On December 3, 2019, FERC denied a challenge filed by Southern Maryland Electric Cooperative, Inc. (“SMECO”) challenging Potomac Electric Power Company’s (“Pepco”) balance of prepaid pension assets (“Prepaid Pension Assets”) included in Pepco’s annual transmission rate update. FERC found that SMECO did not raise any serious doubt about the prudence of the Prepaid Pension Assets and that Pepco’s inclusion of a portion of the Prepaid Pension Assets amount in its rate base was reasonable.…

On November 21, 2019, FERC issued Opinion No. 569, adopting a revised methodology to determine whether an established rate of return on equity (“ROE”) is just and reasonable under Section 206 of the Federal Power Act. Additionally, FERC applied this new methodology to two complaint proceedings involving the base ROEs of Midcontinent Independent System Operator, Inc. (“MISO”) transmission owners (“TOs”). FERC found first that the MISO TOs’ ROE of 12.38 percent in the first complaint…

On September 19, 2019, one Independent and four Democratic Senators wrote a letter to FERC which expressed concerns over recent actions taken by FERC and which directed a series of questions to FERC regarding the “apparent erosion” of FERC’s role in preventing fraud and manipulation in U.S. energy and financial markets (see October 3, 2019 edition of the WER). The concerns expressed by the senators related to (i) the decline in the number of…

On October 24, 2019, FERC denied Harbor Cogeneration Company, LLC’s (“Harbor”) complaint alleging that Southern California Edison Company (“SoCal Edison”) misclassified certain interconnection facilities contrary to FERC’s Order No. 2003 and violated SoCal Edison’s Transmission Owner Tariff (“TO Tariff”) in directly assigning the facility costs to Harbor without FERC “approval.” FERC denied the complaint and rejected Harbor’s request for refunds, reasoning that the charges constituted valid filed rates notwithstanding that FERC did not use the…

On October 17, 2019, FERC issued an order establishing an investigation under Federal Power Act Section 206 into whether ISO New England Inc. (“ISO-NE”), PJM Interconnection, L.L.C. (“PJM”), and Southwest Power Pool, Inc. (“SPP”) (collectively, “Responding RTOs”) may be inconsistently or more expansively implementing Order No. 1000’s immediate need reliability project exemption, which allows Responding RTOs to establish immediate need reliability projects exempt from Order No. 1000’s regional transmission planning competition requirements. In the order,…

On October 8, 2019, FERC accepted ISO New England Inc.’s (“ISO-NE”) public and private versions of a filing containing the de-list bids (“De-List Bids”) and substation auction test prices (“Test Prices”) for the fourteenth Forward Capacity Auction (“FCA 14”), to be held in February 2020 and to become effective August 27, 2019. In the process, FERC also granted ISO-NE’s requested waiver of FERC’s regulations requiring parties requesting privileged treatment of their filings to provide a…