Elba Liquefaction Company, L.L.C. (“ELC”) and Southern LNG Company, L.L.C. (“Southern LNG”) requesting authorization to construct and operate new natural gas liquefaction and export facilities at Southern LNG’s existing liquefied natural gas (“LNG”) terminal located on Elba Island, Chatham County, Georgia (the “Elba Liquefaction Project”). FERC also granted Southern LNG’s request to abandon its LNG truck loading facilities at the terminal. In the same order, FERC granted the separate application of Elba Express Company, L.L.C. (“Elba Express”) to add north-to-south transportation capacity to the existing Elba Express pipeline system by constructing and operating additional compressors at the existing Hartwell Compressor Station in Hart County, Georgia, and constructing and operating two new compressor stations in Jefferson and Effingham Counties, Georgia (the “Elba Express Modification Project”). Elba Express proposed this expansion in part to enable Elba Express to transport domestic natural gas on a firm basis to the Elba Liquefaction Project.

On June 2, 2016, FERC issued a declaratory order finding Williams Field Services – Gulf Coast Company LP’s (“WGC”) proposed offshore facilities located on Transcontinental Gas Pipe Line Corporation’s (“Transco”) existing jurisdictional platform, including metering equipment on the platform and a 5.8-mile, 12-inch-diameter pipeline extending from that platform, to be gathering facilities exempt from FERC’s jurisdiction. Notably, FERC held that WGC’s proposed pipeline will primarily function as a gathering facility, despite being downstream from jurisdictional facilities, because WGC will not commingle gas that has moved through jurisdictional facilities.

On June 1, 2016, FERC granted the request by MoGas Pipeline LLC (“MoGas”) for abandonment authority to transfer by sale its jurisdictional natural gas pipeline facilities to an affiliate, CorEnergy Pipeline Company, LLC (“CorEnergy”), and certificate authority to lease the facilities back for continued operation by MoGas. MoGas stated that if its parent, Corridor MoGas, Inc. (“Corridor MoGas”), sells a majority stake in MoGas to an unaffiliated third party, the income from MoGas’s lease payments will qualify as non-taxable Real Estate Investment Trust (“REIT”) rental income.

On May 31, 2016, FERC rejected PJM Interconnection, L.L.C.’s (“PJM”) proposal to excuse a Capacity Performance Resource from Non-Performance Charges during emergency conditions. PJM proposed to excuse such resources from Non-Performance Charges when the resource followed PJM’s dispatch instructions and operated at a ramp rate PJM had previously approved. In refusing to allow the proposed exemption, FERC emphasized that “[i]t is critical that the capacity market rules send the proper long-term investment signals to ensure capacity that can meet the reliability needs of the region.”

On June 2, 2016, FERC conditionally accepted revisions to the California Independent System Operator Corporation’s (“CAISO”) tariff to facilitate the participation of aggregations of distribution-connected or distributed energy resources in CAISO’s energy and ancillary services markets. The proposed revisions are effective June 3, 2016, subject to CAISO submitting a compliance filing.

On May 19, 2016, FERC issued Order No. 816-A, denying requests for rehearing and granting certain requests for clarification of Order No. 816. Order No. 816 amended FERC’s regulations governing market-based rate (“MBR”) authorizations for wholesale sales of energy, capacity, and ancillary services by public utilities under the Federal Power Act (“FPA”).

On May 19, 2016, the Federal Energy Regulatory Commission (“FERC”) issued a policy statement regarding future implementation of hold harmless commitments offered by applicants as ratepayer protection mechanisms to mitigate adverse effects on rates that may result from transactions subject to section 203 of the Federal Power Act (“FPA”). The policy statement provides guidance in four areas related to hold harmless commitments: (1) the scope and definition of the costs that should be subject to hold harmless commitments; (2) controls and procedures to track the costs from which customers will be held harmless; (3) FERC’s continued acceptance of hold harmless commitments that are limited in duration; and (4) clarification that applicants may offer another form of ratepayer protection mechanism in the place of a hold harmless commitment, and that an applicant may not require any such mechanism in order to be able to demonstrate that a proposed transaction will not have an adverse effect on rates. The policies adopted in the policy statement will be effective 90 days after publication.