In an unpublished opinion issued May 12, 2017, a three-judge panel on the U.S. Court of Appeals for the Ninth Circuit (“Ninth Circuit”) affirmed the dismissal of a civil suit alleging that a JPMorgan Chase & Co. subsidiary—J.P. Morgan Ventures Energy Corporation (“JPM Ventures”)—fraudulently manipulated rates in the California wholesale electricity market in violation of the Racketeer Influenced and Corrupt Organizations Act (“RICO”). Continue Reading Ninth Circuit Dismisses RICO Class Action Against Power Marketer on Filed-Rate Doctrine Grounds

On May 12, 2017, PJM Interconnection, L.L.C. (“PJM”) submitted to FERC revisions to the PJM Open Access Transmission Tariff (“OATT”), Attachment K-Appendix and the PJM Amended and Restated Operating Agreement, Schedule 1 to implement changes to the Operating Reserve demand curves (“ORDC”) that are embedded in PJM’s real-time market clearing engines.  According to PJM, the proposed changes to the ORDC are necessary to set clearing prices relative to the degree of severity of a reserve shortage. Continue Reading PJM Proposes Changes to Operating Reserve Demand Curves to Reduce Reserve Shortage Pricing

On May 18, 2017, ISO New England Inc. (“ISO-NE”) and the New England Power Pool Participants Committee (together with ISO-NE, the “Filing Parties”) proposed revisions to the ISO-NE/New York Independent System Operator, Inc. (“NYISO”) Coordination Agreement (the “NE/NY Coordination Agreement”) and the term sheet indicating the price of emergency energy sold to Hydro-Quebec Transenergie (“HQTE”) by ISO-NE (the “HQTE EE Pricing Schedule”) to reflect changes that were implemented to ISO-NE’s Market Rule regarding emergency energy purchases and sales.  The NE/NY Coordination Agreement specifies, among other things, the terms and conditions under which a control area will provide energy to the neighboring control area during emergency conditions.  These terms and conditions include the price one control area will charge the other for providing emergency energy.  Continue Reading ISO-NE Proposes Modifications to Pricing for Sales of Emergency Energy to NYISO, Hydro Quebec

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 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

On April 14, 2017, Renewable Energy Systems Americas (“RES) and Invenergy Storage Development LLC (“Invenergy”) (collectively, the “Complainants”) filed a complaint with FERC against PJM Interconnection, L.L.C. (“PJM”), alleging that changes PJM made to a dispatch signal used in its Regulation market were unjust, unreasonable, and unduly discriminatory, and therefore in violation of the Federal Power Act (“FPA”) and FERC precedent. Continue Reading RES and Invenergy Allege PJM’s Change to Regulation Market Dispatch Signal Harms Storage Resources

On April 20, 2017, staff from the ISO New England Inc. (“ISO-NE”), presented a proposal to its ten-member Board of Directors on how to better incorporate state-subsidized new resources into ISO-NE’s Forward Capacity Market (“FCM”).  The proposal contemplates a two-stage process whereby retiring resources that clear the annual Forward Capacity Auction (“FCA”) can transfer their capacity obligations to state-subsidized generators in exchange for payment and permanent retirement.  If approved by the Board of Directors, stakeholder discussions could begin in May, with associated tariff revisions filed with FERC in December. Continue Reading ISO-NE Staff Kicks off Consideration of Capacity Market Reforms to Manage State-Subsidized Generators