On March 15, 2011, the Commission issued Order No. 745, “Demand Response Compensation in Organized Wholesale Energy Markets” (“Order No. 745” or the “Final Rule”). Order No. 745 required that organized wholesale energy markets administered by a Regional Transmission Organization (“RTO”) or Independent System Operator (“ISO”) compensate demand response resources at the market price for energy, or locational marginal price (“LMP”), if the demand resource is able to displace a generation resource in an RTO/ISO effort to balance supply and demand and when proscribed by a new “net benefits test.”
FERC News
Chairman Wellinghoff Responds to Senator’s Letter on Transmission Costs
On March 14, 2010, Chairman Wellinghoff responded to a February 2011 letter from senators Bob Corker (R-Tenn.), Ron Wyden (D-Ore.), and Richard Burr (R-N.C.) (collectively the “senators”) who expressed concern that the forthcoming Final Rule stemming from the rulemaking on Transmission Planning and Cost Allocation (see June 18, 2010 edition of the WER) will make customers who receive little or no benefit from a transmission project pay for a majority of the project.
FERC Acts On Dispatchable Intermittent Resources Within MISO
On February 28, 2011, the Federal Energy Regulatory Commission (“FERC” or the “Commission”) conditionally accepted in part updates to the Midwest Independent Transmission System Operator, Inc.’s (“Midwest ISO”) Open Access Transmission, Energy, and Operating Reserve Markets Tariff (“tariff”) that created a new category of resources named Dispatchable Intermittent Resources. This new category will allow wind to be treated like other power resources and participate in the region’s real-time energy market.
FERC Rejects Reserve Services Plan by WSPP
On March 4, 2011, FERC rejected two new Service Schedules proposed by the Western System Power Pool (“WSPP”) for incorporation into the WSPP Agreement.
Complaint Alleges PJM Failed to Conduct FTR Auctions Properly
On March 2, 2011, PPL EnergyPlus, LLC (“PPL EnergyPlus”) filed a complaint at the Federal Energy Regulatory Commission (“FERC” or the “Commission”) alleging that PJM Interconnection, L.L.C. (“PJM”) failed to conduct its annual financial transmission rights (“FTR”) auctions and auction revenue rights (“ARR”) allocations according to the PJM Open Access Transmission Tariff (“OATT”).
FERC to Hold Technical Conference on Priority Rights to New Participant-Funded Transmission
On March 15, 2011 from 9:30 am to 4:00 pm, the Federal Energy Regulatory Commission (“FERC” or the “Commission”) staff will hold a technical conference (the “Conference”) to consider issues related to “ownership of and priority access rights to new transmission projects.”
FERC General Counsel Submits Comments to CFTC
On February 22, 2011, Michael Bardee, General Counsel for FERC, submitted comments in response to the Commodity Futures Trading Commission’s (“CFTC”) Notice of Proposed Rulemaking (“NOPR”) on the elective exception to mandatory clearing for swaps under the Commodity Exchange Act (“CEA”).
FERC Issues an Order to Show Cause for Violation of Market Behavior Rules
On February 14, 2011, FERC issued an order to show cause (the “Order”) to Moussa I. Kourouma, d/b/a Quntum Energy LLM (“Quntum”) for alleged violations of the Commission’s regulations.
FERC Issues NOPR on Regulation Service & NOI on Locational Exchanges
At the February 17, 2011 meeting, FERC issued a Notice of Proposed Rulemaking (“NOPR”) on compensation for regulation service and a Notice of Inquiry (“NOI”) seeking comment on locational exchanges for wholesale power.
FERC Initiates Inquiry into Outages and Disruptions in Texas and the Southwest
On February 14, 2011, FERC issued an order directing staff to initiate an inquiry into outages and disruptions of service in Texas and the Southwest in early February 2011 (the “Order”).