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Forty years after enactment: How will PURPA evolve?May 3, 2019

The Public Utility Regulatory Policies Act of 1978 (PURPA) was enacted Nov. 9, 1978, to promote energy conservation (reduce demand) and promote greater use (increase supply) of domestic energy and renewable energy resources in response to the 1973 energy crisis. Much has changed in the last 40 years, including the evolution of organized wholesale electricity markets and policies that promote competition through open access transmission service. Incentives, such as the federal investment and pro­duction tax credits, and mandates, such as renewable portfolio standards, have stimulated development of
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FERC to Explore Policy Changes on Transmission Rate Incentives and Base ROEMarch 25, 2019

Co-authored By Andrea Sarmentero Garzón, Jennings Strouss
FERC issued two Notices of Inquiry (NOIs) at its March 21, 2019 open meeting. The NOIs address transmission rate incentives policy (Docket No. PL19-3) and base return on equity (ROE) policy (Docket No. PL19-4).
The incentives NOI examines, among other things, the objectives and need for all existing transmission incentives and the Commission’s approach to granting those incentives. This initiative follows complaints about the need for reconsidering the justness, reasonableness, and effectiveness of transmission rate
Continue Reading FERC to Explore Policy Changes on Transmission Rate Incentives and Base ROE

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Fourth Circuit Vacates National Park Service Right-of-Way Permit for Atlantic Coast Pipeline ProjectAugust 8, 2018

In another blow to construction of the 600-mile Atlantic Coast Pipeline (ACP), certificated by the Federal Energy Regulatory Commission (FERC) on October 13, 2017, the Fourth Circuit Court of Appeals on August 6: (1) vacated as arbitrary and capricious the National Park Service’s (NPS’s) right-of-way permit that would have allowed the project sponsors to drill and pass under the Blue Ridge Parkway, and (2) affirmed its prior decision that the Incidental Take Statement (ITS) issued by the U.S. Fish & Wildlife Service (FWS)
Continue Reading Fourth Circuit Vacates National Park Service Right-of-Way Permit for Atlantic Coast Pipeline Project

Energy
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Fourth Circuit Vacates National Park Service Right-of-Way Permit for Atlantic Coast Pipeline ProjectAugust 8, 2018

In another blow to construction of the 600-mile Atlantic Coast Pipeline (ACP), certificated by the Federal Energy Regulatory Commission (FERC) on October 13, 2017, the Fourth Circuit Court of Appeals on August 6: (1) vacated as arbitrary and capricious the National Park Service’s (NPS’s) right-of-way permit that would have allowed the project sponsors to drill and pass under the Blue Ridge Parkway, and (2) affirmed its prior decision that the Incidental Take Statement (ITS) issued by the U.S. Fish & Wildlife Service (FWS)
Continue Reading Fourth Circuit Vacates National Park Service Right-of-Way Permit for Atlantic Coast Pipeline Project

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FERC To Expand PJM’s Minimum Offer Price Rule to All Planned and Existing Resources – A Battle To Preserve States Jurisdiction Over Generation Facilities and to Carve Out Appropriate Exemptions EnsuesJuly 3, 2018

Co-authored by Andrea I. Sarmentero Garzón
On June 29, 2018, FERC issued an order rejecting two proposals (i.e., the Capacity Repricing and the MOPR-Ex proposals) filed by PJM Interconnection, L.L.C. (“PJM”) to address subsidization of resources in its capacity markets (Docket No. ER18-1314). The FERC order also granted in part a complaint filed by Calpine Corporation and others challenging PJM’s minimum offer price
Continue Reading FERC To Expand PJM’s Minimum Offer Price Rule to All Planned and Existing Resources – A Battle To Preserve States Jurisdiction Over Generation Facilities and to Carve Out Appropriate Exemptions Ensues

Energy
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FERC Initiates Review of Its Long-Standing Pipeline Certificate Policy StatementApril 24, 2018

Last Thursday, the Federal Energy Regulatory Commission (“FERC” or “Commission”) issued a Notice of Inquiry (“NOI”) seeking comment on possible changes needed to its 1999 Policy Statement on certification of new interstate pipelines. The NOI notes the almost two decades since the 1999 Policy Statement was approved and acknowledges that the Commission may have to reconsider how it balances project benefits against adverse consequences in light of the shale gas revolution, technological changes, global warming, and other environmental concerns, as well as increasing concerns raised by
Continue Reading FERC Initiates Review of Its Long-Standing Pipeline Certificate Policy Statement

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FERC Issues Orders in Cases Involving Rates for Transmission Service, Wholesale Power Rates, and Competition in RTO MarketsApril 6, 2018

The following are summaries of recent orders issued by FERC in four proceedings in which Jennings Strouss was involved.  The proceedings involve rates for transmission service, wholesale power rates, and competition in RTO markets.  The Commission denied a request for a transmission rate incentive, granted a complaint that alleged improper costs were included in a wholesale power formula rate calculation, ordered a technical conference to address seasonal resource participation in PJM Interconnection, L.L.C.’s (PJM) capacity market, and rejected
Continue Reading FERC Issues Orders in Cases Involving Rates for Transmission Service, Wholesale Power Rates, and Competition in RTO Markets

Energy
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Issue of Coordination with Affected Systems Rises to Forefront at FERCMarch 12, 2018

Practice Area: Energy

The issue of coordination with Affected Systems has long been a proverbial “elephant in the room” when generation project developers request interconnection service from a Transmission Provider and the interconnection may impact neighboring systems. The Federal Energy Regulatory Commission (FERC) largely side-stepped the issue when it originally promulgated its pro forma Large Generator Interconnection Procedures (LGIP) and Large Generator Interconnection Agreement (LGIA) in Order No. 2003.  The pro forma LGIP, for example, includes loose concepts of “coordination” and “cooperation,” without specific details or deadlines.  A Transmission
Continue Reading Issue of Coordination with Affected Systems Rises to Forefront at FERC

Energy
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FERC Issues Final Rule Requiring RTOs to Provide for Participation of Electric Storage Resources in Organized MarketsMarch 1, 2018

Practice Area: Energy

On February 15, 2018, the Federal Energy Regulatory Commission (“FERC”) issued Order No. 841, Electric Storage in Markets Operated by Regional Transmission Organizations and Independent System Operators. Order No. 841 requires tariff reforms in order to facilitate the participation of electric storage resources in capacity, energy, and ancillary services markets operated by Regional Transmission Organizations (“RTOs”) and Independent System Operators (“ISOs”).
After soliciting public input on its Notice of Proposed Rulemaking (“NOPR”), FERC concluded that existing
Continue Reading FERC Issues Final Rule Requiring RTOs to Provide for Participation of Electric Storage Resources in Organized Markets

Energy
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FERC Terminates Rulemaking Aimed At Increasing RTO/ISO Reliance On Merchant Coal and Nuclear Resources, Initiates New Proceeding To Explore RTO/ISO Resilience IssuesJanuary 1, 2018

Practice Area: Energy

On January 8, 2018, the Federal Energy Regulatory Commission (FERC or Commission) issued an Order terminating a rulemaking initiated in Docket No. RM18-1-000 in which the Commission, acting at the request of the Department of Energy (DOE), considered requiring Regional Transmission Organizations (RTOs) and Independent System Operators (ISOs) to establish tariff mechanisms ensuring appropriate compensation to “baseload” generating units with a ninety-day supply of onsite fuel storage when they participate in
Continue Reading FERC Terminates Rulemaking Aimed At Increasing RTO/ISO Reliance On Merchant Coal and Nuclear Resources, Initiates New Proceeding To Explore RTO/ISO Resilience Issues

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FERC Sets Agenda for Technical Conference on Natural Gas Index Liquidity and TransparencyJune 15, 2017

Practice Area: Energy

On June 29, 2017, the Federal Energy Regulatory Commission (FERC) will hold a technical conference to discuss liquidity in the natural gas markets and what, if anything, the industry or FERC can do to increase transparency and robustness in natural gas price formation.
The day-long conference will feature three stakeholder panels. The first panel, featuring publishers of natural gas newsletters, will examine the current state of natural gas indices, the degree of industry reliance on index-based contracts rather than fixed-price
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Energy
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DOE Requires FERC to Consider Rule Promoting Grid Resiliency by Providing Coal and Nuclear Plant SubsidiesOctober 6, 2017

Practice Area: Energy

On September 29, 2017, Energy Secretary Rick Perry directed the Federal Energy Regulatory Commission (FERC) to initiate a rulemaking that could result in major subsidies for coal fired and nuclear powered electric generators in RTO markets. The Secretary argues that wholesale electricity markets are not properly compensating coal and nuclear units for their contributions to electric grid resiliency, thereby causing premature retirements. The Department of Energy (DOE) proposal would effectively subsidize uneconomic coal and nuclear plants that
Continue Reading DOE Requires FERC to Consider Rule Promoting Grid Resiliency by Providing Coal and Nuclear Plant Subsidies

Energy
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New Court Decision Opens Door to Broader Assertion of Jurisdiction by FERC over Governmental EntitiesJune 2, 2017

Practice Area: Energy

The U.S. Court of Appeals for the D.C. Circuit issued a decision recently finding that the Federal Energy Regulatory Commission (“FERC”) had authority to order the Bonneville Power Administration (“BPA”) to pay money to a public utility.  This holding is significant because BPA is a governmental entity exempt from FERC’s jurisdiction under most provisions of the Federal Power Act (“FPA”).
In TNA Merchant Projects, Inc. v. FERC, No. 13-1008, an issue arose before FERC as to whether a generator
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Energy
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FERC Weighs Tax Policy Changes in Wake of Ruling in United Airlines, Inc. v. FERCMay 3, 2017

Practice Area: Energy

On December 15, 2016, the Federal Energy Regulatory Commission (FERC) issued a Notice of Inquiry (NOI) in Docket No. PL17-1, seeking comments on how to address any double recovery that may result from its tax allowance and rate of return policies in light of the ruling in United Airlines, Inc. v. FERC, 827 F.3d 122 (D.C. Cir. 2016). See Inquiry Regarding the Commission’s Policy for Recovery of Income Tax Costs, 157 FERC ¶ 61,210
(2016) (citing Composition of Proxy Groups for
Continue Reading FERC Weighs Tax Policy Changes in Wake of Ruling in United Airlines, Inc. v. FERC