At the March open meeting, FERC issued an order extending the existing deadline for power sellers making sales above the energy price cap in the Western Electricity Coordinating Council (WECC) region. As a result of the order, sellers will have 30 days after the month in which the sales occurred to submit cost justification filings to FERC.
Almost 20 years ago, FERC established a cap on spot market energy sales in the WECC region, outside of the California Independent System Operator markets. Under FERC’s rules, sales above that limit are permitted only if the seller files with FERC a justification of the elevated pricing. Until FERC accepts such a filing, the amount of the sale above the cap is subject to refund. Those justification filings were due within seven days of the end of the month in which the sale in excess of the cap occurred.
The cost cap was initially $250/MWh in 2002, but was subsequently modified to $1,000 MWh in 2010.
In response to requests from sellers explaining the practical difficulty in submitting all the required information within seven days of the end of the month, FERC agreed to extend the filing deadline for all future cost justifications for spot market sales above the cap to 30 days after the end of the month. FERC concluded that the additional time would allow sellers to submit more complete filings supported by settlement data for transactions billed on a monthly cycle. FERC also explained that this would also allow sellers to cover all sales above the cap in a given month in a single filing, rather than making rolling submissions on sales above the cap during the month.