Power & Pipes

FERC, CFTC, and State Energy Law Developments

On March 18, 2010, the Federal Energy Regulatory Commission (FERC or the Commission) issued several orders that portend a significant expansion of FERC control over the development and drafting of mandatory Reliability Standards By the North American Electric Reliability Corporation (NERC). On June 11, FERC denied requests for rehearing of one of these orders, which had directed NERC to propose By June 30, 2010, modifications to Reliability Standard TPL-002-0, to prevent transmission planners from planning to permit the loss of nonconsequential load under single contingency conditions. However, FERC granted an extension of time until March 31, 2011 for the requested modification, and clarified that the modification may permit transmission planners to plan for the loss of firm service at the fringes of their system, so long as these exceptions are technically justified and case-specific.

NERC and others had challenged FERC’s March 18 order, arguing that it does not allow NERC to develop alternatives, that it threatens to impose costs that far exceed the benefit to bulk electric system reliability, and that it fails to give “due weight” to the technical expertise of NERC as required By the Federal Power Act. The Commission rejected all of these arguments.  Read more…