FERC

Subscribe to FERC via RSS
metal structure similar to spaceship interior in blue light

The orders span various sectors and aim to introduce sunset provisions into regulations and eliminate regulations deemed unlawful or anti-competitive.

By Nikki Buffa, Jennifer K. Roy, John Detrich, and Kayla Seltzer

On April 9, 2025, the Trump administration issued three new orders to reevaluate and roll back regulations across various sectors. These orders are a continued step toward implementing the administration’s objective of reducing regulatory burdens on agencies and the public (see our blog post on the…

Beautiful aerial view of meander river with affluents and green vegetation.

We discuss key regulatory trends and strategies to consider when pursing US transmission and interconnection opportunities.

By Tyler Brown, Marc T. Campopiano, and Jennifer K. Roy

Renewable energy production has grown at an exponential clip over the past decade, with continued strong expansion expected because of declining costs, numerous governmental incentives, and long-term decarbonization policies. This trend has driven a tremendous demand for new transmission infrastructure in the US and globally, yet new transmission lines often take years to develop due to regulatory hurdles and litigation challenges.

An unprecedented investment in transmission will be needed over upcoming decades to keep pace with demand and meet decarbonization goals. Companies and investors will need to factor into their strategies these key regulatory trends when pursuing US and global transmission and generator interconnection opportunities.

The split ruling may have broader implications for FERC’s stance toward state-sponsored resources.

By Michael J. Gergen, Tyler Brown, and Peter R. Viola

The Federal Energy Regulatory Commission (FERC) has approved ISO New England Inc.’s (ISO-NE’s) two-stage capacity market proposal, Competitive Auctions with Sponsored Policy Resources (CASPR), by a 3-2 vote, with Chairman Kevin McIntyre and Commissioners Cheryl LaFleur and Neil Chatterjee voting in support, and Commissioners Robert Powelson and Richard Glick voting against. FERC issued an order (CASPR Order) on March 9, 2018, accepting ISO-NE’s proposed tariff revisions largely unchanged. The bulk of the revisions took effect on March 9, 2018 and the remainder will take effect on June 1, 2018.

ISO-NE originally released CASPR as a set of proposed changes to its Transmission, Markets, and Services Tariff in April 2017. (Additional details can be found in this Latham blog post.) Following a series of stakeholder meetings, ISO-NE filed its proposed tariff revisions with FERC in January 2018 pursuant to section 205 of the Federal Power Act (FPA), arguing that the proposed revisions were just and reasonable and not unduly discriminatory. ISO-NE designed CASPR to balance competitive pricing in the organization’s three-year Forward Capacity Market (FCM) with the entry of state-sponsored renewable electric energy resources into the FCM.

Federal Energy Regulatory Commission’s much-anticipated new rule will enhance the participation of electric storage resources in the organized wholesale electricity markets.

By Michael Gergen, David E. Pettit, and Peter Viola

Nearly a year and a half after issuing its original proposal, the Federal Energy Regulatory Commission (FERC or Commission) has unanimously adopted its final rule—Order No. 841—on Electric Storage Participation in Markets Operated by Regional Transmission Organizations and Independent System Operators (Storage Rule). The Storage Rule is the culmination of FERC’s proceedings following the notice of proposed rulemaking issued in November 2016 (Storage NOPR) whereby FERC originally proposed enhancing the participation of electric storage resources in the organized capacity, energy, and ancillary service auction markets operated by Regional Transmission Organizations (RTOs) and Independent System Operators (ISOs).

The Storage Rule recognizes the improving capabilities and cost-competitiveness of electric storage resources (such as batteries, flywheels, pumped-hydro, etc.) and is designed to further pave the way for such resources to participate in the organized wholesale electricity markets alongside conventional energy sources. At the same time, the Commission determined that further information is needed about proposed reforms related to market participation of aggregations of distributed energy resources (DERs) in the RTO/ISO markets. The Commission therefore directed FERC staff to convene a technical conference on April 10-11, 2018 to gather additional information before deciding what action to take on those proposals.

The regional transmission organization’s proposal seeks to reconcile the increasing deployment of state-sponsored subsidized clean energy resources with competitive forward auctions.

By Michael Gergen and Tyler Brown

Proposed New Auction Process in New England

energy pylonThe ISO New England Inc. (ISO-NE), the regional transmission organization serving Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island, and Vermont has filed proposed changes to its Transmission, Markets and Services Tariff with the Federal Energy Regulatory Commission (FERC).  The proposal would create a two-stage capacity auction designed to balance competitive pricing in its three-year Forward Capacity Market (FCM) with the entry of state-sponsored renewable electric energy resources into the FCM. ISO-NE’s proposal, known as Competitive Auctions with Sponsored Policy Resources (CASPR), emerged from the New England Power Pool (NEPOOL)’s Integrating Markets and Public Policy (IMAPP) initiative. IMAPP sought to reconcile states’ efforts to deploy new generation with existing generators’ concerns that resources receiving out-of-market revenues will suppress capacity prices. ISO-NE filed the CASPR proposal on January 8, 2018 even though it fell short of the support it needed to win endorsement by a vote of the ISO’s Participants Committee on December 8, 2017. Stakeholders have until January 29, 2018 to submit comments.

ISO-NE’s existing FCM rules subject new capacity resources to a Minimum Offer Price Rule (MOPR), which requires that subsidized generation resources bid into the FCM’s Forward Capacity Auction (FCA) at their unsubsidized cost. The FCM contains a Renewable Technology Resource (RTR) exemption to the MOPR, which allows for up to 200 MW per year of certain renewable resources to bid into the FCA at their subsidized (i.e., below market) cost. New England state regulators have argued that the MOPR can cause electricity consumers to “pay twice”: once for the cost of capacity that clears in the FCA, and a second time for additional capacity from subsidized resources that did not clear in the FCA (because those subsidized resources were required to bid at their unsubsidized cost).

By Michael Gergen and David E. Pettit

On January 19, 2017, the Federal Energy Regulatory Commission (FERC or Commission) issued a new policy statement entitled “Utilization of Electric Storage Resources for Multiple Services When Receiving Cost-Based Rate Recovery” (Storage Policy Statement or Policy Statement), which clarifies that electric storage resources may receive cost-based recovery for certain services, such as transmission or grid support services, while also receiving market-based revenues for separate services, such as selling electric energy, capacity and ancillary services in the organized wholesale markets, so long as adequate protections are in place to address potential abuses. The Storage Policy Statement suggests potential new revenue opportunities for electric storage resources that can provide multiple or stacked services, some of which are cost-based and some of which are market-based.

Storage Policy Statement Clarifies Prior Precedent

The Storage Policy Statement specifically aims to clarify questions left open by FERC’s prior decisions in Nevada Hydro[1] and Western Grid.[2]  In Nevada Hydro, the Commission rejected a proposal by The Nevada Hydro Company, Inc. to treat an advanced pumped hydroelectric storage project as a transmission facility and allow its costs to be recovered through the California Independent System Operator’s (CAISO) transmission access charge. The company also proposed to have CAISO assume operational control over the project such that CAISO would have to determine when and how to charge and discharge electric energy from the storage project. 

By Michael J. Gergen and Miles B. Farmer

On May 23, 2014, the U.S. Court of Appeals for the D.C. Circuit Court issued a decision in Electric Power Supply Association v. FERC (“EPSA”) vacating and remanding FERC’s Order No. 745, which provides compensation for demand response resources that participate in the energy markets administered by Regional Transmission Organizations (“RTOs”) and Independent System Operators (“ISOs”).  The decision holds that the Federal Energy Regulatory Commission (“FERC” or “Commission”) did not have jurisdiction under the Federal Power Act (“FPA”) to issue Order No. 745 because demand response is part of the retail market, which is exclusively within the states’ jurisdiction to regulate.  Furthermore, the court holds that even if FERC did have jurisdiction under the FPA to issue Order No. 745, the Order would still fail as arbitrary and capricious because FERC failed to properly consider concerns of the petitioner and other parties that Order No. 745 would result in unjust and unreasonable rates because it would overcompensate demand response resources.

By David E. Pettit

Since its decision in American Ref-Fuel Company in 2003, the Federal Energy Regulatory Commission (“FERC”) has taken the view that avoided cost power purchase agreements between a qualifying facility (“QF”) and a utility buyer under the Public Utility Regulatory Policies Act of 1978 (“PURPA”), often referred to as a “PURPA Put Contract,” do not also convey renewable energy certificates (“RECs”) to the utility buyer unless the contract expressly states otherwise.  RECs are state-created and state-issued instruments…

By Daniel Scripps

Affirming its basis for issuing Order 745, “Demand Response Compensation in Organized Wholesale Energy Markets,” the Federal Energy Regulatory Commission (FERC) on December 15, 2011 issued Order 745-A (PDF), denying petitions for rehearing of the original Order, and making only minor clarifications to the requirements of Order 745. As was the case in the original Order, FERC Commissioner Philip Moeller dissented from Order 745-A.

The FERC issued Order 745 (PDF) on…