By Rich Heidorn Jr.

FERC this week rejected a proposed power and gas tariff filed by the North American Energy Markets Association (NAEMA) and indicated it is likely to revoke the group’s capacity and energy tariff, which the commission accepted in 2003. The group said Thursday night it will seek an emergency stay to give it time to amend the older agreement.

NAEMA, which claims about 150 members that have 500,000 MW of generating capacity and serve more than 100 million electric and gas customers, developed the power and gas tariff with the International Energy Credit Association.

The group said the tariff, filed in January, was similar to the 2003 tariff but was updated to reflect current industry preferences for contract language and products. It intended to leave the existing tariff in place with the new one available for companies that choose to use it.

But the commission said March 19 that the tariffs should not be on file with it because NAEMA is not a jurisdictional public utility (ER18-676). “Nor does the power and gas tariff filed by NAEMA set forth any rates and charges or terms and conditions that govern the transmission or sale of electric energy. Instead, the power and gas tariff merely contains standard form bilateral sales contracts with a set of standard terms and conditions that NAEMA members may choose to use when they make sales of their own capacity and energy or natural gas to customers.”

The commission said NAEMA members that are public utilities should enter separate, standalone bilateral agreements under their own market-based rate tariffs whether or not they comport with NAEMA’s standard terms and conditions. Such transactions should be included in the utility’s Electric Quarterly Reports, FERC said.

“We make no findings about [the proposed tariff’s] specific terms and conditions or whether NAEMA members should or should not use it as a template for any market-based rate bilateral sales agreements,” the commission said.

Show Cause

FERC also directed NAEMA to show within 30 days why the 2003 tariff, which was approved by a letter order by a division director, should remain on file with the commission (ER04-22). “If such a filing is not received within the required time, NAEMA’s capacity and energy tariff will be canceled in the commission’s eTariff system,” it said. The commission did not say why it now considered the 2003 order — which NAEMA says was updated as recently as 2011 — an apparent error.

NAEMA was created in 2003 as a successor to the Power and Energy Market (PEM) of the Mid-Continent Area Power Pool (MAPP) after the group expanded. NAEMA said the 2003 tariff was a successor to one approved by FERC in 2001 for MAPP (ER01-3045) and has been updated five times since then.

Emergency Stay Sought

NAEMA attorney K.C. Hairston told RTO Insider Thursday evening that the organization will file an emergency motion seeking a stay of the show cause order to allow it to propose an amendment to the energy and capacity tariff that it said should address the commission’s jurisdictional concerns. The motion was filed early Friday.

The amendment would be a cost-based schedule, which NAEMA says will ensure the tariff falls “within the categories of agreements described by the commission in the show cause order where non-jurisdictional entities can submit tariffs on behalf of jurisdictional companies.”

The group pledged to submit the proposed amendment within 60 days.

Overwhelmingly Surprised

In the motion, NAEMA says it was “overwhelmingly surprised” by the order, claiming it contacted the commission’s Office of General Counsel regarding the jurisdiction issue and incorporated changes it suggested. The group said it realizes that OGC does not speak for the commission but “assumed that the commission would take a consistent view” with the office.

NAEMA said it had cause for the stay because “Terminating a tariff that has been repeatedly approved by the commission for over a decade and is currently used by market participants across the United States will be disruptive to the energy markets the commission regulates.”

The group also made an unusual request, saying “it will be beneficial to have a designated non-decisional commission staff member that it can consult with should issues arise” in drafting the amendment.

NAEMA, which holds regular conferences, says its goal is to “promote and facilitate a vibrant physical and financial energy marketplace” through “contacts and contracts.” Its board members include staff from ACES Power Marketing, AEP Energy Partners, EDF Renewable Energy, MidAmerican Energy, Southern Power, The Energy Authority, TransAlta Energy Marketing, WPPI Energy and Xcel Energy.