On March 17, 2020, FERC accepted revisions to the PJM Interconnection LLC (“PJM”) Open Access Transmission Tariff (“Tariff”) to establish enhanced procedures for compliance with the North American Electric Reliability Corporation (“NERC”) reliability standard CIP-024-2.  A majority of FERC Commissioners found that the Tariff revisions, captured in a new proposed Tariff Attachment M-4, appropriately balanced transparency obligations in transmission planning with the need to maintain strict confidentiality regarding the names, locations, and vulnerabilities of CIP-014-2 facilities.  In a separate opinion, Commissioner Glick dissented, in part, arguing that the proposal inappropriately categorized Attachment M-4 projects as a subset of “Supplemental Projects” under the Tariff and PJM Operating Agreement. Commissioner Glick argued that the proposal improperly subjected such projects to non-regional cost allocation, contrary to cost-causation and other transmission planning principles expressed in Commission Order Nos. 890 and 1000.

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I. Summary of NOPR

On March 19, 2020, the Federal Energy Regulatory Commission (FERC) issued a Notice of Proposed Rulemaking (NOPR) proposing to revise its electric transmission incentive policy under Federal Power Act (FPA) Section 219[1] “to stimulate the development of transmission infrastructure needed to support the nation’s evolving generation resource mix, technological innovation

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 March 4, 2020, FERC denied rehearing of its prior order rejecting the New Jersey Board of Public Utilities’ (“NJBPU”) complaint alleging unjust and unreasonable cost allocations for the Bergen-Linden Corridor transmission project (“BLC Project”). FERC found that it had already fully addressed the issues raised in the original complaint and that there was no need for an evidentiary hearing to evaluate disputed facts related to the BLC Project.
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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 January 31, 2020, FERC rejected Southwest Power Pool, Inc.’s (“SPP”) proposed Tariff revisions to eliminate SPP’s current policy of offering transmission revenue credits as reimbursement for certain transmission network upgrades, and to instead provide term- and value-limited transmission congestion rights for all such upgrades. Under SPP’s proposal, a party that funds certain network upgrades would receive incremental transmission congestion rights for a limited term of up to twenty years or until the party that sponsored the upgrade recovered their costs, with interest. FERC held that this cap on recovery would disincentivize construction of merchant transmission projects, and rejected SPP’s proposal without prejudice to SPP submitting a revised proposal that does not impose a cap on the term and value of the incremental transmission congestion rights.
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On January 24, 2020, FERC issued its rehearing order on several different issues regarding the recovery of costs associated with the abandoned Potomac-Appalachian Transmission Highline Project (“PATH”). Previously, in January 2017, FERC reduced PATH’s return on equity (“ROE”) during its abandonment phase from 10.4 to 8.11 percent, and denied PATH’s recovery of expenditures related to certain public relations activities. On rehearing, FERC:

  1. Upheld its prior determination that the project’s abandonment significantly reduced its risk profile;
  2. Declined to address PATH’s arguments that FERC erred in reducing its ROE to 8.11 percent, and instead established a paper hearing addressing whether and how FERC’s proposed revised base ROE methodology should apply; and
  3. Reversed its prior denial for PATH to recover expenditures related to public information campaigns about the benefits and licensing of the project.
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On January 10, 2020, FERC issued two separate orders approving Stipulation and Consent Agreements (“Agreements”) between the Office of Enforcement (“Enforcement”) and Emera Energy Incorporated (“Emera Energy”) and Exelon Generation Company, LLC (“Exelon”), respectively. Both Agreements relate to alleged violations of ISO New England Inc.’s (“ISO-NE”) Tariff. Specifically, with respect to Emera Energy, FERC alleged that Emera Energy violated the Tariff’s requirement that evidence supporting Fuel Price Adjustment Requests (“FPA Requests”) must reflect an arm’s length transaction. With respect to Exelon, FERC alleged that Exelon misreported the type and quantity of start-up fuel used by its Mystic 7 generating unit (“Mystic 7”). In both cases, FERC found that the Agreements were in the public interest and the Enforcement investigations were resolved on fair and equitable terms.

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On December 20, 2019, the U.S. Court of Appeals for the D.C. Circuit (“D.C. Circuit”) denied petitions for review of a series of FERC orders that exempted certain North Carolina transmission customers of Virginia Electric and Power Company (“Dominion”) from the incremental costs to underground certain transmission lines in the Virginia portion of the Dominion’s service territory.  The challenges were brought by certain Virginia transmission customers of Dominion Energy, which sought to overturn FERC’s determination that only Dominion’s Virginia wholesale customers, not its North Carolina customers, should bear the costs of undergrounding three transmission line upgrade projects.
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On December 10, 2019 FERC accepted ISO New England Inc.’s (“ISO-NE”) proposed revisions to its Tariff to enhance the competitive transmission solicitation process and make additional improvements to ISO-NE’s transmission planning process (“Transmission Planning Improvements”). ISO-NE’s proposal was joined by New England Power Pool Participants Committee and the Participating Transmission Owners Administrative Committee (collectively, “Filing Parties”). The Filing Parties’ Transmission Planning Improvements went into effect on December 10, 2019.

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