Below are brief summaries of the agenda items for the Federal Energy Regulatory Commission’s October 15, 2009 meeting. Item Nos. E-5, E-11, E-12, and H-2 are not summarized as they have been omitted from the Commission’s agenda.
A-1 (Docket No. AD02-1-000)
This administrative item will address FERC’s Strategic Plan.
A-2 (Docket No. AD02-7-000)
This administrative item will address customer matters, reliability, security and market operations.
A-3 (Docket No. AD06-3-000)
This administrative item will be an assessment of the Winter Energy Market.
E-1: New York Independent System Operator, Inc., New York Transmission Owners (Docket Nos. OA08-52-004, -006)
On October 16, 2008, FERC issued an order (October 16 Order) conditionally accepting, subject to the submission of a compliance filing, a set of comprehensive tariff amendments developed by the New York Independent System Operator, Inc. (NYISO) and the New York Transmission Owners (NYTOs) (collectively, Joint Filing Parties) to address the planning requirements in Order Nos. 890 and 890-A. Those tariff changes created a three-stage Comprehensive System Planning Process in New York that includes a Local Transmission Owner Planning Process (LTPP), a Comprehensive Reliability Planning Process and an economic planning process called the Congestion Analysis and Resource Integration Study (CARIS). In the October 16 Order, FERC directed the NYISO to submit a compliance filing addressing the LTPP, the committee decision-making process, the manner in which stakeholders are able to replicate NYISO planning studies, the dispute resolution processes applicable to the planning process, and certain aspects of the mechanism for evaluating economic upgrades. On January 14, 2009, the Joint Filing Parties submitted a compliance filing addressing all of FERC’s directives except for two—additional specifications for the methodology for allocating costs of economic projects developed under the CARIS and the additional metrics to be used by beneficiaries of economic projects to evaluate those projects for voting purposes.
Subsequently, on May 19, 2009, the Joint Filing Parties submitted a compliance filing to address the two remaining issues. Agenda item E-1 may be an order addressing the Joint Filing Parties’ January 14 and May 19, 2009 compliance filings.
E-2: New York Independent System Operator, Inc. (Docket No. OA08-52-005)
On March 31, 2009, FERC issued an order granting in part and denying in part an October 16, 2008, order which conditionally accepted the NYISO’s filing of its transmission planning process in compliance with Order No. 890 (March 31 Order). In the March 31 Order, FERC (i) clarified that it previously accepted the NYISO’s revised Reliability Agreement, which specifies the rights and obligations of the NYTOs associated with their participation in the NYISO planning process; (ii) clarified that the NYTOs and other developers, and not NYISO, have the burden to justify the justness and reasonableness of the rates they file for jurisdictional regulated transmission reliability projects under new Rate Schedule 10 of the NYISO’s open access transmission tariff (OATT); (iii) denied a request for rehearing or clarification of its approval of NYISO’s proposed cost/benefit study, finding that NYISO’s proposed benefit metric is just and reasonable; and (iv) denied rehearing of its finding that NYISO’s proposed supermajority voting proposal is a reasonable component of NYISO’s economic planning process, concluding that a supermajority voting procedure is a reasonable method of determining which economic transmission project should be subject to OATT cost recovery. On April 29, 2009, the New York Regional Interconnect, Inc. (NYRI) filed a request for rehearing of the March 31 Order and a motion to reopen the record. NYRI alleged that FERC committed reversible error in the March 31 Order by failing to consider a NYISO white paper addressing transmission expansion in New York state (White Paper) and by concluding that FERC is under no obligation to consider the anticompetitive effect that the NYISO’s cost/benefit analysis and supermajority voting scheme will have on transmission development and the energy market in New York. NYRI stated that it seeks an order requiring the NYISO to put in place a just, reasonable, nondiscriminatory and competitive transmission expansion process that treats congestion reduction projects objectively and fairly. NYRI requested that FERC reopen the record and include the White Paper in this docket and that FERC grant rehearing of the March 31 Order. Agenda item E-2 may be an order on rehearing of the March 31 Order and/or NYRI’s motion to reopen the record.
E-3: North American Electric Reliability Corporation (Docket Nos. RR09-9-000, RR08-6-004, RR07-14-004)
On August 24, 2009, as corrected on September 18, 2009, the North American Electric Reliability Corporation (NERC) submitted: (i) its proposed Business Plan and Budget as the Electric Reliability Organization for the year ending December 31, 2010; (ii) the proposed Business Plans and Budgets for the year ending December 31, 2010 for the eight Regional Entities; (iii) the proposed budget of the Western Interconnection Regional Advisory Body (WIRAB) for activities under Federal Power Act (FPA) section 215(j) for the year ending December 31, 2010 and (iv) its proposed allocation of the proposed statutory funding requirements of NERC, the Regional Entities and WIRAB by country and among the Regions, and the proposed assessments to the load-serving entities (LSEs) within each Region to collect the allocated statutory funding requirements. NERC requested that FERC issue an order by November 2, 2009, accepting the proposed Business Plans and Budgets and approving the proposed assessments submitted in the August 24 filing. NERC stated that a Commission order issued by November 2, 2009, would enable billings to be issued to the LSEs or their designees for assessments with initial payment dates commencing on or about January 1, 2010, to support the activities of NERC and the Regional Entities during 2010. Agenda item E-3 may be an order on NERC’s filing.
E-4: North American Electric Reliability Corporation (Docket No. NP09-26-000)
On June 24, 2009, NERC submitted a Notice of Penalty (June 24 Notice) in response to the U.S. Army Corps of Engineers—Tulsa District’s (COE—Tulsa District) October 3, 2007, self-certification notice of non-compliance with certain mandatory Reliability Standards (October 3 Letter). In the October 3 Letter, COE— Tulsa District reiterated arguments presented in earlier letters sent from the COE to FERC that were based on the COE’s belief that, as a governmental entity, it was not required to comply with the Energy Policy Act of 2005. In the June 24 Notice, NERC noted that like COE—Tulsa District, other parts of the COE and other federal entities have raised jurisdictional challenges in a number of enforcement cases pending before NERC and the Regional Entities. NERC requested that FERC issue a clear decision on the scope of NERC and FERC’s jurisdiction under FPA section 215. On June 26, 2009, FERC issued a notice of the June 24 Notice and requested public comment regarding the applicability of mandatory Reliability Standards under FPA section 215 to the COE and other federal agencies. Several parties responded to FERC’s request for comment. By notice issued July 27, 2009 (July 27 Notice), FERC allowed the June 24 Notice to become effective by operation of law on July 24, 2009. In the July 27 Notice, FERC further stated that the jurisdictional issue would be addressed in a subsequent order. Agenda item E-4 may be an order addressing the scope of NERC and FERC’s jurisdiction under FPA section 215.
E-6: Western Electricity Coordinating Council Regional Reliability Standard Regarding Automatic Time Error Correction (Docket No. RM08-12-001)
On May 21, 2009, FERC issued Order No. 723 in which it approved regional Reliability Standard BAL-004-WECC-01 (Automatic Time Error Correction) and directed the Western Electricity Coordinating Council (WECC) to develop several modifications to the regional Reliability Standard. FERC explained that the regional Reliability Standard requires balancing authorities within the WECC region to implement an automatic time error correction procedure for the purpose of maintaining interconnection frequency within a predefined frequency profile and ensuring that time error corrections are effectively conducted in a manner that does not adversely affect reliability. FERC also accepted three related definitions, approved the violation risk factors for the regional Reliability Standard, and directed the Electric Reliability Organization and WECC to submit revised violation risk factors. Xcel Energy Services Inc. (XES) requested clarification or, in the alternative, rehearing, of Order No. 723 on June 22, 2009. XES argued that FERC provided conflicting guidance on which Area Control Error a Balancing Authority should use for NERC reporting purposes. Agenda item E-6 may be an order addressing XES’ request for rehearing or clarification of Order No. 723.
E-7: Revisions to Form, Procedures, and Criteria for Certification of Qualifying Facility Status for a Small Power Production or Cogeneration Facility (Docket No. RM09-23-000)
Agenda item E-7 may be a Notice of Proposed Rulemaking concerning changes to the process for certification of Qualifying Facility Status for a Small Power Production or Cogeneration Facility.
E-8: Interest Rates for Refunds (Docket No. RM09-24-000)
Agenda item E-8 may be a Notice of Proposed Rulemaking concerning the details of applying the interest rates for refunds.
E-9: PJM Interconnection, L.L.C. (Docket Nos. ER06-456- 006, ER06-954-002, ER06-1271-001, ER07-424-000, EL07- 57-000)
In January 2006, PJM Interconnection, L.L.C. (PJM) filed with the Commission to assign cost responsibility for transmission upgrades that were taken as part of PJM’s Regional Transmission Expansion Plan. A dispute arose concerning the cost responsibility, if any, of Merchant Transmission Facilities for these transmission upgrades. The Presiding Judge conducted a hearing and issued his Initial Decision on September 18, 2008, which upheld most of PJM’s proposed cost allocation methodology. Numerous briefs on exceptions and briefs opposing exceptions were filed. Agenda item E-9 may be the Commission’s order on the Initial Decision and the exceptions raised by the parties to the proceeding.
E-10: Midwest ISO Transmission Owners (Docket No. ER08-15-002)
On March 31, 2008, FERC accepted the proposal of the Midwest ISO Transmission Owners to amend Schedule 2 of the Midwest Independent Transmission System Operator, Inc.’s (MISO) Open Access Transmission and Energy Market Tariff to allow the Transmission Owners to choose whether to compensate unaffiliated generators for Reactive Supply Service under Schedule 2 (on a capability basis) or under Schedule 2-A (only for the provision of reactive power outside the deadband). Requests for rehearing were timely filed, and Agenda item E-10 may be the order on rehearing.
E-13: Louisville Gas & Electric Company/Kentucky Utilities Company (Docket No. ER02-2560-009)
In September 2002, Louisville Gas & Electric/Kentucky Utilities Company (LG&E/KU) filed amendments to their Transmission and Interconnection Agreements to adjust the rates under the Agreements in order to charge the MISO Attachment O formula rate for the LG&E/KU zone. After a series of orders, on August 20, 2007, LG&E/KU agreed to make certain adjustments to the proposed rates in the Agreements and submitted a refund report. Gallatin Steel Company and East Kentucky Power Cooperative challenged this compliance filing. Agenda item E-13 may be the order on the compliance filing.
M-1: Standards of Conduct for Transmission Providers (Docket No. RM07-1-001)
October 16, 2008, FERC issued Order No. 717, substantially revising its standards of conduct for transmission providers. Among other changes, FERC eliminated the concept of “energy affiliate” and shifted from a corporate separation approach to an employee function approach to the relationship between transmission providers and their marketing functions or affiliates. Numerous parties requested rehearing or clarification of Order No. 717, many seeking clarification with respect to the definition of “marketing function” and “transmission function information” adopted in Order No. 717, as well as the types of interactions between transmission function and marketing function employees that are permissible under the new rules. Agenda item M-1 may be an order on rehearing or clarification of Order No. 717.
G-1: Texas Eastern Transmission, LP (Docket Nos. RP99-480-024, RP09-143-000)
On December 3, 2008, in Docket No. RP99-480-024, Texas Eastern Transmission, LP (Texas Eastern) submitted revised tariff sheets as part of its FERC Gas Tariff, Seventh Revised Volume No. 1 in order to reflect modifications to the negotiated rate agreements of two shippers—New Jersey Natural Gas Company and PSEG Power, LLC—whereby the shippers agreed to a cap on certain fuel charges for the period December 1, 2008 through November 30, 2009. Texas Eastern also proposed that the fuel caps referenced in the negotiated rate agreements would apply to any replacement shipper pursuant to a capacity release transaction. On December 5, 2008, in Docket No. RP09-143-000, Texas Eastern requested confirmation from FERC that it was unnecessary to post the negotiated fuel rates under those two negotiated rate agreements for competitive bidding in order to comply with FERC’s capacity release rules or, in the alternative, requested waiver of any such posting requirement with respect to the negotiated fuel rates. Texas Eastern further requested clarification that it did not have to refile with FERC the individual negotiated rate sheets with replacement shippers solely to reflect the negotiated fuel rates. On December 30, 2008, by delegated letter order, FERC accepted Texas Eastern’s revised tariff sheets and suspended them effective December 1, 2008, subject to refund and further Commission review in conjunction with Texas Eastern’s requests in Docket No. RP09-143. Agenda item G-1 may be FERC’s determination on further review.
G-2: Texas Eastern Transmission, LP, et al. (Docket Nos. RP09-70-000, et al.)
In the latter half of 2008 and early 2009, numerous natural gas pipelines filed revisions to their FERC gas tariffs to comply with changes made to FERC’s capacity release requirements promulgated in Order No. 712. While most of these revisions were addressed by FERC in prior orders, certain issues regarding the pipelines’ offering of usage charge discounts to replacement shippers (particularly asset managers) in light of changes to FERC’s revised capacity release program were left open to further proposals by the individual pipelines, comments by intervenors and later orders by FERC. Agenda item G-2 may be FERC’s order addressing these issues with respect to the following twenty-nine pipelines: Texas Eastern; Saltville Gas Storage Company L.L.C.; East Tennessee Natural Gas, LLC; Egan Hub Storage, LLC; ANR Pipeline Co.; Northwest Pipeline GP; Natural Gas Pipeline Co. of America LLC; Transcontinental Gas Pipe Line Co., LLC; Panhandle Eastern Pipe Line Co., LP; Quest Pipelines (KPC); Tres Palacios Gas Storage LLC; CenterPoint Energy Gas Transmission Co.; CenterPoint Energy-Mississippi River Transmission Corp.; Kinder Morgan Interstate Gas Transmission LLC; Rockies Express Pipeline LLC; National Fuel Gas Supply Corp.; Questar Pipeline Co.; Columbia Gulf Transmission Co.; Dominion Transmission, Inc.; Tennessee Gas Pipeline Co.; El Paso Natural Gas Co.; Southern Natural Gas Co.; Columbia Gas Transmission, LLC; Colorado Interstate Gas Co.; Wyoming Interstate Co., Ltd.; Cheyenne Plains Gas Pipeline Co., LLC; Gulf South Pipeline Co., LP; Texas Gas Transmission, LLC and Enbridge Pipelines (Midla), L.L.C.
G-3 Columbia Gas Transmission, LLC (Docket Nos. RP09-792-000, -001)
On June 30, 2009, as revised on July 1, 2009, Columbia Gas Transmission, LLC (Columbia) filed revised tariff sheets to recover retroactively certain one-time third-party transportation costs incurred to provide service during the outage of Columbia’s Line 1278 located in Pike County, Pennsylvania. Several protests were filed, questioning the prudency of Columbia’s emergency actions in response to the outage and whether the causes of the outage were within Columbia’s control thereby rendering the proposed separate pass-through of the third-party transportation costs unjust and unreasonable. On July 31, 2009, FERC accepted and suspended the revised tariff sheets, effective January 1, 2010, subject to refund and further FERC review of the issues raised. Agenda item G-3 may be FERC’s determination on further review.
H-1: Pacific Gas and Electric Company (Docket No. P-2130-038)
On April 24, 2009, FERC issued a new license to Pacific Gas and Electric Company (PG&E) for the continued operation and maintenance of the Spring Gap-Stanislaus hydroelectric project. On May 21, 2009, PG&E filed a request for rehearing or clarification of that order, seeking rehearing with respect to the inclusion of certain facilities in the project, the failure to include certain revised terms and conditions of the US Forest Service, and certain other conditions on the new license. PG&E also requested clarification of certain other terms and conditions of the new license, as well as a stay of certain conditions of the Water Quality Certification for the project due to anticipated imminent revision by the California State Water Resources Control Board. Agenda item H-1 may be an order responding to PG&E’s request for rehearing, clarification and stay.
H-3: AmerenUE (Docket No. P-459-282)
On April 8, 2009, Commission staff issued an Order (April 8 Order) modifying and approving AmerenUE’s public access plan for the Pebble Creek development of the Osage Hydroelectric Project No. 459, located along Lick Creek Cove of the Lake of the Ozarks in Camden County, Missouri. On March 6, 2009, Duncan’s Point Home Owners and Lot Owners Association, Inc. (petitioner) filed a motion to intervene, and on May 8, 2009, petitioner filed a request for rehearing of the April 8 Order. The Commission issued a Notice Dismissing Pleading and Request for Rehearing denying the petitioners motion and request for rehearing on June 8, 2009. The petitioner filed another Request for Rehearing and Motion to Intervene on July 7, 2009 arguing that the Commission failed to consider AmerenUE’s history of noncompliance and unwillingness to fully implement a FERC mitigation plan, among other things. Agenda item H-3 may be an order addressing the petitioner’s second Request for Rehearing and Motion to Intervene.
H-4: Alcoa Power Generating, Inc. (P-2197-096)
On September 17, 2009, Alcoa Power Generating, Inc. (APGI) filed a Petition for Declaratory Order finding that the Division of Water Quality of the North Carolina Department of Environment and Natural Resources (DWQ) has waived water quality certification under Section 401(a)(1) of the Clean Water Act regarding the Commission’s issuance of a new license for APGI’s Yadkin Hydroelectric Project (Project). APGI contends that DWQ failed to grant or deny certification within the requisite timeframe and therefore waived its statutory right to condition the issuance of a new license for the Project. Along with the Petition, APGI also submitted a Petition for Exemption in Lieu of Filing Fee. Stanly County and Senator Fletcher L. Hartwell, Jr. filed comments in this proceeding. Agenda H-4 may be an order addressing the Petition for Declaratory Order and/or the Petition for Exemption.
C-1: Columbia Gas Transmission, LLC, Jefferson Gas, LLC (Docket No. CP09-65-000)
On February 12, 2009, Columbia Gas Transmission, LLC (Columbia) and Jefferson Gas, LLC (Jefferson) submitted a joint application requesting the issuance of an order granting permission and approval to abandon by sale to Jefferson certain natural gas facilities located in Kentucky (Facilities) and approval to abandon the various services being provided through the Facilities to be sold. The applicants asserted that the proposed sale and abandonment of the Facilities is a continuation of Columbia’s program to redefine its pipeline system to better meet the needs of its customers. In addition, Jefferson requested a limited jurisdictional certificate pursuant to Section 7(c) of the NGA. Jefferson argued that the limited certificate is necessary to permit it to accept and deliver quantities of interstate gas at times when the local production is insufficient to meet the requirements of the markets along the pipeline. Agenda item C-1 may be an order on Columbia and Jefferson’s filing.
C-2: BCR Holdings, Inc. (Docket No. CP09-454-000)
On August 13, 2009, BCR Holdings, Inc. (BCR) filed a petition for an expedited determination that certain temporary acts and operations that BCR intends to undertake are exempt from the requirements of Section 7 of NGA. BCR intends to drill and conduct related testing analysis from one test water well to be located in Lafourche Parish, Louisiana, to drill a test well adjacent to an existing, previously plugged well on the Bully Camp salt dome, also in Lafourche Parish, Louisiana, to obtain salt core samples for testing and analysis and to determine the size and shape of the existing cavern at that location. BCR indicated that the purpose of the test water well will be to determine the optimal formations from which to withdraw water for use in leaching the caverns for a salt dome storage project which BCR plans to construct on the Bully Camp salt dome. BCR also indicated that the purpose of the re-entry well is to confirm that the salt in the dome is suitable for development as a natural gas storage facility and to determine the aerial extent of the existing cavern. Agenda item C-2 may be an order addressing the petition.
C-3: Columbia Gas Transmission, LLC (Docket No. CP08-431-001)
On March 19, 2009, the Commission granted Columbia’s request for authorization to expand storage capabilities at its Crawford and Weaver Storage Fields in Ohio. In the order, the Commission granted and denied proposals submitted by Charles R. Ogle and Melanie A. Ogle. The Ogles subsequently sought rehearing arguing that the proposed construction would have undue impact on them and that Columbia should be required to alter various components of its approval. On rehearing the Commission rejected the Ogle’s arguments. On July 28, 2009, the Ogles filed a motion for a stay of Columbia’s construction activities on their property, arguing that Columbia has no authority to place a proposed well on their land. The Ogles indicated that they have filed a complaint against Columbia in state court. The Commission dismissed the motion for stay and noted that the issue of whether an existing lease agreement between Columbia and the Ogles permitted the proposed construction activities was outside the Commission’s jurisdiction. On September 29, 2009, the Ogles filed another motion to stay which was denied on October 10, 2009. Agenda item C-3 may be an order addressing the dispute between Columbia and the Ogles.