New England – Global Power Law & Policy

Lessons To Be Learned from FERC’s Investigation of a New Power Project’s Participation in the New England Capacity Market

Jul 07 2022

By: Ruta K. Skucas, Kimberly B. Frank, Jennifer L. Mersing

On 28 June 2022, the Federal Energy Regulatory Commission (FERC) issued an order approving a Stipulation and Consent Agreement stemming from an enforcement investigation with Salem Harbor Power Development, LP (Salem Harbor or DevCo) in Docket No. IN18-18. Around a week prior to FERC issuing its Order, grid operator ISO New England, Inc. (ISO-NE) issued a notice to the market regarding the forthcoming settlement, then issued a second statement shortly thereafter. FERC’s Order, and any related forthcoming settlements, illustrate the consequence of failing to exercise the diligence necessary to ensure the accuracy of information reported by a market participant to an independent system operator/regional transmission organization (ISO/RTO), and sends a strong signal regarding the amount of discretion that ISO/RTO staff may exercise in implementing the market rules of its organization’s tariff.

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FERC Finds ISO New England’s Formula Rates and Accompanying Tariff Provisions to be Unjust and Unreasonable

Jan 05 2016

On December 28, 2015, the Federal Energy Regulatory Commission (“FERC”) issued an order pursuant to Section 206 of the Federal Power Act (“FPA”)[1] finding that the ISO New England Inc.’s Transmission, Markets and Service Tariff (“Tariff”) is unjust, unreasonable, and unduly discriminatory or preferential. FERC’s determination was based on a finding that the Tariff lacks formula rate protocols and, by extension, lacks adequate transparency and challenge procedures with regard to the formula rates used by the ISO New England Participating Transmission Owners (“PTOs”).[2] FERC also found that the formula rates themselves may be unjust and unreasonable or otherwise unlawful because the formula rates appear to lack sufficient detail to accurately determine how certain costs are derived and recovered.

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