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On August 20, 2010, the Federal Energy Regulatory Commission (“FERC” or the “Commission”) approved an audit report on the Western Electricity Coordinating Council (“WECC”), and in that order, FERC directed WECC to make organizational changes that will separate certain operational functions from the functions of overseeing regional reliability standards. 

On August 27, 2010, the Commission issued a Notice of No Further Review and Guidance Order (the “Order”) regarding one Notice of Penalty against Commonwealth Edison Company (“ComEd”).  The Commission addressed the question “whether repetitive infractions of the same or a closely-related Reliability Standard requirement are treated as an aggravating factor in penalty determinations.”

On August 30, 2010, FERC issued an order clarifying the state netting policies for station power.  The order was on remand from two orders from the United States Court of Appeals for the DC Circuit (“DC Circuit”).   In the FERC order on remand, the Commission said it will not encroach upon a state’s right to establish netting periods for station power; thus, for retail calculations, states do not have to adopt the same methodology that FERC uses for calculating station power sold in interstate commerce.

Beginning in July of this year, PJM noticed that some of its market participants appeared to be taking unfair advantage of certain of its power market settlement rules.  These rules permit non-firm transmission customers to receive an allocation of the PJM marginal losses surplus which exceeds such participants’ cost of transmission service.  FERC has announced that it will conduct a non-public, formal investigation – with subpoena power – to determine whether this behavior constitutes unlawful market manipulation.  This investigation will have an obvious and direct impact on PJM market participants because FERC’s Office of Enforcement will move swiftly to collect information and undertake its investigation in earnest. 

On July 15, 2010, the Midwest Independent Transmission System Operator, Inc. (“Midwest ISO”) submitted to the Federal Energy Regulatory Commission (“FERC” or the “Commission”) a new proposal to allocate the costs of new transmission projects.  Notably, the proposal asks for the creation of a new category of projects, the Multi Value Projects (“MVPs”) category, and widely socialized costs for such projects across the entire Midwest ISO footprint. 

On July 15, 2010, FERC ruled that sections of the Federal Power Act (“FPA”) and the Public Utility Regulatory Policies Act of 1978 (“PURPA”) do not preempt the California Public Utilities Commission’s (“CPUC”) decision to require utilities to offer a minimum price for power from certain small combined heat and power (“CHP”) generators if they are Qualifying Facilities (“QF”) under PURPA.  

In a July 23, 2010 opinion, the United States Court of Appeals for the D.C. Circuit (“D.C. Circuit”) denied several appeals regarding the Calfornia Independent System Operator Corporation’s (“CA ISO”) Market Redesign and Technology Upgrade (“MRTU”) initiative, in which the CA ISO overhauled its tariff, markets and the technology it employs to administer those markets. 

On July 15, 2010, the Federal Energy Regulatory Commission (“FERC” or the “Commission”) conditionally approved the Southwest Power Pool, Inc’s (“SPP”) modified transmission planning process, the Integrated Transmission Plan (“ITP”).   The ITP will be used to determine future regional transmission needs.