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On January 21, 2010, FERC issued a declaratory order that Western Grid Development LLC’s (“Western Grid”) battery storage devices (“Projects”) are wholesale transmission facilities subject to FERC jurisdiction.  FERC also granted Western Grid’s request for incentive rate treatment for the Projects.  However, FERC reiterated that since energy storage devices do not fit easily into the category of traditional generation, transmission, or distribution, FERC will assess storage devices on a case-by-case basis.

On January 22, 2010, the United States Court of Appeals for the D.C. Circuit (“DC Circuit”) remanded back to the Federal Energy Regulatory Commission (“FERC” or the “Commission”)  its final rule that adopted changes to the interstate natural gas pipeline reporting rules and financial reforms asserting that FERC failed to adequately respond to a dissenting commissioner in its order.

On January 21, 2010, FERC issued a Notice of Inquiry (“NOI”) seeking comments on existing barriers to integrating variable energy resources (“VERs”) into the electric grid and whether reforms are needed to remove those barriers.  FERC will use the comments to determine whether changes to wholesale electricity tariffs are necessary to ensure they are “just, reasonable and not unduly discriminatory.”

On January 22, 2010, FERC presiding Administrative Law Judge Carmen Cintron, issued an initial decision in its anti-manipulation case against Brian Hunter, finding that he engaged in fraudulent conduct and intended to lower the settlement price of natural gas futures contracts while he worked for Amaranth Advisors LLC (“Amaranth”) in violation of the Commission’s rule on anti-manipulation.

On January 21, 2010, the Federal Energy Regulatory Commission (“FERC” or the “Commission”) released a Notice of Proposed Rulemaking (“NOPR”) to allow for credit reforms in the organized wholesale electric markets.  Previously, most wholesale electric markets developed credit practices on a case-by-case basis, depending on individual needs.  Due to the current financial situation, some groups have become concerned that these varying credit practices would not be sufficient to protect the markets, and subsequently the consumers, from the high costs associated with credit risks and credit defaults.

On January 21, 2010, FERC issued a Notice of Inquiry (“NOI”) to look at whether or not to expand its Electric Quarterly Report (“EQR”) filing requirements to those entities excluded from FERC jurisdiction under section 205 of the Federal Power Act (“FPA”).  The NOI will aid FERC in deciding if changes should be made to section 220 of the FPA, as adopted in the Energy Policy Act of 2005(“EPAct 2005”).

On January 18, 2010, the Supreme Court of the United States (“Supreme Court”) denied a request for certiorari by Edison Electric Institute (“EEI”) of a United States Court of Appeals for the Fourth Circuit (“Court of Appeals”) decision which limited the backstop authority of FERC to instances where a state commission withheld approval of certain interstate electric transmission projects for more than 1 year after the filing of an application for a permit (see the February 20, 2009 edition of the WER).

On January 6, 2010, the FERC approved a request from American Electric Power Services Corporation (“AEP Services”), the wholly owned subsidiary of American Electric Power Company, Inc. (“AEP”), to transfer transmission assets to Electric Transmission Texas, LLC (“Electric Transmission Texas”) under section 203 of the Federal Power Act (“FPA”).