FERC, CFTC, and State Energy Law Developments
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.
As an example of its renewed focus on dam safety, FERC recently issued an order assessing a $600,000 civil penalty to Ampersand Cranberry Lake Hydro LLC for a violation of Ampersand’s hydro license for the 500 kW Cranberry Lake Project No. 9658. The violation is related to Ampersand’s failure to complete known dam safety repairs over multiple years and its loss of property rights needed for the Cranberry Lake Project, located on the Oswegatchie River in St. Lawrence County, New York.
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In an article featured in our global energy industry newsletter, Empowered, lawyers Carl Valenstein and Jonathan Wilcon analyze the implications of the Jones Act on offshore wind development. While the authors acknowledge that many see Jones Act compliance as a “potential bottleneck” for the offshore wind industry’s progress, they discuss strategies that will permit Jones Act compliance and offshore wind development in the United States.

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.

The Federal Register recently published the US Department of Energy’s (DOE) notice of Request for Information (RFI) seeking public input on energy sector supply chains. The RFI requests that stakeholders provide comment on a wide variety of issues concerning supply chains of energy and related technologies.
US congressional Democrats released the latest version of H.R. 5376—better known as the Build Back Better Act—late last week, hoping to advance a $1.85 trillion spending package after months of deadlock.

FERC recently issued a notice of extension of time further extending, by three months, the compliance dates for FERC’s new market-based rate (MBR) relationship database filing requirements under Order No. 860. This extension follows multiple prior extensions. Meeting these new deadlines is required of all public utilities who either currently hold MBR authority or will request MBR authorization to engage in sales for resale of electric energy, capacity, or ancillary services at marked-based or negotiated rates. Given the complexity of the new reporting requirements, the deadlines extension will provide valuable additional time to entities to prepare their baseline submission.

FERC recently issued an order to show cause and notice of proposed penalty to Ampersand Cranberry Lake Hydro LLC for a violation of Ampersand’s hydro license for the Cranberry Lake Project No. 9658 (Cranberry Lake Project). FERC ordered Ampersand to show cause as to why it should not be found to have violated Article 5 of the project license by failing to retain possession of all project property covered by the license, and to show cause as to why it should not be assessed a civil penalty of $600,000 for that violation.

In a notice issued on September 29, 2021, FERC stated that it did not act on PJM Interconnection LLC’s (PJM’s) proposed reforms to the application of the Minimum Offer Price Rule (MOPR) because the Commissioners are divided two against two as to the lawfulness of the change (Notice). Because FERC did not act within 60 days of PJM’s filing under Section 205 of the Federal Power Act, PJM’s proposal became effective by operation of law. PJM’s revisions “focus” the applicability of the MOPR and will allow certain resources that receive state support to participate in PJM’s capacity auction without being subject to the MOPR, significantly narrowing the scope of the prior rule.