On June 29, 2018, FERC rejected proposals by Calpine Corporation (“Calpine”) and PJM Interconnection, L.L.C. (“PJM”) to address what they view as shortcomings in PJM’s capacity markets resulting from what they characterize as state subsidy programs that suppress capacity prices (the “June 29 Order”).  Continue Reading FERC Rejects PJM’s Proposed Tariff Revisions and Initiates Section 206 Proceeding

On June 21, 2018, FERC issued an order instituting several proceedings, pursuant to section 206 of the Federal Power Act, to examine the methodology utilized by certain public utilities for calculating Accumulated Deferred Income Tax (“ADIT”) balances in their projected test year and annual true-up calculations for their formula transmission rates. Continue Reading FERC to Review ADIT Methodology for Certain Public Utilities’ Formula Transmission Rates

On June 15, 2018, in separate opinions, the U.S. Court of Appeals for the District of Columbia Circuit (“D.C. Circuit”) affirmed two FERC rulings that denied utilities’ requests to be made whole for purchasing natural gas at inflated prices to comply with their PJM Interconnection, L.L.C. (“PJM”) capacity resource obligations during the 2014 Polar Vortex.  Specifically, the D.C. Circuit upheld FERC’s holdings that (1) permitting the utility in one case to recover costs retroactively would violate the filed rate doctrine and the rule prohibiting retroactive ratemaking and (2) the utility in the second case was not entitled to indemnification for its losses resulting from PJM requesting the utility to comply with its capacity resource obligations. Continue Reading D.C. Circuit Affirms Denial of Recovery of Gas Purchase Costs During 2014 Polar Vortex

On June 12, 2018, the Senate Energy and Natural Resources Committee hosted all five FERC Commissioners for an oversight hearing to discuss topics that included the agency’s approach to changes in the makeup of generating plants on the bulk power system and the efficiency of its energy infrastructure permitting processes. Continue Reading Senate Energy and Natural Resources Committee Holds Hearing on FERC Oversight

On May 31, 2018, CPV Power Holdings, L.P., Calpine Corporation, and Eastern Generation, LLC (together, “Complainants”) filed a complaint against PJM Interconnection, L.L.C. (“PJM”), contending that PJM’s Open Access Transmission Tariff (“Tariff”) does not prevent the suppression of prices in PJM’s Reliability Pricing Model (“RPM”) market by resources receiving state subsidies, and that the solutions that PJM had proposed to FERC—“Capacity Repricing” and “Minimum Offer Price Rule (“MOPR”)-Ex”—are “inadequate and unjust and unreasonable.”  The Complainants argued that FERC should instead require PJM to adopt a “Clean MOPR”—meaning a MOPR “applicable to all subsidized resources and without categorical exemptions like those in PJM’s MOPR-Ex proposal.” Continue Reading Complaint Proposes “Clean MOPR” as an Alternative to PJM’s Proposals to Address State Subsidies in Capacity Markets

On May 24, 2018, FERC denied a complaint filed by the New Jersey Board of Public Utilities (“NJBPU”) alleging unjust and unreasonable cost allocations for the Bergen-Linden Corridor transmission project (the “Project”) within the PJM Interconnection, L.L.C. (“PJM”) footprint.  FERC rejected NJBPU’s claims that, among other alleged problems, PJM’s implementation of certain provisions in its tariff and the Joint Operating Agreement (the “JOA”) with the New York Independent System Operator, Inc. (“NYISO”) unfairly insulated New York ratepayers from costs associated with the Project, at the expense of New Jersey ratepayers and in violation of FERC’s Order No. 1000.   Continue Reading FERC Denies NJBPU Complaint Regarding Bergen-Linden Corridor Project in PJM

On May 17, 2018, FERC affirmed an Initial Decision addressing a bandwidth calculation filing applicable to a seven-month period in 2005 filed by Entergy Services, Inc. on behalf of the Entergy Operating Companies (“Operating Companies”; collectively, “Entergy”) in November 2016.  Continue Reading FERC Affirms Initial Decision Regarding Entergy’s Bandwidth Calculation Filing

On May 4, 2018, FERC approved the joint petition filed by the North American Electric Reliability Corporation (“NERC”), Midwest Reliability Organization (“MRO”), and SERC Reliability Corporation (“SERC”) (collectively “Petitioners”) requesting FERC approvals for the dissolution of the Southwest Power Pool Regional Entity (“SPP RE”), and the transfer of the registered entities within the SPP RE footprint to MRO and SERC (“Joint Petition”). Continue Reading FERC Approves of SPP Regional Entity Dissolution and Registered Entity Transfer to SERC, MRO

On April 30, 2018, the Commission granted the California Independent System Operator Corporation’s (“CAISO”) request for a limited waiver of a specific section of CAISO’s Tariff to allow CAISO to: (1) process out-of-time annual recertifications for certain resources as “Acquired Resources” for the 2018 resource adequacy compliance year, and (2) provide certainty to those resources that their Resource Adequacy Availability Incentive Mechanism (“RAAIM”) exemption for the 2017 resource adequacy compliance year will not be unwound. Continue Reading FERC Grants CAISO Waiver for Acquired Resources in RAAIM