Below are brief summaries of the agenda items for the Federal Energy Regulatory Commission’s February 18, 2010 meeting. Agenda items E-4, E-5, E-6, E-7, E-8, E-9, E-10, E-11, E-12, E-15, E-16 and E-19 are not summarized as they have been omitted from FERC’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.
E-1: Southern California Edison Company (Docket Nos. ER08-375-000, ER08-375-001)
On December 21, 2007, Southern California Edison Company (SoCal Edison) filed revisions to its Transmission Owners Tariff (TO Tariff) to incorporate proposed changes to its transmission revenue requirement and transmission rates in order to implement Construction Work In Progress rate incentives for three transmission projects. By order dated February 29, 2008, FERC accepted SoCal Edison’s proposed tariff revisions to be effective March 1, 2008, suspended them for a nominal period, and made them subject to refund and to the outcome of a paper hearing. In the February 29 order, FERC gave all participants an opportunity to address whether FERC’s preliminary analysis of SoCal Edison’s proposed overall return on equity was within the upper end of the zone of reasonableness. Several parties filed initial and reply briefs. In addition, the California Public Utilities Commission filed a request for rehearing of the February 29 order. Agenda item E-1 may be an order on the paper hearing and/or an order on rehearing.
E-2: California Independent System Operator Corporation (Docket Nos. ER10-300-000, ER06-615-000)
On November 20, 2009, the California Independent System Operator Corporation (CAISO) filed a proposed convergence bidding design policy in which it proposed to allow convergence bidding at the nodal level. CAISO did not file tariff language to implement convergence bidding, but stated that it expected to be able to do so within a few weeks after FERC issues its order on its November 20 filing. Several parties filed comments on and protests of CAISO’s November 20 filing. Agenda item E-2 may be an order addressing CAISO’s convergence bidding proposal.
E-3: PJM Interconnection, L.L.C. (Docket No. EL09-68-000); Demand Response Competition in Organized Wholesale Electric Energy Markets (Docket No. RM10-17-000)
On August 26, 2009, PJM Interconnection, L.L.C. (PJM) filed proposed pro forma tariff revisions to strengthen demand response and to facilitate the transition to price responsive demand at the retail level, which would ultimately lead to the elimination of wholesale demand response programs as unnecessary. In the August 26 filing, PJM proposed three general changes to the way in which demand response is compensated under PJM’s rules. Several parties filed comments on and protests of the August 26 filing. Docket No. RM10-17-000 is a new rulemaking docket. Agenda item E-3 may be an order addressing PJM’s August 26 filing and/or an order initiating a new rulemaking proceeding on demand response compensation in organized wholesale electric energy markets.
E-13: Standards for Business Practices and Communication Protocols for Public Utilities (Docket No. RM05-5-018)
On November 24, 2009, FERC issued Order No. 676-E, in which it revised its regulations to incorporate by reference the latest version of certain business practice standards adopted by the Wholesale Electric Quadrant of the North American Energy Standards Board (NAESB). The revised business standards modified NAESB’s Commercial Timing Table and Transmission Loading Relief Standards to provide clarity and align NAESB’s business practice standards with the reliability standards adopted by the North American Electric Reliability Corporation. The business standards also amended certain ancillary services definitions appearing in the Open Access Same-Time Information Systems standards related to the inclusion of demand response resources as potential providers of ancillary services. On December 22, 2009, Southern Company Services, Inc. (Southern Company) filed a request for rehearing of Order No. 676-E. Agenda item E-13 may be an order addressing Southern Company’s request for rehearing.
E-14: Vermont Electric Cooperative, Inc. (Docket No. ER10-503-000)
On December 23, 2009, Vermont Electric Cooperative, Inc. (VEC) filed a request for a limited, one-business-day waiver of a specific section of ISO New England’s (ISO-NE) Market Rule 1 which requires all existing market participants with real-time demand response resources to submit an updated plan no later than five business days after ISO-NE publishes the demand response operable capacity analysis for any Forward Capacity Market. VEC explained that it misunderstood the due date for the updated plan, and that the waiver would remedy VEC’s inability, absent the grant of the requested limited waiver, to have its demand response operable capacity considered in ISO-NE’s upcoming 2013-2014 forward capacity auction. Agenda item E-14 may be an order addressing VEC’s motion for limited waiver.
E-17: Corporation Commission of the State of Oklahoma v. American Electric Power Company, Inc., American Electric Power Service Corporation and Public Service Company of Oklahoma (Docket Nos. EL08-80-001, EL08-80-003)
On August 11, 2008, the Corporation Commission of the State of Oklahoma filed a complaint against American Electric Power Company, Inc., American Electric Power Service Corporation (AEP), and Public Service Company of Oklahoma alleging that AEP violated the AEP System Integration Agreement (System Agreement) and the AEP West Operating Agreement by improperly deviating from the trading margin allocation methods set out in each agreement. On November 26, 2008, FERC issued an order finding that AEP violated the System Agreement and directed AEP to recalculate and reallocate trading margins in compliance with the System Agreement and to issue refunds. Parties filed requests for rehearing of the November 26 order. Subsequently, on January 26, 2009, AEP filed a refund report pursuant to the November 26 order. Agenda item E-17 may be an order on rehearing and/or an order on AEP’s refund report.
E-18: Google Energy LLC (Docket Nos. ER10-468-000, ER10-468-001)
On December 23, 2009, Google Energy LLC (Google) filed an application for market-based rate authority and a request for waivers and blanket authorizations for Google to make sales of electric energy, capacity and ancillary services at market-based rates. Google requested acceptance of a proposed market-based rate tariff pursuant to which it would engage in wholesale electric power and energy transactions as a marketer. On January 19, 2010, Google submitted clarifying amendments to its December 23 application. Agenda item E-18 may be an order addressing Google’s application for market-based rate authority and request for waivers and blanket authorizations.
E-20: ISO New England Inc. (Docket No. ER09-1424-002)
On October 19, 2009, Dominion Resources Services, Inc. (Dominion) and the PSEG Companies (PSEG) filed a request for rehearing and clarification and a request for rehearing, respectively, of FERC’s September 18, 2009 Order on Informational Filing (September Order). The September Order involved ISO-NE’s informational filings which included reports regarding the qualification of capacity resources to participate in the third Forward Capacity Auction for the 2012 – 2013 Capacity Commitment Period and the de-list bids that those resources submitted. The informational filing set forth the list of de-list bids that ISO-NE determined should be rejected from participation in the October 5, 2009 Forward Capacity Auction, including the static de-list bids submitted by the four resources at Dominion’s Salem Harbor Station on the basis that the de-list bids were inconsistent with those unit’s Going-Forward Costs. Dominion argued that FERC erred in assuming that Salem Harbor’s three-year depreciation period would improperly guarantee capital cost recovery under the Forward Capacity Market rules and by failing to adequately consider substantial record evidence regarding the useful economic life of the Salem Harbor Units in accepting ISO-NE’s extended depreciation periods. In the event that FERC denies rehearing, Dominion also requested clarification that the September Order does not preclude consideration of the useful economic life of a Unit in determining an appropriate depreciation period for capital costs associated with de-list bids. PSEG argued that FERC erred by finding that the “combination” Going Forward Costs rates that were determined for the purpose of compensating the units for providing reliability services did not “unfairly…place on Dominion the risk” of recovering its costs of operating and that such rates were just and reasonable. PSEG also claimed that by modifying the existing ISO-NE tariff under FPA Section 206 to eliminate the possibility of the Salem Harbor Units being paid a rate reflecting a full allocation of common costs to a single unit if a combination of units is needed for reliability on the basis that a single unit rate would result in cost “over-recovery.” PSEG also requested that the FERC clarify or modify its order on rehearing to specify that the economic life of a unit could reasonably supply the basis for determining an amortization period used to calculate depreciation for its Going Forward Costs rate. Agenda item E-20 may be an order addressing the requests for rehearing and clarification.
E-21: Glenns Ferry Cogeneration Partners, Ltd. (Docket Nos. EL10-21-000, QF93-159-008)
On December 1, 2009, Glenns Ferry Cogeneration Partners, Ltd. (Glenns Ferry) filed a petition for recertification as a qualifying cogeneration facility (QF) and for limited waiver for 2009 of FERC’s QF operating and efficiency standards. In 2008, Glenns Ferry was granted a limited waiver of the QF operating and efficiency standard requirements since the thermal host for Glenns Ferry’s Facility, Idaho Fresh-Pak, Inc., ceased production in late 2007 and therefore eliminated its use of thermal energy from the Facility, making the Facility unable to satisfy the operating and efficiency standard requirements for 2008. In its 2009 petition, Glenns Ferry argued that due in part to the economic downturn, Glenns Ferry has not been able to make definitive arrangements for a replacement thermal host for its Facility. Idaho Power Company filed a Motion to Intervene and Protest. Agenda item E-21 may be an order addressing the petition and request for waiver.
E-22: Green Energy Express LLC (Docket No. EL09-74-001)
On December 23, 2009, Green Energy Express LLC (Green Energy Express) submitted a request for rehearing of FERC’s November 23, 2009 order that granted Green Energy Express’ September 9, 2009 petition for a declaratory order and awarded certain rate incentives for the Green Energy Express Transmission Line Project (GEET Project). Green Energy Express requested that FERC reverse two of its decisions in which it: 1) found that Green Energy Express did not adequately demonstrate that the GEET Project satisfied the requirements of Section 219 of the Federal Power Act by either ensuring reliability or reducing the price of delivered power by reducing congestion and 2) conditioned the grant of recovery of prudently incurred costs, if the GEET Project is cancelled or abandoned for reasons beyond the control of Green Energy Express, upon the GEET Project receiving approval in the CAISO Regional Transmission Planning Process. Agenda item E-22 may be an order addressing the request for rehearing.
G-1: Transcontinental Gas Pipe Line Corporation (Docket Nos. RP01-245-029, RP01-245-030)
On June 29, 2009, Transcontinental Gas Pipe Line Corporation (Transco) submitted a compliance filing and a request for rehearing, or in the alternative, clarification of FERC’s May 29, 2009 Order on Rehearing and Compliance (May Order) which rejected Transco’s January 2008 compliance filing and directed Transco to file tariff sheets. In December 2007, FERC directed Transco to modify its tariff so that shippers taking gas from the Station 85 pool would not incur Zone 4 usage and fuel charges, which would have already been incurred for shipping the same gas to that pooling point. The January 2008 compliance filing established two separate pools at the Station 85 pooling location so that payment of the Zone 4 usage and fuel charges could be identified and transfers of gas between those pools would be restricted in order to prevent the provision of free transportation in Zone 4. In its request for rehearing, Transco argued that FERC’s rejection of its January 2008 compliance filing is unreasonable, arbitrary and capricious and that FERC’s directive requiring Transco to implement a pooling structure that would result in Transco providing transportation in Zone 4, without assessing the minimum applicable transportation usage rate or fuel retainage as stated in Transco’s tariff, is contrary to FERC policy and Transco’s FERC Gas Tariff. Transco also claimed that FERC fails to recognize the fact that Transco must implement time-consuming modifications to its business system in order to ensure that all gas transported on Transco’s Zone 4 mainline facilities is assessed Zone 4 usage and fuel charges only once. Agenda item G-1 may be an order addressing the compliance filing and/or the request for waiver.
G-2: Monroe Gas Storage Company, LLC (Docket Nos. RP09-447-000, RP09-447-003)
On March 10, 2009, Monroe Gas Storage Company (Monroe) submitted its FERC Gas Tariff and six nonconforming service agreements and requested nonpublic treatment of certain provisions in these agreements. On April 14, 2009, FERC issued an order accepting and suspending the nonconforming agreements and tariff sheets, subject to refund and further review. Subsequently, FERC required Monroe to file comments justifying its request for nonpublic treatment of certain provisions in the nonconforming service agreements. Monroe submitted its justification for the proposed nonpublic treatment. FERC ultimately denied continued nonpublic treatment of the un-redacted, nonconforming service agreements. Thereafter, Monroe submitted unredacted, public versions of the nonconforming service agreements. Agenda item G-2 may be an order addressing the nonconforming service agreements and/or the tariff sheets.
G-3: Texas Gas Transmission, LLC (Docket No. RP09-505-002)
On December 18, 2009, Texas Gas Transmission, LLC (Texas Gas) submitted a request for clarification or, in the alternative, request for rehearing of FERC’s November 24, 2009 Order rejecting Texas Gas’ proposed tariff sheets (November Order). The November Order provided that, “[t]o the extent that Texas Gas identifies service agreements that deviate materially from its current pro forma service agreement and which have not been filed with FERC, section 154.112(b) of the Commission’s regulations requires Texas Gas to file those contracts as soon as possible, regardless of any rollover rights.” Texas Gas requested that FERC clarify that this language does not require the filing of service agreements that were consistent with the form of agreement in effect at the time of execution, but that may have become nonconforming because the pro forma service agreement was later modified. In the alternative, Texas Gas sought rehearing of the November Order and asserted that the Order does not reflect reasoned decision-making and is arbitrary and capricious. Agenda item G-3 may be an order addressing the request for clarification or rehearing.
G-4: Statoil Natural Gas LLC and Gazprom Marketing and Trading USA, Inc. (Docket No. RP10-197-000)
On December 1, 2009, Statoil Natural Gas LLC (Statoil) and Gazprom Marketing & Trading USA, Inc. (GMTUSA) filed a joint petition requesting waiver, by February 19, 2010, of FERC’s prohibition on capacity tying and related capacity release bidding requirements. Statoil and GMTUSA seek FERC authorization to enter into and link together a series of related liquefied natural gas (LNG) commodity and pipeline arrangements. These include two LNG Purchase and Sale Agreements, three Prearranged Capacity Leases (two involving capacity on the Dominion Cove Point LNG, LP pipeline and one involving capacity on the Dominion Transmission, Inc. pipeline) and three Prearranged Capacity Releases. Washington Gas Light Company (Washington Gas) filed comments and requested certain conditions to be imposed if FERC granted the requested waiver, such as prohibiting expansion quantities of regasified LNG from being redelivered to Columbia Gas Transmission at Loudon and having the Columbia-Loudon interconnect with Cove Point Pipeline not be an authorized delivery point for the capacity released to GMTUSA. Agenda item G-4 may be an order on the petition for waiver.
G-5: Texas Eastern Transmission LP, Columbia Gulf Transmission Company, Tennessee Gas Pipeline Company, Columbia Gas Transmission, LLC (Docket Nos. RP09-70-004, RP09-275-003, RP09-282-004, RP09-294-003)
On November 16, 2009, Hess Corporation (Hess) requested clarification of FERC’s October 15, 2009 Order on Flow-Through of Discounted or Negotiated Usage and Fuel Charges as it relates to capacity release and selective discounting policies involving asset management and state retail access capacity releases. Hess requested clarification from FERC that, under an asset management agreement or as part of a state retail access program, pipelines are required to treat releasing shippers and replacement shippers as similarly situated when the shippers use: (a) the same individually identified primary and/or secondary points that are designated as specifically eligible for the negotiated/discounted rate per the releasing shipper’s original agreement, or (b) the same secondary points, even if not individually identified, if they are specifically eligible for the negotiated/discounted rate per the releasing shipper’s original agreement. Texas Eastern Transmission, LP and Tennessee Gas Pipeline Company filed Answers requesting that FERC reject the clarification request, and National Grid Gas Delivery Companies filed an Answer in support of the clarification request. Agenda item G-5 may be an order on the clarification request.
H-1: L.S. Starrett Company (Docket No. UL09-1-001)
On November 20, 2009, L.S. Starrett Company (Starrett), the owner and operator of a precision tool manufacturing facility in Massachusetts, timely requested rehearing of FERC’s October 21, 2009 order that ruled that Starrett’s Hydroelectric Project was required to be licensed. Starrett argued that FERC was in error when it ruled that Starrett’s plan to replace a pre-1935 turbine generator at its facility would qualify as “post-1935 construction” that “will affect interstate commerce through its connection to the interstate grid.” Agenda item H-1 may be an order on the request for rehearing.
H-2: Cascade Creek, LLC (Docket No. P-12619-003); City and Borough of Wrangell, Alaska (Docket No. P-13363-001); Petersburg Municipal Power and Light (Docket No. P-13364-001); City of Angoon, Alaska (Docket No. P-13366-001)
On December 7, 2009, the City of Petersburg, Alaska (i.e., Petersburg Municipal Power and Light (Petersburg)) timely requested rehearing of FERC’s November 5, 2009 Order Issuing Preliminary Permit, Denying Competing Applications and Granting Priority to File License Application. On February 2, 2009 (after the close of FERC’s business hours), Petersburg, the City of Angoon (Angoon), the City and Borough of Wrangell (Wrangell), and Cascade Creek LLC each filed an application for a preliminary permit to study the feasibility of the Ruth Lake Hydroelectric Project, to be located in southeast Alaska. Petersburg, Angoon and Wrangell each claimed municipal preference, and FERC held a lottery to determine which one of the municipal applications would, under FERC’s preference rules, be considered first-filed (as all of the applications were considered to be filed at the exact same time since they were all filed after-hours). As the winner of FERC’s lottery among the municipal applicants, Angoon received, as the first-filed applicant, the preliminary permit. Petersburg challenged the awarding of the preliminary permit to Angoon. Agenda item H-2 may be an order on rehearing.
H-3: Virginia Electric Power Company (Docket No. P-2009-128)
On November 24, 2008, Virginia Electric and Power Company, doing business as Dominion North Carolina Power (Dominion), submitted an application and an Environmental Assessment for non-project use of project lands and waters in order to permit East Oaks, LLC to construct a boat forklift pad at Dominion’s commercial marina at the Roanoke Rapids and Gaston Project on Lake Gaston in North Carolina. The Office of Energy Projects has reviewed the application. Agenda item H-3 may be an order on the application.
C-1: Transcontinental Gas Pipe Line Company, LLC (Docket No. CP09-88-001)
On October 19, 2009, Washington Gas timely requested that FERC reconsider or, in the alternative, grant rehearing of its September 17, 2009 Order Denying Protest and Authorizing Construction of two bidirectional interconnects by Transco. These interconnects would allow Transco’s four parallel pipelines in the area to receive regasified LNG from Elba Express Company, LLC’s pipeline facilities. Washington Gas is concerned that these Transco lines can be physically interconnected with gate stations on the Washington Gas system and that this would pose safety concerns related to additional LNG deliveries through Transco’s facilities, negate the operational isolation of Washington Gas’ system from LNG from Transco, and fail to minimize adverse impacts on existing customers. Agenda item C-1 may be an order on rehearing.