FERC, CFTC, and State Energy Law Developments
FERC recently issued a notice of proposed rulemaking (NOPR) to expand the existing duty of candor rule by adding a requirement in 18 CFR Part 1 that any entity communicating with FERC or other specified organizations related to a matter that is subject to FERC’s jurisdiction must submit accurate and factual information and must not submit false or misleading information or omit material information. However, exercising due diligence to prevent the submission of false or inaccurate information would be an affirmative defense to violations of the requirement.
FERC recently held a Staff-led technical conference to discuss whether, and if so, how, the Commission should require additional financial assurance mechanisms in the licenses and other authorizations it issues for hydroelectric projects, to ensure that licensees have the capability to carry out license requirements and, particularly, to maintain their projects in safe condition. The feedback received during the conference, as well as the comments to be filed, will likely shape the ultimate FERC rule on financial assurance requirements currently under consideration.

Cost allocation for regional transmission projects has long been one of the more challenging aspects of regional transmission development because it determines who should ultimately bear the costs of the regional transmission projects and in what proportion. Litigation over these issues is not uncommon.

FERC believes that barriers to transmission investment pose significant risks to the energy economy. Inadequate transmission can lead to transmission congestion, which in turn impedes capital investment in energy infrastructure and the facilities necessary to ensure reliable and efficient service. That problem is compounded by changing supply and demand conditions and an increasingly diverse generation mix, which can create ripple effects on competitive wholesale markets.
According to FERC, one of the biggest shortcomings of existing regional transmission planning is its focus on short-term needs. Long-term planning, while part of planning processes today, is not sufficient in FERC’s view and has led to “piecemeal” transmission development and an overreliance on meeting transmission needs through generator interconnection processes, which are not designed with larger regional facilities in mind.

The Federal Energy Regulatory Commission recently issued a final rule, Order No. 880, revising its hydropower project inspection and safety regulations. The updates revise part 12 of FERC’s regulations and conclude an approximately year and a half of rulemaking in Docket No. RM20-9.

At its December 2021 open meeting, the Federal Energy Regulatory Commission (FERC or the Commission) approved new rules to improve utilization of the transmission system by redefining “transmission line rating” to account for ambient weather conditions. The Commission expects that the change will permit greater transmission line utilization while also fostering reliability and safety. Transmission providers have 120 days to submit a compliance filing to account for the redefinition and must implement all requirements within three years of the compliance filing due date.
The US Environmental Protection Agency (EPA) recently issued a proposed rule under the Clean Act intended to reduce emissions of greenhouse gases (GHGs) and air pollutants from crude oil and natural gas operations (production, processing, transmission, and storage segments).

US President Joseph Biden signed an executive order on August 5 that underscores his stated commitment to encourage the development and deployment of electric vehicles (EVs) as part of the Biden-Harris administration’s clean energy agenda. The executive order, Strengthening American Leadership in Clean Cars and Trucks, aims to increase the production of zero-emission vehicles by 2030 and directs new pollution and fuel economy standards for light‑, medium-, and heavy-duty vehicles for model years 2027 and later. President Biden’s issuance of the executive order, combined with the EV-related implications of various provisions in the draft infrastructure bill currently pending in Congress, may well serve to facilitate increased deployment of EVs in US markets.

The National Association of Regulatory Utility Commissioners (NARUC) has submitted 10 nominees to FERC to serve on the newly formed Joint Federal-State Task Force on Electric Transmission. Last month in Docket No. AD21-15, FERC issued an order establishing a joint federal-state task force with NARUC to evaluate barriers and solutions to transmission development. The task force will conduct joint hearings on transmission-related issues with a focus on developing ways to plan and pay for new transmission facilities that are best for the public interest.