Washington Energy Report

On May 16, 2019, FERC denied several rehearing requests and partially granted clarification of its Order No. 841 regarding the participation of electric storage resources (“ESRs”) in regional markets operated by Regional Transmission Organizations (“RTOs”) and Independent System Operators (“ISOs”) (“Order No. 841-A”).  Most notably, FERC upheld its decision not to adopt a state opt-out of ESR participation in wholesale markets.  Commissioner McNamee issued a partial dissent discussing the need to recognize states’ interests in…
On May 16, 2019, FERC rescinded its policy of issuing public Notices of Alleged Violations (“NAV”) after a subject of an investigation has had an opportunity to respond to Office of Enforcement (“OE”) staff’s preliminary findings (“NAV Policy”).  FERC found that the NAV Policy no longer struck an appropriate balance between the benefit of added transparency and the potential negative impacts that the loss of confidentiality may cause to investigative subjects.…
On May 14, 2019, FERC granted in part, and denied in part, United Illuminating Company’s (“United Illuminating”) request for approval of three transmission rate incentives for investments in the Pequonnock Substation Project (“Project”).  United Illuminating asked FERC to approve three transmission incentives: (i) a 50-basis point return on equity (“ROE”), (ii) an Abandoned Plant Incentive, and (iii) a Construction Work in Progress (“CWIP”) Incentive.  United Illuminating also requested waivers of several of FERC’s regulatory requirements, including…
On May 16, 2019, FERC issued four orders on related complaints against the Midcontinent Independent System Operator, Inc. (“MISO”) by Tilton Energy LLC (“Tilton”), American Municipal Power, Inc. (“AMP”), and Dynegy Marketing and Trade, LLC/Illinois Power Marketing Company (“Dynegy Companies” or “Dynegy”), as well as a complaint against PJM Interconnection, L.L.C. (“PJM”) by AMP and the Northern Illinois Municipal Power Agency (“NIMPA”).  The complaints alleged that MISO’s and PJM’s assessment of congestion and other costs…
On May 3, 2018, FERC accepted revisions proposed by PJM Interconnection, L.L.C. (“PJM”) to its Open Access Transmission Tariff, Amended and Restated Operating Agreement, and Reliability Assurance Agreement Among Load Serving Entities in the PJM Region, to reflect load reductions from Summer-period Demand Response resources in load forecasts for PJM’s capacity market (“Peak Shaving Adjustment”).…
On April 26, 2019, PPL Electric Utilities Corporation (“PPL Electric”) petitioned the United States Court of Appeals for the District of Columbia Circuit (“D.C. Circuit”) for review of two FERC rehearing orders that replaced the cost allocation method by which PJM Interconnection, L.L.C. (“PJM”) assigns responsibility for a portion of costs for certain facilities that address stability-related reliability issues.  Specifically, FERC’s rehearing orders changed the cost allocation method used for certain facilities, including the Artificial…
In the April 27, 2019 edition of the Energy Bar Association’s Energy Law Journal, FERC Commissioner Richard Glick and legal advisor Matthew Christiansen published an article titled “FERC and Climate Change,” describing that the actions of the Commission, as well as the family of federal and state agencies, have “substantial consequences” for climate change.  The authors argue that the threat of climate change does not necessitate “a wholesale reinterpretation of the Commission’s jurisdiction or a…
On May 6, 2019, the Oregon Department of Environmental Quality (“Oregon DEQ”) denied a water quality certification under section 401 of the Clean Water Act (“CWA”) for the proposed Jordan Cove liquefied natural gas (“LNG”) export terminal and its feeder pipeline, the Pacific Connector, to be located on Oregon’s southern coast.…
On May 9, 2019, the U.S. Court of Appeals for the D.C. Circuit (“D.C. Circuit”) dismissed Otsego 2000 Inc.’s (“Otsego”) petition to set aside a FERC order granting a certificate to Dominion Energy Transmission Inc. (“Dominion”) to construct and operate its New Market Project (“Project”).  Specifically, the D.C. Circuit found that Otsego failed to demonstrate standing to petition the court and that Otsego’s expenditure of resources for litigation was insufficient to demonstrate standing.…
As part of its overall proposal to implement carbon pricing to incorporate the social cost of carbon emissions in the wholesale power market, New York Independent System Operator, Inc. (“NYISO”) staff made a presentation at the Market Issues Working Group (“MIWG”) meeting on April 30, 2019 (“MIWG Presentation”).  The MIWG Presentation set forth NYISO’s proposed methodology to calculate the estimated impact of carbon pricing on locational-based marginal prices (“LBMP”).  Specifically, the MIWG Presentation provides additional…