On March 20, 2020, FERC denied rehearing of a February 2018 order accepting the Midcontinent Independent System Operator, Inc.’s (“MISO”) resource adequacy Tariff provisions (see March 5, 2018 edition of the WER). FERC noted that many of the arguments raised on rehearing sought to impose on MISO the rules and requirements used in the centralized capacity markets in the eastern Regional Transmission Organizations/Independent System Operators (“RTOs/ISOs”). FERC rejected those arguments, concluding that unlike the centralized capacity constructs used in the eastern RTOs/ISOs, MISO’s capacity auction is not, and never has been, the primary mechanism for Load-Serving Entities (“LSEs”) to procure capacity.
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On March 10, 2020, FERC granted rehearing of its November 9, 2018 order that accepted revisions to ISO New England Inc.’s (“ISO-NE”) Tariff modifying the calculation of the economic life of existing capacity resources seeking to retire or permanently leave the ISO-NE capacity market, to better reflect competitive market behavior. FERC determined the benefits of the Tariff revisions did not outweigh the disruption to capacity market participants’ settled expectations and, therefore rejected the economic life revisions in their entirety, effective August 10, 2018, and declined to rerun any Forward Capacity Auctions (“FCA”) to preserve market certainty.  
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On March 10, 2020, FERC accepted and suspended Midcontinent Independent System Operator, Inc.’s (“MISO”) proposal to allow for the selection of a storage facility as a transmission-only asset (“SATOA”) in the MISO Transmission Expansion Plan (“MTEP”). FERC found that MISO failed to demonstrate that the proposal was just and reasonable and not unduly discriminatory, and directed staff to convene a technical conference to explore issues including:

  1. Evaluation and selection criteria for a SATOA in the MTEP;
  2. Permitted market activities for SATOAs and potential wholesale market impacts;
  3. How MISO’s current formula rate structure accommodates cost recovery for SATOAs;
  4. A SATOA’s potential impact on MISO’s generator interconnection queue; and
  5. Operating guidelines that will apply to a SATOA.


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On February 27, 2020, FERC granted Southwest Power Pool, Inc.’s (“SPP”) request to further delay implementation of reforms designed to facilitate energy storage resource (“ESR”) participation in SPP’s markets. SPP requested the deferral in December 2019, explaining that it would not be able to implement its ESR participation model as scheduled due to ongoing delays in the development of a new market and transmission settlement system and software changes associated with FERC’s Order No. 841 reforms. FERC accepted SPP’s deferral request and ordered a new, August 5, 2021 effective date for SPP’s underlying Order No. 841 tariff changes. Commissioner Bernard McNamee issued a separate opinion concurring with FERC’s order.
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On February 28, 2020, FERC rejected Midcontinent Independent System Operator, Inc.’s (“MISO”) Tariff proposal to subject generation resources that are not designated as capacity resources (“Non-Capacity Resources”) to MISO’s physical withholding rules in MISO’s day-ahead market. FERC determined that MISO’s proposed revisions lacked sufficient clarity and would effectively subject Non-Capacity Resources to a must-offer rule obligation without a corresponding capacity payment.
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On February 21, 2020, FERC issued an order accepting ISO New England Inc.’s (“ISO-NE”) November 5, 2019 informational filing about the parameters of its fourteenth Forward Capacity Auction (“FCA 14”) for the 2023-24 Capacity Commitment Period (“Informational Filing”).  In so doing, FERC rejected arguments from ISO-NE’s External Market Monitor and others that ISO-NE over-mitigated the bids of various energy storage resources by relying on improper assumptions and historical data. FERC’s order sparked a dissent from Commissioner Richard Glick.

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On February 27, 2020, FERC accepted a compliance filing from PJM Interconnection, L.L.C. (“PJM”) that proposed identical revisions to Attachment K of the PJM Tariff and Schedule 1 of the PJM Operating Agreement, finding that the revisions met the requirements of Opinion No. 566, issued August 26, 2019. In accepting PJM’s compliance filing, FERC found that the PJM Tariff now includes greater transparency regarding the process used to evaluate requests to build network upgrades in order to obtain Incremental Auction Revenue Rights (“IARRs”).
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On February 20, 2020, FERC issued four separate orders with significant impacts on renewable and storage resources under the New York Independent System Operator, Inc.’s (“NYISO”) buyer-side mitigation (“BSM”) rules (collectively, “February 20 Orders”). BSM rules serve some of the same purposes as PJM’s Minimum Offer Price Rule or “MOPR.” While the orders explicitly limit or reject proposed renewable and storage exemptions, the orders are equally important for what they do not do. Focused on the cases and records before it, FERC declined to extend BSM to apply outside of the so-called Mitigated Capacity Zones or “MCZs” (New York City, or Zone J, and the Lower Hudson Valley, or Zones G through J). Consequently, BSM still does NOT apply to any units, including renewable, storage or nuclear units, outside of these MCZs. FERC also directed NYISO to better tailor a renewable exemption specific to the MCZs. The extent to which this will help the new development of offshore wind in New York remains to be seen.  In dissenting opinions, Commissioner Richard Glick argued, among other things, that the majority’s overall approach to BSM will protect incumbent generators while impeding state clean energy policies.
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On February 5, 2020, FERC denied a request from demand-side energy management company Enerwise Global Technologies, Inc. d/b/a CPower (“CPower”) for a one-time waiver of ISO New England, Inc’s (“ISO-NE”) Market Rule 1 in order to permit CPower’s summer-only demand capacity distributed generation resources, for which it elected Renewable Technology Resource (“RTR”) treatment, to participate in ISO-NE’s fourteenth Forward Capacity Auction (“FCA 14”) and the substitution auction. CPower presented two alternative options for waiver, arguing that an unintended interaction between ISO-NE’s RTR and “composite offer” Tariff provisions caused its resources to be excluded from FCA 14 and the substitution auction. FERC denied CPower’s request, even though ISO-NE supported one of the alternatives that CPower presented. Commissioner Richard Glick dissented in part, explaining that he also would have granted one of CPower’s proffered waiver options.
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On February 3, 2020, FERC denied a waiver request filed by Genbright LLC (“Genbright”) seeking a one-time limited waiver of Market Rule 1 in the ISO New England Inc. (“ISO-NE”) Transmission, Markets and Services Tariff (“Tariff”) to allow fourteen distributed energy resource projects (the “DER Projects”) to participate in the fourteenth ISO-NE Forward Capacity Auction (“FCA 14”).  According to Genbright, the DER Projects did not qualify to participate in this year’s capacity auction because Genbright sought interconnection under a state-administered interconnection process rather than the FERC jurisdictional interconnection options specified in the ISO-NE Tariff, and Genbright argued that the interconnected utility should have alerted Genbright of the FERC-jurisdictional status of its interconnections.  In denying the request, FERC found that granting waiver would inappropriately allow Genbright to avoid ISO-NE’s complex interconnection study process.
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