
[Federal Register Volume 74, Number 102 (Friday, May 29, 2009)]
[Notices]
[Pages 25728-25729]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-12437]


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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Docket No. AD09-7-000]


Material Changes in Facts Underlying Waiver of Order No. 889 and 
Part 358 of the Commission's Regulations; Order Clarifying Requirement 
To Notify Commission of Material Changes in Facts and Allowing 45-Day 
Filing Period for Notifications

Issued May 21, 2009.

    Before Commissioners: Jon Wellinghoff, Chairman; Suedeen G. 
Kelly, Marc Spitzer, and Philip D. Moeller

    1. In Order No. 889,\1\ the Commission directed all public 
utilities that own, control or operate facilities for transmitting 
energy in interstate commerce to provide certain types of information 
regarding their transmission operations on an Open Access Same-time 
Information System (OASIS). The Commission also established Standards 
of Conduct requiring that personnel engaged in transmission system 
operations function independently from personnel engaged in marketing 
functions. In Order No. 889, the Commission stated that it would 
entertain requests for waiver of these requirements on a case-by-case 
basis, and, on a case-by-case basis has granted waivers for certain 
public utilities.\2\ The Commission subsequently revised the Standards 
of Conduct in various proceedings, most recently in Order No. 717, but 
affirmed that public utilities may request a waiver of those 
requirements.\3\ In Order No. 717, the Commission found that any entity 
that has previously received a full or partial waiver of prior versions 
of the Standards of Conduct may continue to rely on that waiver.
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    \1\ Open Access Same-Time Information System and Standards of 
Conduct, Order No. 889, FERC Stats. & Regs. ] 31,035 (1996), order 
on reh'g, Order No. 889-A, FERC Stats & Regs. ] 31,049, reh'g 
denied, Order No. 889-B, 81 FERC ] 61,253 (1997).
    \2\ See, e.g., Black Creek Hydro, Inc., 77 FERC ] 61,232 (1996) 
(Black Creek).
    \3\ See Standards of Conduct for Transmission Providers, Order 
No. 717, 73 FR 63796 (Oct. 27, 2008), FERC Stats. & Regs. ] 31, 280, 
at P 33 (2008), reh'g pending. The Standards of Conduct are 
currently codified in Part 358 of the Commission's regulations.
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    2. It has come to the Commission's attention that some utilities 
may continue to rely on these waivers even after they no longer qualify 
for them. The purpose of this order is to clarify that such reliance is 
inappropriate if there is a material change in the underlying facts on 
which the waiver was granted, and that the Commission must be notified 
when such a change occurs.

Background

    3. In Order No. 889, the Commission acknowledged that it might be 
burdensome for certain small utilities to comply with the rules 
therein, and stated that utilities may seek a waiver of some or all of 
the requirements.\4\ In subsequent orders outside of that rulemaking 
proceeding, the Commission established criteria for granting requests 
for waiver. The Commission held that waiver of Order No. 889 would be 
appropriate for a public utility if it: (1) Owns, operates, or controls 
only limited and discrete facilities; or (2) qualifies as a small 
public utility, unless it is a member of a tight power pool, or there 
are other circumstances that indicate a waiver is not justified.\5\ To 
qualify as a small public utility, an applicant ``must be a public 
utility that meets the Small Business Administration (SBA)

[[Page 25729]]

definition of a small electric utility, i.e., disposes of no more that 
4 million MWh annually.'' \6\ In determining the amount of electricity 
a public utility ``disposes of,'' the Commission has considered the 
annual sales of the public utility in megawatt hours.\7\
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    \4\ Order No. 889, FERC Stats. & Regs. ] 31,035 at 31,594.
    \5\ Black Creek, 77 FERC at 61,941; Central Minnesota Municipal 
Power Agency, 79 FERC ] 61,260, at 62,126-27 (1997) (Central 
Minnesota). See also Order No. 717, FERC Stats. & Regs. ] 31,280 at 
P 23.
    \6\ Black Creek, 77 FERC at 61,941.
    \7\ The Commission, for example, identified the number of small 
public utilities that would be affected by open access and OASIS 
reforms by reference to sales data reported in FERC Form No. 1. See 
Order No. 889, FERC Stats. & Regs. ] 31,035 at 31,628. In Order No. 
717, the Commission clarified that public utilities that have 
received a full or partial waiver of the Standards of Conduct could 
continue to rely on those waivers to the extent the reforms adopted 
therein did not render such waivers moot. See Order No. 717, FERC 
Stats. & Regs. ] 31,280 at P 33.
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    4. The Commission articulated similar criteria for evaluating 
requests for waiver of open access requirements adopted in Order No. 
888.\8\ In orders granting waivers of Order No. 889, the Commission has 
not explicitly stated what would happen if the facts upon which the 
Commission relied when granting the waiver changed. Orders granting 
waiver of Order No. 889 or Standards of Conduct requirements generally 
have been silent on any obligation for the public utility to notify the 
Commission of material changes in fact that might affect the waiver.\9\ 
Instead, those orders provide that such waivers remain effective until 
the Commission takes action in response to a complaint alleging 
inadequate access to transmission information or use of transmission 
information to unfairly benefit a utility's sales, even if material 
changes have occurred.\10\
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    \8\ See Promoting Wholesale Competition Through Open Access Non-
Discriminatory Transmission Services by Public Utilities; Recovery 
of Stranded Costs by Public Utilities and Transmitting Utilities, 
Order No. 888, FERC Stats. & Regs. ] 31,036, at 31,853-54 (1996), 
order on reh'g, Order No. 888-A, FERC Stats. & Regs. ] 31,048, order 
on reh'g, Order No. 888-B, 81 FERC ] 61,248 (1997), order on reh'g, 
Order No. 888-C, 82 FERC ] 61,046 (1998), aff'd in relevant part sub 
nom. Transmission Access Policy Study Group v. FERC, 225 F.3d 667 
(D.C. Cir. 2000), aff'd sub nom. New York v. FERC, 535 U.S. 1 
(2002). In Order No. 888, the Commission noted that the disposition 
of 4 million MWh a year translated, at the time, into sales in the 
range of $120-180 million/year and noted that the SBA defines a 
small electric utility as one that disposes of 4 million MWh per 
year. Order No. 888, FERC Stats. & Regs. ]31,036 at 31,897 and 
n.1072.
    \9\ See, e.g., Alcoa Power Generating, Inc., 108 FERC ] 61,243 
(2004); Salmon River Electric Cooperative, Inc., 107 FERC ] 61,132 
(2004); FPL Energy Oliver Wind, LLC, 123 FERC ] 61,246 (2008); but 
see Wabash Valley Power Ass'n, 123 FERC ] 61,193, at P 11 (2008) 
(directing applicant to notify the Commission if material 
circumstances change that affect its continued qualification for 
waiver); Perryville Energy Partners, L.L.C., 118 FERC ] 61,140, at P 
8 (2007) (directing notification if material circumstances change); 
Standards for Business Practices and Communication Protocols for 
Public Utilities, Order No. 676, FERC Stats. & Regs. ] 31,216, at P 
115 (2006), reh'g denied, Order No. 676-A, 116 FERC ] 61,255 (2006), 
amended, Order No. 676-B, FERC Stats. & Regs. ] 31,246 (2007), 
revised, Order No. 676-C, 73 Fed. Reg. 43,848 (July 29, 2008), FERC 
Stats. & Regs. ] 31,274 (2008), order on clarification and reh'g, 
Order No. 676-D, 124 FERC ] 61,317 (2008) (extending to small 
entities that previously were granted waiver of Order Nos. 888 and 
889 waivers of the OASIS requirements adopted in the Rule, with the 
condition that if material circumstances change that affect 
continued qualification they must report it to the Commission).
    \10\ In contrast, for waivers of Order No. 888, the Commission 
has required each utility receiving a waiver to file an Open Access 
Transmission Tariff (OATT) within 60 days of receiving a request for 
transmission service on its transmission system. See, e.g., Central 
Minnesota, 79 FERC at 62,126-27.
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Guidance

    5. In order to ensure that public utilities continue to qualify for 
a waiver of the requirements of Order No. 889 or the Standards of 
Conduct, the Commission will require any public utility that has 
received a waiver of Order No. 889 or the Standards of Conduct to 
notify the Commission if there has been a material change in facts that 
may affect the public utility's waiver. A material change would include 
that the utility no longer meets the sales threshold applied to 
determine eligibility for the waiver \11\ or if the facilities owned, 
operated, or controlled by the public utility are no longer ``limited 
and discrete.'' Upon receipt of the notice of the change of facts, the 
Commission may reevaluate continued eligibility for the waiver. 
Utilities that are granted a waiver have 30 days from the date of the 
change to submit a notification. A previously granted waiver will 
remain in effect until the Commission acts on such filing.
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    \11\ As discussed in Wolverine Power Supply Cooperative, Inc., 
to be issued concurrently with this order, the Commission retains 
the existing threshold for defining a small public utility. 
Wolverine Power Supply Cooperative, Inc., 127 FERC ] 61,159 (2009).
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    6. We recognize that the Commission has not previously required 
utilities with waivers to notify the Commission of material changes in 
fact that may affect the waiver. Accordingly, we will allow all public 
utilities that previously have been granted a waiver 45 days from the 
date of publication of this order in the Federal Register to notify the 
Commission of any change in material facts upon which the Commission 
relied in granting a waiver of the requirements of Order No. 889 and 
the Standards of Conduct.
    The Commission orders:
    (A) Any public utility that has received a waiver of Order No. 889 
or the Standards of Conduct is hereby directed to notify the Commission 
if there has been a material change in facts that may affect the 
waiver, within 30 days of the date of the change, as discussed in the 
body of this order.
    (B) The Secretary is hereby directed to publish a copy of this 
order in the Federal Register.

    By the Commission.
Kimberly D. Bose,
Secretary.
[FR Doc. E9-12437 Filed 5-28-09; 8:45 am]
BILLING CODE 6717-01-P


