Regulatory & Compliance / Power / Project Finance FERC Meeting Agenda Summary In this issue… • Electric Items • Gas Items • Hydro Items • Certificates 14 June 2016 Authors: Daniel A. Hagan, Jane E. Rueger Below are brief summaries of the agenda items for the Federal Energy Regulatory Commission’s June 16, 2016 meeting, pursuant to the agenda as issued on June 9, 2016. Agenda items E-11 and E-18 have not been summarized due to omission from the agenda. Electric E-1 – Reactive Power Requirements for Non-Synchronous Generation (Docket No. RM16-1-000). On November 19, 2015, the Commission issued a proposal to eliminate the exemptions for wind generators from the requirement to provide reactive power. The Commission stated that as a result of the proposal, all newly interconnecting generators, including both synchronous and non-synchronous generators, would be required to provide reactive power. To implement this requirement, the Commission proposed to revise the pro forma Large Generator Interconnection Agreement (LGIA), Appendix G to the pro forma LGIA, and the pro forma Small Generator Interconnection Agreement (SGIA). Agenda item E-1 may be an order on the Commission’s proposal. E-2 – Settlement Intervals and Shortage Pricing in Markets Operated by Regional Transmission Organizations and Independent System Operators (Docket No. RM15-24-000). On September 17, 2015, the Commission issued a notice of proposed rulemaking, proposing to revise its regulations to require that each regional transmission organization (RTO) and independent system operator (ISO) settle energy transactions in its real-time markets at the same time interval it dispatches energy and settle operating reserves transactions in its real-time markets at the same time interval it prices operating reserves. The Commission also proposed to revise its regulations to require that each RTO/ISO trigger shortage pricing for any dispatch interval during which a shortage of energy or operating reserves occurs. Agenda item E-2 may be an order on the notice of proposed rulemaking. Newsletter White & Case 2 E-3 – Regulations Implementing FAST Act Section 61003–Critical Electric Infrastructure Security and Amending Critical Energy Infrastructure Information (Docket No. RM16-15-000). Agenda item E-3 may be a notice of proposed rulemaking regarding regulations implementing FAST Act Section 61003–Critical Electric Infrastructure Security and Amending Critical Energy Infrastructure Information. E-4 – Availability of Certain North American Electric Reliability Corporation Databases to the Commission (Docket No. RM15-25-000). On September 17, 2015, the Commission issued a notice of proposed rulemaking, proposing to amend its regulations to require the North American Electric Reliability Corporation (NERC) to provide the Commission, and Commission staff, with access, on a non-public and ongoing basis, to certain databases compiled and maintained by NERC. The Commission’s proposal applies to the following NERC databases: (1) the Transmission Availability Data System, (2) the Generating Availability Data System, and (3) the protection system misoperations database. The Commission stated that access to these databases, which will be limited to data regarding U.S. facilities, will provide the Commission with information necessary to determine the need for new or modified Reliability Standards and to better understand NERC’s periodic reliability and adequacy assessments. Agenda item E-4 may be an order on the notice of proposed rulemaking. E-5 – Midcontinent Independent System Operator, Inc. (Docket No. EL16-61-000). Agenda item E-5 may be an order instituting a new docket for a proceeding regarding Midcontinent Independent System Operator, Inc. E-6 – NextEra Energy Power Marketing, LLC and Northeast Energy Associates, a Limited Partnership v. ISO New England Inc. (Docket No. EL16-48-000). On March 18, 2016, pursuant to Sections 206 and 306 of the Federal Power Act (FPA), NextEra Energy Power Marketing, LLC and Northeast Energy Associates, a Limited Partnership (NEA) (collectively, Complainants) filed a complaint against ISO New England Inc. (ISONE) alleging that ISO-NE violated its Transmission, Markets and Services Tariff in preventing a capacity increase at NEA’s Bellingham Energy Center (Bellingham) from being added to Bellingham’s summer Qualified Capacity in the tenth Forward Capacity Auction that was held on February 8, 2016. Agenda item E-6 may be an order on the complaint. E-7 – Filing Requirements for Electric Utility Service Agreements; Electricity Market Transparency Provisions of Section 220 of the Federal Power Act; Revisions to Electric Quarterly Report Filing Process; Electric Quarterly Reports (Docket Nos. RM01-8-000, RM10-12-000, RM12-3-000, ER02-2001- 000). Agenda item E-7 may be an order on filing requirements for electric utility service agreements, the electricity market transparency provisions of Section 220 of the FPA, revisions to the Electronic Quarterly Report (EQR) filing process, and other matters related to EQRs. E-8 – Interconnect Solar Development LLC (Docket Nos. EL16-55-000, QF11-204-002, QF11-205-002). On April 18, 2016, the Interconnect Solar Development LLC filed a Petition for Enforcement alleging that Idaho Power unlawfully cancelled a power purchase agreement with its 20 MW utility scale solar project. Agenda item E-8 may be an order on the Petition for Enforcement. E-9 – NRG Power Midwest, LP (Docket Nos. ER16-1443-000, EL16-72-000). On April 15, 2016, NRG Power Midwest, LP submitted proposed revisions to its FERC Rate Schedule No. 2 to reflect a reduction in the cost-based annual revenue requirement for Reactive Supply and Voltage Control from Generation Sources Service in connection with the deactivation of Unit 7 at the Avon Lake fossil-fueled generating facility. Agenda item E-9 may be an order on NRG Power Midwest’s filing. E-10 – Arizona Public Service Company (Docket No. OA16-1-000). On February 1, 2016, Arizona Public Service Company (APS) filed a notice that it failed in two consecutive quarters to complete more than 80 percent of non-Affiliate’s System Impact Studies within the 60-day study completion deadline as required by the directives set out in Order Nos. 890 and 890-A. Agenda item E-10 may be an order on APS’s notice. E-11 – Omitted Newsletter White & Case 3 E-12 – Midwest Independent Transmission System Operator, Inc. (Docket No. ER12-2302-004). On July 25, 2012, MISO filed to revise certain provisions of its Tariff related to Attachment Y notices, which are required prior to retiring or suspending a resource, and other System Support Resources-related provisions. On July 22, 2014, the Commission conditionally accepted MISO’s proposed revisions, but found that MISO had not proposed procedures to ensure that the transfer of interconnection service to a new generator, or to increase the capacity of an existing facility at the identical point of interconnection, would be conducted in a just and reasonable and not unduly discriminatory manner. On September 19, 2014, MISO submitted a compliance filing with proposed Tariff revisions to address the retention of interconnection service as directed by the July 2014 Order. On December 17, 2015, the Commission issued an order stating that compliance adjustments proposed by MISO, among other things, conflicted with portions of Attachment X, Generator Interconnection Procedures, and directed MISO to make further adjustments. On February 1, 2016 MISO submitted an additional compliance filing. Agenda item E-12 may be an order on MISO’s February 1, 2016 compliance filing. E-13 – Entergy Arkansas, Inc. (Docket No. ER16-644-000). On December 29, 2015, Entergy Services, Inc., on behalf of its affiliate Entergy Arkansas, Inc. (collectively, Entergy) filed a request seeking authorization to recover nuclear decommissioning costs for the Arkansas Nuclear One Unit 2 generating plant. Agenda item E- 13 may be an order on Entergy’s request. E-14 – ISO New England Inc. (Docket No. ER16-1041-000). On February 29, 2016, ISO New England Inc. submitted its Forward Capacity Auction Results Filing for the tenth Forward Capacity Auction (FCA) as required by Section III.13.8.2 (a) of its Tariff. ISO New England stated that the tenth FCA was held on February 8, 2016 for the Capacity Commitment Period of June 1, 2019 through May 31, 2020. Agenda item E- 14 may be an order on ISO New England’s FCA filing. E-15 – NextEra Energy Transmission West, LLC (Docket No. ER15-2239-002). On July 22, 2015, NextEra Energy Transmission West, LLC (NEET West) filed under Section 205 of the FPA a proposed Transmission Owner Tariff (TO Tariff), including a formula rate and protocols designed to calculate its annual transmission revenue requirement to be received under the California Independent System Operator Corporation (CAISO) Open Access Transmission Tariff (Tariff). On January 8, 2016, the Commission issued an order accepting and suspending proposed TO Tariff, established settlement and judge procedures regarding the proposed ROE, and ordered NEET West to submit a compliance filing addressing certain issues regarding the formula rate and protocols. On February 9, 2016, NEET West submitted its compliance filing in accordance with the January 8 Order’s directive. Agenda item E-15 may be an order on NEET West’s compliance filing. E-16 – Tri-State Generation and Transmission Association, Inc. (Docket No. EL16-39-000). On February 17, 2016, the Tri-State Generation and Transmission Association, Inc. (Tri-State) filed a petition for declaratory order requesting the Commission find its fixed cost recovery proposal as contained in revised Board Policy 101 is consistent with the Public Utility Regulatory Policies Act of 1978 (PURPA). Specifically, the proposal would provide for the recovery of certain fixed costs that are not recovered from a member as a result of the member’s purchase of power from a QF in excess of a 5% limitation on the member’s self-supply of power. Agenda item E-16 may be an order on Tri-State’s petition for declaratory order. E-17 – PJM Interconnection, L.L.C. (Docket Nos. EL14-94-001, ER16-1291-000). On August 25, 2014, the Commission initiated a paper hearing pursuant to section 206 of the FPA to investigate certain provisions of PJM Interconnection, L.L.C.’s Tariff regarding calculation of projected market revenues used in determining the seller offer cap in the Reliability Pricing Model Auctions. On March 1, 2016, the Commission issued an order finding the provisions unjust and unreasonable, and unduly discriminatory or preferential, and directed PJM to submit a compliance filing. On March 30, 2016, PJM submitted the compliance filing containing proposed revisions to Attachment DD of the Tariff and a proposed effective date of March 1, 2016. In addition, on March 29, 2016, Monitoring Analytics, LLC, acting in its capacity as the Independent Market Monitor for PJM, filed a motion for clarification or, in the alternative, motion for rehearing of the Commission’s March 1 Order. Agenda item E-17 may be an order on the compliance filing and/or the motion for clarification or rehearing of the Commission’s March 1 Order. Newsletter White & Case 4 E-18 – Omitted E-19 – Southwest Power Pool, Inc. (Docket No. ER16-209-001). On October 30, 2015, Southwest Power Pool, Inc. (SPP) proposed revisions to its Tariff to add an Annual Transmission Revenue Requirement and to implement a Formula Rate for the provision of transmission service over facilities of SPP member Central Power Electric Cooperative, Inc. (Central Power), which would become a SPP transmission owner and transfer functional control of its transmission facilities to SPP on January 1, 2016. The proposal also would revise the SPP transmission planning process to include Central Power as a participant in SPP’s planning region and include protocols for an annual update process based on Central Power’s audited books and records of the most recent fiscal year. On December 30, 2015, the Commission issued an order finding that Central Power was not within the Commission’s jurisdiction under section 205 of the FPA but it is appropriate to apply the just and reasonable standard of FPA section 205 to SPP’s proposed rates filed on behalf of Central Power and directed settlement and hearing procedures to determine the justness and reasonableness of Central Power’s rates. On January 28, 2016, the Minnesota Public Utilities Commission, the North Dakota Public Service Commission, and the South Dakota Public Utilities Commission filed a request for clarification and rehearing regarding whether the Commission in its December 30 order intended to prevent parties from raising certain issues in hearing and settlement judge procedures. Agenda item E-19 may be an order on the request for clarification and rehearing. E-20 – PJM Interconnection, L.L.C. (Docket Nos. ER15-623-006, ER15-623-007, ER15-623-008, EL15-29- 004) and Advanced Energy Management Alliance Coalition v. PJM Interconnection, L.L.C. (Docket No. EL15-80-001). On December 12, 2014, PJM Interconnection, L.L.C. (PJM) filed revisions to its Tariff regarding Capacity Performance provisions in which certain resources would be subject to stringent performance requirements and penalties for failure to deliver energy when called upon during the most critical hours of the delivery year as well as a proposal to hold transition auctions to procure Capacity Performance capacity in 2016-17 and 2017-18 for which the Base Residual Auction had already been conducted. In an order dated June 9, 2015, the Commission conditionally accepted the proposed revisions to the PJM Tariff, including the definition of Capacity Performance Resources and the transition auction mechanism. Subsequently, on June 29, 2015, Advanced Energy Management Coalition (AEMA) filed a complaint pursuant to Section 2016 of the FPA requesting the Commission determine whether Annual Demand Resources and Annual Energy Efficiency Resources can participate in the transition auctions, and, if not, the relevant provisions are unjust, unreasonable, and unduly discriminatory. On July 22, 2015, the Commission issued an order concluding the PJM Tariff Capacity Performance provisions do not allow non-generation resources to participate in the transition auction and granting in part AEMA’s complaint, finding that excluding demand response and other non-generation resources from participating in transition auction was unjust and unreasonable and unduly discriminatory as applied to technically-capable resources willing to perform as a Capacity Performance Resource. The July 22 Order directed PJM to allow for participation by such non-generation resources in the transition auctions and to submit compliance filings to implement the directed changes. On July 28, 2015, and on October 27, 2015, PJM submitted certain compliance filings in accordance with the Commission’s July 22 Order. In addition, on August 21, 2016, the Talen Companies filed a request for rehearing of the Commission’s July 22 Order, asserting arguments regarding the Commission’s jurisdiction to regulate demand response resources. Agenda item E-20 may be an order on the PJM compliance filings and/or the request for rehearing of the July 22 Order. Gas G-1 – ANR Storage Company (Docket No. RP12-479-001). On March 6, 2012, ANRS filed a petition for a declaratory order requesting authorization to charge market-based rates, contingent on proving that it did not possess market power. Following a proceeding with several intervening parties and a formal hearing, the Presiding Judge in this docket issued an Initial Decision on January 29, 2014. The Initial Decision found that ANRS had not satisfied the burden of proof in lacking market power and consequently denied the application for market-based rate authority. On October 15, 2015, the Commission issued an order affirming the denial as set forth in the Initial Decision. ANRS filed a request for rehearing of the October 15, 2015 order on November 13, 2015. Agenda item G-1 may be an order on the request for rehearing. Newsletter White & Case 5 Hydro H-1 – Twin Lakes Canal Company (Docket No. P-12486-008). On November 27, 2013, Twin Lakes Canal Company (Twin Lakes) filed an application for an original license with the Commission for the construction, operation, and maintenance of the proposed 10 MW Bear River Narrows Hydroelectric Project No. 12486-008 located on the main stream of the Bear River in Franklin County, Idaho. On November 30, 2015, a draft Environmental Impact Statement (EIS) for the project was issued by the Office of Energy Projects. On November 27, 2016, the final EIS for the project was issued on April 27, 2016, by the Office of Energy Projects. Agenda item H-1 may be an order regarding the Twins Lake license application. H-2 – PacifiCorp (Docket No. P-2082-027). On February 25, 2004, PacifiCorp filed an application for a new license for the Klamath Hydroelectric Project (FERC No. 2082). Following consultation with the six federallyregistered tribes in the project area, scoping, and preparation of a draft Environmental Impact Statement (EIS), Commission staff issued its final EIS for the relicensing in November, 2007. However, the Commission has been unable to issue a license decision because neither Oregon nor California have issued water quality certification under Section 401 of the Clean Water Act or waived their authority to do so, which precludes the Commission from issuing a license absent certification or waiver. On March 28, 2016, the Klamath County Commissioners of Oregon submitted a letter regarding the new license applications. Agenda item H-2 may be an item related to the new license applications. H-3 – David O. Harde (Docket No. P-8722-018). On December 11, 2015, the Commission issued a Notice of Termination of License (Minor Project) by Implied Surrender regarding the Landis-Harde Hydroelectric Project located in El Dorado County, California. The Commission indicates the project has not been operational since 2006 and has requested correspondence from the licensee as to the status of a potential transfer application, as discussed through several years of prior correspondence. The licensee has been unresponsive and, as a result, the Commission initiated this proceeding to terminate the project license. On January 11, 2016, a motion to intervene was filed by an individual indicating discussions with the project owner to transfer the license and the intent to submit a joint License Transfer Application. Agenda item H-3 may be an order on the request to file a License Transfer Application or an order on the Termination of License. H-4 – Alabama Power Company (Docket No. P-2146-195). On March 9, 2016, the Commission issued an order modifying and approving the recreation flow release evaluation report in this docket. The project under consideration is the refurbishment of a unit located on the Coosa River in Alabama. On April 5, 2016, the Coosa River Paddling Club filed a motion to intervene out-of-time and a request for rehearing, citing public safety concerns relating to the recreational uses of the river. Agenda item H-4 may be an order on the request for rehearing. Certificates C-1 – Northern Natural Gas Company (Docket No. CP15-552-000). On September 9, 2015, Northern Natural Gas Company (Northern) submitted an application pursuant to the NGA for the issuance of a Certificate of Public Convenience and Necessity (CPCN) to construct and operate a compressor station located in Gaines County, Texas. Several parties filed motions to intervene in addition to an exchange of data from Northern in response to Commission inquiries. On May 09, 2016, the Commission issued an Environmental Assessment Report indicating no significant adverse impacts. Agenda item C-1 may be an order on the application for a CPCN. C-2 – Impulsora Pipeline, LLC (Docket No. CP16-70-000). On May 14, 2015, the Commission issued an order granting Impulsora Pipeline, LLC (Impulsora) authorization under the NGA and a Presidential Permit to construct and operate two natural gas pipelines at the international boundary between the United States and Mexico. On November 19, 2015, the Commission denied a request for rehearing filed by Impulsora and amended the authorization. Impulsora filed an application on February 4, 2016, requesting to terminate the authorization for one pipeline and retain the authorization for the other, citing recent commercial and financial developments. On March 9, 2016, the Commission issued an Environmental Assessment Report indicating the environment was not involved in this application. The United States Department of State and Department Newsletter White & Case 6 of Defense, respectively, filed comments of no objection to the application. Agenda item C-2 may be an order on the application by Impulsora to terminate the authorization of one pipeline. C-3 – Transcontinental Gas Pipe Line Company, LLC (Docket No. CP15-29-001); Sabine Pass Liquefaction, LLC and Sabine Pass LNG, L.P. (Docket No. CP15-482-001). On May 5, 2015, Sabine Pass Liquefaction, LLC and Sabine Pass LNG, L.P. (collectively, Sabine Pass) submitted an application pursuant to the NGA for a limited amendment to construct a pipeline in Cameron Parish, Louisiana in order to deliver natural gas from Transcontinental Gas Pipe Line Company (Transco). The Commission issued an Environmental Assessment Report on August 14, 2015, finding that approval of both projects would not pose a significant risk to the environment. On October 21, 2015, the Commission issued an order granting a certificate and amending the authorization under the NGA. In the following period, Sabine Pass has filed monthly reports regarding the status of construction. On November 20, 2015, Transco filed a motion for clarification or request for rehearing of the October 21, 2015 order. Agenda item C-3 may be an order on the request by Transco. C-4 – Paiute Pipeline Company (Docket Nos. CP14-509-003, RP16-212-001). On June 27, 2014, Paiute Pipeline Company (Paiute) filed an application for a CPCN to construct and operate an interstate natural gas pipeline located in northeast Nevada. Several parties intervened in the proceeding and the Commission released an Environmental Assessment Report indicating no significant environmental impact. The Commission granted the CPCN application on May 14, 2015; however, Paiute filed a request for rehearing regarding certain aspects of the order on June 12, 2015. On December 14, 2015, the Commission issued an order denying the request for rehearing and rejecting proposals to amend the rates authorized in the May 14, 2015 order. On January 13, 2016, Southwest Gas Corporation filed a request for rehearing of the December 14 order. Agenda item C-4 may be an order on the request for rehearing. 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