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The Commission recently issued two orders addressing controversial capacity market issues.  On April 12, 2011, the Commission approved a rate filing by PJM Interconnection, LLC (“PJM”) that will modify the minimum offer price rule (“MOPR”) to prevent what PJM called the threat of uneconomic entry of new generation (the “PJM Order”).  On April 13, 2011, the Commission addressed issues in connection with ISO-New England’s (“ISO-NE”) Forward Capacity Market (“FCM”) and ordered ISO-NE to develop an offer-floor mitigation “construct” similar to that of PJM and the New York Independent System Operator (“NYISO”) in order to deal with Out of Market (“OOM”) resources suppressing clearing prices below competitive levels (“ISO-NE Order”).

On April 8, 2011, the Midwest Independent System Operator, Inc. (“MISO”) filed a petition for Declaratory Order (“Petition”) from the Federal Energy Regulatory Commission (“FERC” or the “Commission”) that the terms of the Joint Operating Agreement (“JOA”) currently in effect between MISO and the Southwest Power Pool (“SPP”) concerning sharing of transmission capacity on a common path will remain applicable to Entergy Arkansas, Inc. (“Entergy”) if Entergy becomes a transmission-owning member of MISO.

On March 25, 2011, Mayor of New York Michael Bloomberg submitted a letter to Chairman Jon Wellinghoff of the Federal Energy Regulatory Commission (“FERC” or the “Commission”), urging the Commission to reconsider its January 28, 2011 Order in Docket No. ER11-2224 approving new capacity demand curves for the New York Independent System Operator, Inc. (“NYISO”).

On March 17, 2011, the Federal Energy Regulatory Commission (“FERC” or the “Commission”)  affirmed an original $80,000 North American Electric Reliability Corporation (“NERC”) proposed penalty against Turklock Irrigation District (“Turlock”) for an outage caused by vegetation management, specifically reviewing the Notice of Penalty (“NOP”) for FAC-003-1 R2 (see March 5, 2010 edition of the WER).

On March 10, 2011, FERC Chairman Jon Wellinghoff sent letters to Senators Joe Lieberman (I–CT) and Susan Collins (R–ME), the chair and ranking member of the Senate Committee on Homeland Security and Governmental Affairs, and to Representatives Darrell Issa (R–CA) and Elijah Cummings (D–MD), the chairman and ranking member of the House Committee on Oversight and Government Reform, detailing the actions taken by FERC in response to cybersecurity concerns and challenges to the smart grid system.