On May 9, 2017, the New Jersey Boroughs of Milltown, Park Ridge, and South River (collectively, “New Jersey Boroughs”) filed a Federal Power Act (“FPA”) Section 206 complaint against Public Service Electric & Gas Company (“PSE&G”) seeking to reduce PSE&G’s current base return on equity (“ROE”) of 11.18 percent to a base ROE of no higher than 8.3 percent.  Additionally, the New Jersey Boroughs requested that FERC order refunds and establish the date of the complaint as the refund effective date.

Continue Reading New Jersey Boroughs Request that FERC Reduce PSE&G’s Base ROE from 11.18 Percent to 8.3 Percent

On May 8, 2017, the nation’s Regional Transmission Organizations and Independent System Operators (“RTOs/ISOs”) submitted their respective compliance filings to implement the directives from FERC Order No. 831, which revised FERC’s regulations regarding incremental energy offer caps imposed by RTOs/ISOs. Continue Reading RTOs/ISOs Submit Order No. 831 Compliance Filings

On May 10, 2017, FERC issued notice that FERC staff will convene a technical conference on June 29, 2017 on natural gas index liquidity and transparency.  Specifically, the purpose of the technical conference is to (1) understand the state of liquidity in physical natural gas markets; (2) explore trends in physical gas trading and price reporting and how the use of natural gas indices have evolved over time; (3) obtain industry views on the confidence in natural gas indices and price formation; and (4) consider whether there is a need to improve natural gas market liquidity and price reporting and, if so, how. Continue Reading FERC to Convene Technical Conference on Natural Gas Index Liquidity and Transparency

President Donald Trump will nominate Neil Chatterjee and Robert Powelson as FERC Commissioners, the White House announced on Monday.

Chatterjee has been the energy policy adviser to U.S. Senate Majority Leader Mitch McConnell since 2012.  Prior to that, Chatterjee worked as a lobbyist for the National Rural Electric Cooperative Association.  Powelson has served as a Commissioner of the Pennsylvania Public Utilities Commission (“Pennsylvania PUC”) since 2008 and was Chairman of the Pennsylvania PUC for four years.  Powelson is also currently serving a one-year term as president of the National Association of Regulatory Utility Commissioners.

If Chatterjee and Powelson are confirmed by the U.S. Senate and sworn in, FERC will no longer be without a quorum (see February 21, 2017 edition of the WER).

A copy of the White House’s announcement may be found here.

On April 28, 2017, Commissioner Colette Honorable announced that she will not pursue another term as a Commissioner at FERC after her current term expires June 30, 2017.  Commissioner Honorable is serving her first term with the Commission.  After she was appointed by President Obama, she was confirmed by the U.S. Senate on December 16, 2014 (see December 19, 2014 edition of the WER).  Prior to joining FERC, Commissioner Honorable was the Chairman of the Arkansas Public Service Commission and also was president of the National Association of Regulatory Utility Commissioners.  Continue Reading Commissioner Honorable Announces She Will Not Pursue Another Term

On May 1, 2017, FERC filed a brief in the United States Court of Appeals for the District of Columbia Circuit (“D.C. Circuit”) arguing for the dismissal of United Airlines Inc. and UPS Fuel Services Inc’s (together, “Shippers”) petition for review of a 2013 FERC order in which FERC allowed Enterprise TE Products Pipeline Company LLC (“Pipeline”) to discontinue its jet fuel and diesel fuel transportation service to various shipping entities, including Shippers.  Shippers’ petition for review alleged that Pipeline’s termination of this service violated a 2013 settlement agreement (“Settlement Agreement”) requiring Pipeline to provide this service through May 31, 2015.  FERC’s brief argued that the petition should be dismissed for lack of justiciability, or in the alternative, for lack of standing.

Continue Reading FERC Seeks Dismissal of Jet Fuel and Diesel Fuel Shippers’ Petition for Review in D.C. Circuit Court of Appeals

On May 1-2, 2017, FERC staff held a technical conference on wholesale energy and capacity market design, focused on markets operated by ISO New England Inc. (“ISO-NE”), New York Independent System Operator, Inc. (“NYISO”), and PJM Interconnection, L.L.C. (“PJM”) (collectively, “Eastern RTOs and ISOs”).  The goal of the conference was to explore the balance between FERC’s regulation of these competitive wholesale markets and recent efforts by states to ensure that certain categories of generating resources receive sufficient revenue to continue operating.  Stakeholders from various sectors of the electricity industry attended to express concern that these eastern organized markets require regulatory intervention of some sort—with a regulatory response from FERC unlikely to take place until at least a three-Commissioner quorum is established. Continue Reading FERC Holds Technical Conference to Explore Fundamental Design Issues in Eastern Organized Markets

On April 21, 2017, the United States Court of Appeals for the Ninth Circuit (“Ninth Circuit”) held that: (1) FERC did not act arbitrarily or capriciously in ordering the California Independent System Operator Corporation (“CAISO”) and California Power Exchange Corporation (“Cal-PX”) to net sales and purchases over hourly intervals when calculating refunds to entities that participated in the CAISO and Cal-PX markets during the California energy crisis of 2000-2001; and (2) that FERC did act arbitrarily and capriciously in allocating a $5 million refund shortfall only to net buyers instead of all market participants.  The Ninth Circuit opinion is the latest adjudicatory decision in a series of administrative hearings and judicial appeals arising out of the California energy crisis.

Continue Reading Ninth Circuit Upholds FERC’s Hourly Netting Refund Methodology, but Overturns FERC’s Treatment of $5 Million Refund Deficit Related to California Energy Crisis

On April 24, 2017, PJM Interconnection, L.L.C. (“PJM”) submitted an amicus curiae brief in a legal challenge against an Illinois program to provide additional revenue for some of the state’s financially-struggling nuclear energy facilities.  The program allows eligible generators to generate and sell Zero Emission Credits (“ZECs”) and obligates the state’s utilities to buy a certain share of those credits.  In its brief, PJM argued that the program allows uneconomic generators to continue participating in wholesale energy and capacity markets, thereby causing “substantial[] harm” to the markets and other participating generators. Continue Reading PJM Files Amicus Brief Opposing Illinois ZEC Program in Federal District Court Challenge

On April 21, 2017, the California Independent System Operator Corporation (“CAISO”) requested that FERC find CAISO’s current tariff just and reasonable, and that CAISO no longer needed to implement several outstanding directives that were issued in a 2006 order conditionally approving CAISO’s Market Redesign and Technology Upgrade (“MRTU”) tariff amendments, which were designed to, among other things, implement a nodal market in the CAISO footprint. Continue Reading CAISO Requests Removal of Remaining MRTU Directives