By Rich Heidorn Jr.

FERC last week denied requests for changes to Order 807, which granted a blanket waiver from Open Access Transmission Tariff requirements to owners and operators of generator tie lines (RM14-11-001).

The commission’s April order also allowed generators to reserve excess capacity on their tie lines, or “interconnection customer’s interconnection facilities (ICIF),” for the first five years of operation. (See Generator Tie Lines Exempted from OATT Rules.)

The commission denied a rehearing request from the National Rural Electric Cooperative Association (NRECA) and a second filed jointly by the American Public Power Association (APPA) and the Transmission Access Policy Study Group (TAPS).

Safe Harbor

NRECA asked the commission to reconsider its presumption that an ICIF owner has plans to use its capacity when the third-party requesting transmission service is a load-serving entity.

NRECA noted that renewable generating resources are often located in remote areas and require long tie lines to connect to the interstate grid. The group said it would be more efficient for an LSE to contract with an ICIF owner to counterflow power over the line rather than to build a new facility to serve its native load.

It said the tie line owner should have the burden of proving it has specific plans to use the excess capacity that would prevent it from providing LSEs access.

FERC said it disagreed with NRECA’s contention that the five-year safe harbor period “impinges upon the reasonable needs of LSEs.”

“Because of the case-specific nature of any request under sections 210 and 211 to use certain ICIF, we cannot … state exactly what evidence would be strong enough to overcome the rebuttable presumption during the safe harbor,” FERC added.

Open Access

FERC also rejected the allegation by APPA and TAPS that the rule grants tie line owners vertical market power over access to their facilities. The groups said FERC unfairly ruled that third parties would not be unduly burdened by pursuing transmission service under Federal Power Act sections 210 and 211.

The commission said its rule “does not foreclose access” to tie lines but sought to reduce unnecessary regulatory burdens for owners that may plan to use excess transmission capacity for future phases of generation construction.

“Without such reasonable assurance, there would be little incentive for a developer to shoulder the extra expense of ICIF sized larger than the initial phase of the project,” the commission said.

Clarification

The commission clarified that no commission proceeding is necessary for a blanket waiver to be revoked if the public utility acquires additional transmission facilities that are not ICIF or otherwise no longer qualifies for the exemption.  FERC said the waiver would be automatically revoked and the owner would be required to file an OATT within 60 days.

FERC also clarified that non-public utility ICIF owners may also take advantage of the blanket waiver and safe harbor period.

“Although the determination in the final rule does not explicitly state that non-public utility ICIF owners may take advantage of the blanket waiver, this omission was unintentional,” the commission said. “The intent of the final rule was to make the package of reforms equally available to nonpublic utility ICIF owners.”