Below are brief summaries of the agenda items for the Federal Energy Regulatory Commission’s September 16, 2010 meeting, pursuant to the agenda as issued on September 9, 2010. Agenda items E-5 and E-6 are not summarized as they were omitted from the September 9 agenda.
A-1: (Docket No. AD02-1-000)
This administrative item will address Agency Administrative Matters.
A-2: (Docket No. AD02-7-000)
This administrative item will address Customer Matters, Reliability, Security and Market Operations.
E-1: Terra-Gen Dixie Valley, LLC, TGP Dixie Development Company, LLC, and New York Canyon, LLC (Docket No. EL10-29-000); Green Borders Geothermal, LLC v. Terra-Gen Dixie Valley, LLC (Docket No. EL10-36-000).
On December 24, 2009, Terra-Gen Dixie Valley, LLC (Terra-Gen), TGP Dixie Development Company, LLC and New York Canyon, LLC (collectively, Petitioners) submitted a petition for declaratory order requesting that FERC confirm Petitioners’ firm transmission rights to 360 MW of capacity in the Dixie Valley 212-mile, 230 kV radial generator tie-line needed to interconnect Petitioners’ existing and planned geothermal projects to the transmission network in California. Petitioners have completed a power purchase agreement with deliveries scheduled to begin in 2012 and want to pursue federal fast-track financial incentives under the American Reinvestment and Recovery Act. In response, on January 25, 2010, Green Borders Geothermal, LLC (Green Borders) filed a complaint against Terra-Gen protesting the failure of Terra-Gen to file an Open Access Transmission Tariff (OATT) and to provide open access transmission service. Agenda item E-1 may be an order on the petition for declaratory order and the complaint.
E-2: North American Electric Reliability Corporation (Docket No. RR09-7-000); Reliability Standards Development and NERC and Regional Entity Enforcement (Docket No. AD10-14-000).
On July 20, 2009, the North American Electric Reliability Corporation (NERC) submitted its Three-Year Electric Reliability Organization Performance Assessment Report. The report contained a list of specific NERC actions in response to stakeholder and Regional Entity comments and recommendations, a discussion of how NERC meets the Electric Reliability Organization (ERO) certification criteria, NERC program areas statement of activities and achievements, NERC’s evaluation of the Regional Entities, and joint Regional Entity Self-Assessment and Regional Entity Statements of Activities and Achievements and stakeholder survey results. On July 6, 2010, FERC hosted a technical conference concerning industry perspectives on certain issues pertaining to the development and enforcement of mandatory Reliability Standards for the Bulk-Power System. The technical conference focused on the ERO’s standards development process, the ERO and Regional Entities’ monitoring and enforcement, and the communication and interactions between FERC, the ERO and the Regional Entities. Agenda item E-2 may be an order on NERC’s Performance Assessment Report and/or issues related to the technical conference.
E-3: North American Electric Reliability Corporation (Docket No. RR09-6-001).
On March 18, 2010, FERC issued an order directing NERC to propose modifications to its Rules of Procedure in order to address a conflict between NERC’s Standards Development Process and its obligation as the ERO to comply with a FERC directive under Section 215(d)(5) of the Federal Power Act (FPA). Under FPA Section 215(d)(5), FERC can direct, under certain circumstances, the ERO to submit to FERC a new or modified Reliability Standard that addresses a specific matter. But, under NERC’s Standards Development Process, every new or modified Reliability Standard must be approved by a two-thirds vote of the stakeholder ballot body in order to be presented to the NERC Board of Trustees. FERC expressed concern that, under NERC’s current Standards Development Process, the ballot body could be used to prevent compliance with a FERC directive under FPA Section 215(d)(5). Multiple parties requested rehearing of the FERC order. Agenda item E-3 may be an order on rehearing. E-4: Promoting a Competitive Market for Capacity Reassignment (Docket No. RM10-22-000).
On April 29, 2010, FERC issued a Notice of Proposed Rulemaking (NOPR) proposing to permanently lift the price cap for all transmission customers reassigning transmission capacity beyond October 1, 2010, in order to have the market for capacity reassignment serve as a competitive alternative to primary capacity. This NOPR would make permanent FERC’s action in the Order No. 890 proceedings to lift the price cap on reassignment of capacity for a two-year period. Numerous parties filed comments in response to the NOPR. Agenda item E-4 may be an order on the NOPR.
E-7: North American Electric Reliability Corporation (Docket No. RD10-5-000).
On December 2, 2009, NERC submitted a petition requesting approval for interpretations of Requirements R2 and R8 in Reliability Standard MOD-001-1 (Available Transmission System Capability) and Requirements R5 and R6 in Reliability Standard MOD-029-1 (Rated System Path Methodology). The NERC Board of Trustees stated that the interpretations follow a standard of strict construction, which did not expand the reach or attempt to correct a perceived gap or deficiency in the relevant Reliability Standards. Agenda item E-7 may be an order on NERC’s petition.
E-8: North American Electric Reliability Corporation (Docket No. RD09-5-000).
On March 5, 2009, NERC submitted a petition requesting approval for an interpretation of the requirements in Reliability Standard VAR-002-1a (Generator Operation for Maintaining Network Voltage Schedules). The interpretation concerns which requirements in VAR-002-1a apply to generators that do not operate generators that are equipped with automatic voltage regulators. Agenda item E-8 may be an order on NERC’s petition.
E-9: PJM Interconnection, L.L.C. and New York Independent System Operator, Inc. (Docket Nos. ER08-858-000, -001, ER08-867-000, -002); Consolidated Edison Company of New York, Inc. v. Public Service Electric and Gas Company, PJM Interconnection, L.L.C. and New York Independent System Operator, Inc. (Docket Nos. EL02-23-000, -014).
On February 23, 2009, PJM Interconnection, L.L.C. (PJM)— on behalf of the New York Independent System Operator, Inc. (NYISO), Consolidated Edison Company of New York (ConEd), Public Service Electric and Gas Company (PSE&G), PSE&G Energy Resources & Trading LLC and the New Jersey Board of Public Utilities—filed a Settlement Agreement regarding issues involving two grandfathered service agreements between ConEd and PSE&G and the proposed roll over of the agreements under the PJM OATT. The Settlement Agreement was contested by the NRG Companies (NRG) and FERC Trial Staff. On February 19, 2010, FERC issued an order stating that it was unable to approve the Settlement Agreement on the basis of the existing record and ordered the parties to brief issues regarding the roll over of certain long-term contracts and whether the roll over would be unduly discriminatory. NRG requested clarification or, in the alternative, rehearing of this FERC order. Agenda item E-9 may be an order on the Settlement Agreement and/or the rehearing request.
E-10: PJM Interconnection, L.L.C. (Docket Nos. ER05-1410-016, EL05-148-016, ER09-412-011).
On May 20, 2010, FERC accepted a PJM compliance filing regarding PJM’s Reliability Pricing Model capacity market. The compliance filing discussed issues related to the periodic review of the Net Cost of New Entry, whether to require PJM to sell back capacity commitments, and the calculation of prices for capacity in incremental auctions. The Illinois Commerce Commission filed a request for rehearing concerning PJM’s procurement of additional capacity in an incremental auction in situations when PJM would have already procured capacity that exceeds the updated reliability requirement. Agenda item E-10 may be an order on rehearing.
E-11: Exelon Generation Company, LLC (Docket No. ER10-1418-000).
On June 10, 2010, Exelon Generation Company, LLC (Exelon Generation) submitted its proposed Reliability Must-Run Rate Schedule (RMR Rate Schedule) in response to PJM’s request that Exelon Generation continue to operate two generating units (RMR Units) beyond the date on which Exelon Generation proposed to retire the units. The proposed RMR Rate Schedule establishes (i) the terms and conditions under which PJM may dispatch, and Exelon Generation will operate, the RMR Units for reliability purposes during the term of the RMR Rate Schedule and (ii) the Cost of Service Recovery Rate pursuant to the PJM Tariff under which Exelon Generation will recover its costs for operating and maintaining the RMR Units beyond their planned May 31, 2011 deactivation date. Numerous parties intervened in, commented on and/or protested the proceeding. Agenda item E-11 may be an order on Exelon Generation’s filing.
E-12: Sagebrush, a California Partnership (Docket Nos. EL10-23-001, -002).
As required by FERC through a series of orders conditioning the market-based rate authorization of several affiliates of Sagebrush, a California Partnership (Sagebrush), on December 7, 2009, following receipt of a third-party request for transmission service, Sagebrush filed an OATT to govern the terms of new interconnection and transmission service on its existing transmission line (the Line), a 46-mile, 230 kV radial transmission facility used to deliver power from a number of QFs and EWGs (the Sagebrush Projects) to Southern California Edison Company (SCE). On February 4, 2010, FERC issued an Order Accepting in Part and Rejecting in Part Tariff
Filing and Directing Compliance Filing with respect to the proposed OATT. On March 5, 2010, Sagebrush sought rehearing and clarification of the February 4 order asking FERC to (i) confirm that Sagebrush and the Sagebrush Projects are not subject to additional regulation under the FPA as long as the Line continues to be used only to transmit power from the Sagebrush Projects until a third-party non-QF begins taking service on the Line; (ii) clarify the additional regulations that would apply once a third-party non-QF begins taking service on the Line; (iii) affirm that the pre-approvals and waivers granted to QFs and EWGs and which Sagebrush requested will apply after a third-party non-QF begins taking service on the Line; and (iv) affirm that Sagebrush qualifies for waiver from the requirements of the Standards of Conduct. Sagebrush further requested rehearing of FERC’s finding that Sagebrush (i) is required to establish an Open Access Same- Time Information System (OASIS); (ii) must file a Schedule 11, FERC Annual Charges Recovery; and (iii) actually received a “completed application” for transmission service as that term is defined in the pro forma OATT. On April 5, 2010, Sagebrush submitted its revised OATT as required by the February 4 order and on April 9, 2010, Sagebrush submitted a Supplemental Request for Clarification solely with respect to implementation of FERC’s OASIS requirements. Agenda item E-12 may be an order on rehearing and clarification and/or on the revised OATT.
E-13: Louisiana Public Service Commission and the Council of the City of New Orleans v. Entergy Corporation (Docket No. EL00-66-012).
On November 19, 2007, in compliance with a September 20, 2007 order, Entergy Services, Inc. (Entergy) submitted its Refund Report containing a summary of calculations and refund amounts during the period April 1, 2004 through March 31, 2005 and a summary of calculations and refund amounts during the 15-month refund period of May 14, 1995 through July 13, 1996 with respect to certain calculations under the Entergy System Agreement. Several parties intervened and/or protested the Refund Report. Agenda item E-13 may be an order regarding the refunds.
E-14: Tres Amigas LLC (Docket No. EL10-22-001).
On March 18, 2010, FERC issued an order on Tres Amigas LLC’s (Tres Amigas) petition requesting that FERC disclaim jurisdiction over prospective transmission facilities that would interconnect the Electric Reliability Council of Texas (ERCOT) grid with the proposed Tres Amigas project in New Mexico. The proposed project would build a three-way alternating current/direct current transmission interconnection station that would connect the Eastern Interconnection, the Western Electricity Coordinating Council and ERCOT. FERC denied the requested blanket authorization. Several parties requested rehearing of the March 18 order. Agenda item E-14 may be an order on the requests for rehearing.
E-15: Tres Amigas LLC (Docket No. ER10-396-001).
On March 18, 2010, FERC issued an order granting Tres Amigas request for authorization to charge negotiated rates for transmission service on its proposed merchant transmission project. The proposed project would build a three-way alternating current/direct current transmission interconnection station that would connect the Eastern Interconnection, the Western Electricity Coordinating Council and ERCOT. Several parties sought rehearing of the March 18 order. Agenda item E-15 may be an order on rehearing.
E-16: Southwest Power Pool, Inc. (Docket No. ER09-1039-001).
On June 18, 2009, FERC conditionally approved the Southwest Power Pool, Inc.’s (SPP) proposal to modify its base plan funding eligibility requirements and related cost allocation methodology for network upgrades associated with the designation of wind resources as network resources. FERC directed SPP to submit within one year of the June 18 order a study regarding (i) operational challenges due to integration of wind resources in its system and (ii) whether the proposed limit on base-plan funding eligibility of up to 20 percent of the customer’s system peak responsibility places transmission customers with smaller loads at a competitive disadvantage with customers serving larger loads with dedicated wind resources. On June 10, 2010, SPP filed the required informational study. Agenda item E-16 may be an order regarding the study.
E-17: Southwest Power Pool, Inc. (Docket Nos. ER09-1050-003 and ER09-1192-000).
On February 18, 2010, SPP filed changes to provisions of its OATT relating to market monitoring in compliance with requirements in Order No. 719. Agenda item E-17 may be an order on SPP’s proposed revisions.
M-1: Enforcement of Statutes, Regulations and Orders (Docket No. PL10-4-000).
On March 18, 2010, FERC issued a Policy Statement on Penalty Guidelines with the goal of providing fairness, consistency and transparency to the process of assessing penalties in its enforcement program. FERC modeled the Penalty Guidelines on the United States Sentencing Guidelines, modified as needed for FERC-specific considerations. On April 15, 2010, FERC suspended the Penalty Guidelines in order to open the Policy Statement to public comment before issuing a final order and putting the Penalty Guidelines into effect. Agenda item M-1 may be a final order on the Penalty Guidelines.
H-1: Appalachian Power Company (Docket No. P-2210-192).
On December 15, 2009, the Director of FERC’s Office of Energy Projects issued an Order Issuing New License for the continued operation and maintenance of the Smith Mountain Pumped Storage Project, a 636 MW project located on the headwaters of the Roanoke River in Virginia, effective April 1, 2010. On January 14, 2010, the Tri-County AEP Relicensing Committee (consisting of the four counties in which the project is located) filed a request for rehearing of the December 15 order arguing that the new license will affect the environmental quality and economy of the headwaters of the Roanoke River through the year 2040. Agenda item H-1 may be an order on rehearing.
H-2: Public Service Company of Colorado (Docket No. P-400-054).
On May 19, 2010, the Director of FERC’s Office of Energy Projects issued an Order Issuing New License for the continued operation and maintenance of the Ames Hydroelectric Project, a 3.5 MW project, effective July 1, 2010. On June 18, 2010, Public Service Company of Colorado filed a Motion to Stay License and Request for Rehearing. Agenda item H-2 may be an order on the motion to stay and/or request for rehearing.
H-3: City of Broken Bow, Oklahoma (Docket No. P-12646-012).
On May 12, 2010, HISINC, L.L.C. (HISINC), on behalf of the City of Broken Bow, filed a request for a stay of license for the Pine Creek Lake Dam Hydropower Project. HISINC asserted that the dam has been placed in a high-risk category due to stability issues and that the US Army Corps of Engineers cannot approve any modification of the conduit until a detailed risk assessment and dam safety modification study is completed. HISINC reported that it may take years to complete the necessary studies. Agenda item H-3 may be an order addressing the request for a stay of license.
H-4: Update of the Federal Energy Regulatory Commission’s Fees Schedule for Annual Charges for the Use of Government Lands (Docket No. RM10-27-001).
On August 19, 2010, the FERC Federal Land Use Charges Group (FLG) submitted a request for rehearing of a July 20, 2010 final rule issued by FERC (July 2010 Rule) which sets forth FERC’s 2010 fee schedule for federal land use annual charges assessed under Section 10(e)(1) of the FPA. FLG argued that the July 2010 Rule violates Section 553 of the Administrative Procedure Act because FERC did not provide for notice and comment or provide good cause for its failure to do so. FLG also contended that the July 2010 Rule violates Section 10(e)(1) of the FPA because FERC did not find that the new 2008 FS-BLM Methodology would establish reasonable annual charges and would not unduly increase consumers’ electric costs. In addition, FLG requested that FERC immediately stay the effectiveness of the July 2010 Rule during FLG’s challenge to the July 2010 Rule, including any subsequent judicial review. Agenda item H-4 may be an order related to request for rehearing and/or the request for stay.
C-1: Kern River Gas Transmission Company (Docket No. CP10-14-000).
On November 2, 2009, Kern River Gas Transmission Company (Kern River) filed an abbreviated application for i) authorization to construct and operate certain compression and pipeline facilities, with appurtenances, to expand the capacity of Kern River’s pipeline system; ii) approval of regulatory asset/liability accounting for differences between book and regulatory depreciation resulting from use of Kern River’s levelized rate design; iii) approval of incremental transportation rates and fuel factors; and iv) acceptance of pro forma tariff sheets. Kern River stated that authorization of the construction, ownership and operation of the facilities would permit it to expand its year-round, firm transportation capacity from existing receipt points in Lincoln County, Wyoming, to the Pecos delivery point in Clark County, Nevada by 266,000 Dth/d. Agenda item C-1 may be an order addressing the application.
C-2: Texas Gas Transmission, LLC (Docket No. CP10-255-000).
On April 29, 2010, Texas Gas Transmission, LLC (Texas Gas) filed an application pursuant to Section 7 of the Natural Gas Act to amend the certificates related to eight of its storage fields to make them consistent with each field’s current operating characteristics. Texas Gas indicated that it conducted a review of its storage operations and discovered that eight of these fields’ actual operating characteristics were different from the operating parameters approved by FERC during Texas Gas’s restructuring or certificated thereafter. Texas Gas stated that the amendments will allow Texas Gas to provide additional storage capacity to the market consistent with the demonstrated capabilities of each storage field. Agenda item C-2 may be an order addressing the application.
C-3: El Paso Natural Gas Company (Docket No. CP10-470-000).
On July 12, 2010, El Paso Natural Gas Company (EPNG) submitted an application for a certificate of public convenience and necessity authorizing the construction and operation of replacement pipeline segments across the San Francisco River in Greenlee County, Arizona. In its application, EPNG proposed to replace segments of its Station No. 7 to Morenci Line, Station No. 7 to Morenci Loop Line, and Station No. 7 to Morenci 2nd Loop Line (Line 2083) where they cross the San Francisco River in Greenlee County, Arizona. EPNG indicated that Line No. 2083 is exposed where it crosses the San Francisco River and needs to be replaced to maintain safe operation of EPNG’s pipeline system. Agenda item C-3 may be an order addressing the application.
C-4: Empire Pipeline, Inc. (Docket No. CP10-136-000).
On February 2, 2010, Empire Pipeline, Inc. (Empire) submitted an application to amend its Presidential Permit and NGA Section 3 Authorization such that, in addition to importing natural gas at the US/Canada border, Empire can also export gas into Canada through its previously authorized border facilities. Empire indicated that it recently began receiving requests for firm transportation service from primary receipt points in the Untied States to a primary delivery point at its interconnection with TransCanada Pipelines Limited (TransCanada) at the Untied States/Canada border. Empire’s proposal included modifications to TransCanada’s metering and regulating facilities on Canadian soil, however, the application did not propose any amendment to Empire’s border facilities. Agenda item C-4 may be an order addressing the application.
C-5: Iroquois Gas Transmission System, L.P. (Docket No. CP10-433-000).
On May 17, 2010, Iroquois Gas Transmission System, L.P. (Iroquois) submitted an application for an amendment to the authorization under NGA Section 3 and reissuance of the Presidential Permit granted to Iroquois to authorize Iroquois to utilize its existing cross-border facilities for both imports of natural gas from Canada to the United States, which are permitted under its current authorization, and exports of natural gas form the United States to Canada. Iroquois indicated that it recently constructed facilities that permit it to receive natural gas deliveries in the United States from Algonquin Gas Transmission, LLC. Iroquois also indicated that with the anticipated development of US shale gas production in areas proximate to its interstate pipeline, Iroquois expects that additional supplies of US gas are likely to enter its system, which will expand the opportunities for export to Canadian markets. Agenda item C-5 may be an order addressing the application.
C-6: Bison Pipeline LLC (Docket No. CP09-161-001).
On May 7, 2010, Bison Pipeline LLC (Bison) submitted a request for clarification, or in the alternative, rehearing of the FERC’s Order Issuing Certificate which authorized Bison to construct and operate a new pipeline, compressor station and other appurtenant facilities designed to transport natural gas from the Dead Horse region near Gillette, Wyoming, to an interconnection with Northern Border Pipeline Company in Morton County, North Dakota. Among other things, Bison argued that FERC erred in i) concluding that it was unable to determine the extent to which the maximum pressure cap provision in the Foundation Shipper Precedent Agreement would affect the quality of service provided to Bison’s shippers and whether this provision would be permissible; ii) determining the proposed Foundation Shipper provision regarding limitation of liability must be either removed from the Service Agreement or included in Bison’s FERC Gas Tariff to be applicable to all shippers; and iii) determining that it was unable to assess whether some or all of the provisions contained in Articles 10.2 through 10.5 of the Cornerstone Shipper Rate Schedule FT-1 Service Agreement constitute a material deviation affecting the terms and conditions of service and whether the provisions would be permissible. Agenda item C-6 may be an order addressing the request for clarification or rehearing.