On October 9, 2013, FERC filed a petition (“Petition”) in the United States District Court for the Eastern District of California for an order affirming FERC’s assessment of civil penalties totaling $435 million against Barclays Bank PLC (“Barclays”) and four of its traders for manipulating electricity markets in and around California, along with disgorgement of profits in the amount of $34.9 million.
FERC News
FERC Orders Technical Conference on PJM’s Proposed Demand Resource Offer Changes
On October 1, 2013, FERC accepted and suspended PJM Interconnection, LLC’s (“PJM”) demand resource offer revisions to its Open Access Transmission Tariff (“OATT”) and Reliability Assurance Agreement, and set the matter for a technical conference. FERC stated that the technical conference will explore issues raised in the proceeding that warrant further discussion.
Ron Binz Withdraws Name from Consideration for Appointment as FERC Chairman
On Tuesday, October 1, 2013, former Colorado utilities regulator Ron Binz issued a press release stating that he had requested that his name be withdrawn from further consideration as President Barack Obama’s nominee for FERC commissioner.
FERC Approves Modifications to Four Reliability Standards
On September 19, 2013, FERC issued a final rule approving the North American Electric Reliability Corporation’s (“NERC”) modifications to four requirements for electricity reliability. The modifications were proposed to close perceived reliability gaps associated with generator interconnection facilities without the need for most generator owners or operators to register as transmission owners or operators.
QF Owner Asks FERC to Stop Idaho PUC from Allocating RECs to Utility
On September 20, 2013, Clearwater Paper Corporation (“Clearwater”) filed with FERC a petition for enforcement pursuant to section 210(H) of the Public Utility Regulatory Policies Act of 1978 (“PURPA”) against the Idaho Public Utilities Commission (“Idaho PUC”). The petition alleges that the Idaho PUC impermissibly moved to allocate, without compensation to a Qualifying Facility (“QF”), one half of all Renewable Energy Credits (“RECs”) created through that facility’s PURPA QF contracts within Idaho to the utility purchasing the QF’s power under a PURPA contract.
FERC Issues Order No. 764-B Clarifying Variable Energy Resource Integration Rule
On September 19, 2013, FERC issued Order No. 764-B, further clarifying its Integration of Variable Energy Resources (“VER”) rule originally established in Order No. 764. Powerex Corporation (“Powerex”) and Iberdrola Renewables, LLC (“Iberdrola Renewables”) had sought clarification, or in the alternative rehearing, of issues related to e-Tagging and the Bonneville Power Administration’s (“Bonneville”) practice of curtailments pursuant to its Dispatcher Standing Order (“DSO”) 216 protocol.
FERC Clarifies that the “Last-in, First-out” Curtailment Methodology is Discriminatory for All Classes of Transmission Service
On September 12, 2013, FERC issued an order (“September 12 Order”) granting in part and denying in part requests for clarification filed by Puget Sound Energy, Inc. (“Puget”) and Powerex Corporation (“Powerex”) of a May 20, 2013 order (“May 20 Order”) accepting for filing certain non-conforming service agreements for conditional firm point-to-point transmission service executed between Puget and Morgan Stanley Capital Group, Inc. (“Morgan Stanley”).
FERC Grants eBay Inc. Market-Based Rate Authority
On Thursday, September 5, 2013, FERC granted eBay Inc. (“eBay”) market-based rate authority, effective August 26, 2013. eBay is developing an approximately 6 MW fuel cell generation facility at its South Jordan, Utah data center. While the facility will primarily be used to provide onsite power for the data center, eBay sought blanket authority to sell any excess energy that is produced.
FERC Approves Revisions to CIP Standards Exemption Process
On September 3, 2013, FERC approved proposed revisions by the North American Electric Reliability Corporation (“NERC”) to simplify its process for exempting companies from compliance with Critical Infrastructure Protection (“CIP”) reliability standards. According to NERC, the new process will operate more efficiently by streamlining the processes for submission, review, acceptance or rejection, and modification of previously accepted Technical Feasibility Exceptions (“TFE”).
FERC Issues Three Civil Penalties Regarding Manipulation of ISO-NE’s Demand Response Program
On Monday, August 29, 2013 FERC issued three civil penalty orders after concluding that three separate entities manipulated ISO New England, Inc.’s (“ISO-NE”) Day-Ahead Load Response Program (“DALRP”). Specifically, FERC found that Lincoln Paper and Tissue, LLC (“Lincoln”), Competitive Energy Service, LLC (“CES”), and CES’s managing member Dr. Richard Silkman (“Silkman”) each violated FERC’s Prohibition on Market Manipulation by creating phantom load reductions in order to defraud ISO-NE of demand response payments.