Transmission rule puts Northwestern providers in legal limbo — Wyden

Source: Hannah Northey, E&E reporter • Posted: Wednesday, March 6, 2013

The chairman of the Senate Energy and Natural Resources Committee yesterday warned that a landmark federal ruling to revamp the country’s transmission planning process could force utilities in the Pacific Northwest to illegally surrender their authority for distributing the costs of new power lines.

Sen. Ron Wyden (D-Ore.) took issue with the Federal Energy Regulatory Commission’s Order 1000, a far-reaching rule the agency approved two years ago to revamp the country’s process for planning, siting and allocating costs for new power lines (Greenwire, July 21, 2011).

Wyden told FERC Chairman Jon Wellinghoff in a letter yesterday that the rule is “akin to trying to hammer a square peg into a round hole” for federally owned entities like the Bonneville Power Administration and Columbia Grid, which don’t traditionally fall under FERC’s jurisdiction.

BPA made a filing to comply with Order 1000 but only included recommendations for how the cost of new power lines should be assigned, which Wyden attributed to the fact that legal questions may arise.

“The reason for this is that Bonneville and other non-jurisdictional utilities that belong to ColumbiaGrid believe that it would be both unwise and unlawful for them to cede their authority over transmission cost allocation to FERC,” Wyden wrote. “I strongly agree.”

Wyden said FERC — namely, Republican Commissioner Philip Moeller — has repeatedly supported the commission’s willingness to show “regional flexibility,” adding that “now is the time to show that it is truly committed to that principle.”

The commission has authority under the Federal Power Act to require non-public utilities that the agency doesn’t oversee to comply with its rules, according to the order. But FERC chose not to use that authority in Order 1000 because public and non-public utilities were showing a willingness to collaborate on transmission planning.

FERC, however, wasn’t as clear when it came to cost allocation.

The commission said in Order 1000 that if non-public entities like BPA wanted to maintain their “safe harbor” status with public utilities, they would need to partake in regional cost allocation. The commission indicated in the order that non-public transmission providers that failed to do so could lose their ability to use public systems under a FERC-approved “safe harbor” agreement.

FERC spokesman Craig Cano wouldn’t comment on the letter last night but said the commission would respond to the senator.