Energy Legal Blog

Baltimore Gas & Electric (BG&E) won Maryland PSC approval late Friday for an $833 million smart grid plan pursuant to which it will install 3,000 smart meter devices per day through 2014. Without timely PSC approval, BG&E risked losing approximately $200 million in Department of Energy subsidies to implement the plan.

The PSC rejected BG&E’s original plan, which included the large-scale build-out of advanced meters and mandatory time-of-use (TOU) billing because the PSC opposed (1) granting BG&E a rate tracker to recover smart grid costs as they are incurred as opposed to following a prudence determination, and (2) imposing TOU rates on all retail customers. The PSC also faulted the original BG&E proposal as doing too little to educate customers on how smart grid programs would work. The PSC nevertheless invited BG&E to resubmit its proposal to address these concerns. (more…)

After designating two bilateral Mid-Columbia (Mid-C) electricity contracts traded on the Intercontinental Exchange (ICE) as significant price discovery contracts (SPDC), the Commodity Futures Trading Commission (CFTC), in July 9th orders, designated four additional ICE electricity contracts used in organized Regional Transmission Organization (RTO) markets as SPDCs.  The four contracts are the SP-15 Financial Day-Ahead LMP Peak (SPM) and SP-15 Financial Day-Ahead LMP Off-Peak (OFP) contracts for the California ISO and the PJM Western Hub Real Time Peak (PJM) and PJM Western Hub Real Time Off-Peak (OPJ) contracts for the PJM Interconnection.  SPDC designation subjects these contracts to heightened regulatory oversight and reporting requirements.  At the same time, the CFTC issued two other orders finding that two daily SP-15 and two daily PJM contracts were not SPDCs.  (more…)

The Federal Energy Regulatory Commission (FERC) on June 17 proposed a rulemaking that, if implemented, has the potential to complete the opening of the transmission grid, an undertaking that began fourteen years ago. Earlier reforms, starting with FERC’s Order No. 888 in 1996, offered for the first time non-discriminatory open access to those who sought to interconnect with and use the grid.  In 2007 Order No. 890 expanded customer participation in the planning and operation of the grid. The new rule proposes to allow all power industry participants to contribute equally to the future design, configuration, and even ownership of the grid.  Public comments on the proposed rulemaking must be submitted to the agency by August, 30, 2010. (more…)

FERC last week launched an effort to raise the price cap in the Western Electricity Coordinating Council (WECC) spot power markets from $400/MWh to $750/MWh, which would align it with the bid cap in place in the California Independent System Operator Corporation (CAISO) spot markets.  Comments on FERC’s proposal are due by June 21, 2010. (more…)

One month after the California PUC (CPUC) in a March 11 order authorized the use of a new form of renewable energy certificate — the tradable renewable energy certificate (TREC) — CPUC Chairman Peevey announced that the agency may consider scrapping the program altogether. These second thoughts reflect the tensions that played out during the nearly 3-year rulemaking between the utility desires for a liquid REC market and the state’s more parochial interest to site generation in-state. (more…)

FERC proposes to revisit credit practices and risk management for organized wholesale market in a January 21 rulemaking proposal.  The seven proposed revisions across the board would reign in credit and reduce the default exposure of market operators beginning before the 2010-2011 winter-heating season.  Public comment on the proposed revisions must be filed with the FERC by March 29, 2010. (more…)