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Powered by the attorneys of Bracewell & Giuliani, Energy Legal Blog® is your resource for updates and analysis on national and global energy issues.
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  1. FERC Policy Proposal – More Modernization Trackers?

    Friday, November 21, 2014 4:27 pm by and

    At its November 20, 2014 meeting, FERC issued a policy proposal to facilitate the recovery of the costs associated with improving pipeline safety and reducing emissions.  Recognizing the fact that several pipeline safety and environmental initiatives will be facing the natural gas industry in the coming months, FERC suggests that pipelines and customers could work together to develop a tracker (e.g., a surcharge on base rates) that recovers those costs associated with pipeline safety and environmental compliance.  Because a modernization and safety tracker could be developed faster than establishing a cost recovery mechanism through the traditional rate case process, FERC reasons that pipelines may be incentivized to undertake the upgrades.  (more…)


  2. FERC Orders ISOs to Address Fuel Assurance Issues 149 FERC ¶ 61,145 (2014)

    Thursday, November 20, 2014 5:31 pm by

    In an order issued on November 20, 2014, the Federal Energy Regulatory Commission (“FERC” or the “Commission”) directs regional transmission organizations and independent system operators (“ISOs”) to file a report on the status of how their market rules address fuel assurance challenges.  ISOs have 90 days from the date of the Commission’s order to evaluate the specific fuel assurance challenges they may experience and prepare a report that comprehensively describes the actions they have already undertaken, and/or propose to undertake, in response to their unique fuel assurance concerns. (more…)


  3. PJM Sets Out Framework For Continued Participation Of Demand Response In Wholesale Markets Following EPSA

    Friday, October 10, 2014 2:35 pm by

    On October 7, 2014, PJM Interconnection, L.L.C. (“PJM”) filed with the Federal Energy Regulatory Commission (“FERC”) a blueprint for the continued participation of demand response resources in its markets in the wake of the United States Court of Appeals for the D.C. Circuit’s decision in Electric Power Supply Ass’n v. Fed. Energy Reg. Comm’n, 753 F.3d 216 (D.C. Cir. 2014) (“EPSA”).  In that case, the D.C. Circuit vacated Order No. 745, FERC’s rule governing the compensation of demand response resources in wholesale energy markets on the basis that the rule encroached upon state jurisdiction over retail sales.  The court’s opinion casts significant doubt on FERC’s authority to require transmission providers to allow demand response to participate in their markets, with some wondering whether there is any room left for demand response in wholesale markets at all.  (more…)


  4. FERC Issues Another Notice of Alleged Violations Concerning Up To Congestion Trades

    Wednesday, August 27, 2014 2:29 pm by

    On August 25, 2014, staff at the Federal Energy Regulatory Commission (FERC Enforcement)  issued a Notice of Alleged Violations (NAV) against City Power Marketing, LLC, and its principal owner, K. Stephen Tsingas.  The Notice said that FERC Enforcement has preliminarily determined that City Power and Tsingas violated the Commission’s Anti-manipulation rule through Up To Congestion (UTC) trading in the PJM market.  FERC Enforcement has defined UTC as “a virtual product that earns or loses money on the change between the Day ahead market and the Real time market of the spread in prices between two price nodes in PJM’s system.”  See Preliminary Findings of Enforcement Staff’s Investigation in Powhatan Energy Fund, LLC, http://ferclitigation.com/wp-content/uploads/0005-FERC-Preliminary-Findings-August-9-2013-2002899_1.pdf.  FERC Enforcement also alleged that City Power made false statements and omitted material information during the investigation.  (more…)


  5. D.C. Circuit Affirms FERC on Order No. 1000

    Monday, August 18, 2014 5:15 pm by

    On August 15, 2014, the U.S. Court of Appeals for the D.C. Circuit (D.C. Circuit) issued an opinion in South Carolina Public Service Authority v. FERC, Case Nos. 12-1232, et al. (consolidated), upholding the Federal Energy Regulatory Commission’s (FERC) Order No. 1000 in its entirety, giving FERC a major win in a case involving 45 petitioners and 16 intervenors.

    Authority to Require Participation:  In Order No. 888 in 1996, FERC required public utility transmission providers to functionally unbundle their wholesale generation and transmission services and file open-access transmission tariffs to provide non-discriminatory transmission service and to provide the benefits of competitively priced generation.  Previously, the D.C. Circuit upheld Order No. 888 in nearly all respects.  In this opinion, the D.C. Circuit affirmed FERC’s conclusion that transmission planning affects transmission rates and that FERC has authority under Section 206 of the Federal Power Act (FPA) to require transmission providers to participate in a regional planning process.  The Court expressed its view that such a requirement is simply the next step in reforms that began with Order No. 888.  The Court also concluded that the statutory directive for “voluntary interconnection and coordination” found in Section 202(a) of the FPA does not bar FERC from requiring regional planning and that Order No. 1000 does not interfere with traditional state authority. (more…)


  6. FERC Alleges PJM Manipulation by Powhatan

    Wednesday, August 6, 2014 9:26 am by

    On August 5, 2014, the Federal Energy Regulatory Commission’s (FERC) Secretary, at the direction of the Division of Enforcement, issued a Notice of Alleged Violations against Powhatan Energy Fund, LLC, a hedge fund owned by brothers Kevin and Richard Gates.  In the Notice, FERC Enforcement alleged that Powhatan’s trader, Dr. Houlian Chen, engaged in Up to Congestion trades in the PJM market that allegedly were the equivalent of wash trades in violation of FERC’s anti-manipulation rule.  FERC’s Notices generally reveal little about the matter under investigation.  However, in this case we know a great deal about Enforcement’s case because Powhatan itself publically disclosed much of the investigative record.  See http://ferclitigation.com/legal-back-and-forth/.  It has been Powhatan’s contention that their actions have been transparent and fully consistent with the PJM tariff and FERC’s rules.  Nevertheless, in staff’s preliminary findings, dated August 9, 2013, Enforcement alleged that Chen made the wash trades in order to capture millions of dollars from the Margin Loss Surplus Allocation (MLSA).  FERC alleged that Powhatan entered the riskless trades in order to boost the volume of its trading thus increasing the MLSA payments.  (more…)


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