FERC has denied a rehearing request and partly adopted a clarification request by Constellation Energy related to a challenge to the fixed costs associated with the Mystic cost-of-service agreement (COSA) (ER18-1639-028). 

Initially signed in 2018, Mystic’s COSA between Constellation and ISO-NE delayed the retirement of the Mystic Generating Station by two years to help provide fuel security to the region. The agreement is set to expire — and Mystic to retire — at the end of May. 

As part of the COSA, Constellation is required to submit annual informational filings related to the costs of the agreement. Relevant stakeholders are allowed to request more information and ultimately challenge the filings with FERC.  

The May 23 FERC ruling stems from an October 2022 series of challenges by a group of municipal utilities to an informational filing submitted that year.  

In December 2023, FERC granted several of the municipal utilities’ challenges, determining “that the challenges raised issues of material fact that could not be resolved on the record before the commission, and thus established hearing and settlement judge procedures.” 

In January 2024, Constellation requested rehearing on three of the order’s rulings and clarification on two rulings — while also requesting rehearing on the latter two rulings if not granted the clarifications. 

“The relief sought herein is aimed at avoiding unnecessary litigation in a case that has seen too much already,” the company wrote. 

In its ruling May 23, FERC dismissed the rehearing requests on the basis that the challenge order was not a final decision and therefore not subject to rehearing. 

FERC did grant Constellation’s clarification request regarding projected 2023 capital expenditures at the Everett LNG import facility, which also is owned by Constellation and provides the fuel for Mystic via a fuel supply agreement.  

A 2022 settlement agreement among Constellation, the New England states and ISO-NE “resulted in the Mystic Agreement no longer providing recovery for any Everett 2023 [reliability-must-run capital expenditures],” FERC wrote.  

“Accordingly, we grant Mystic’s requested clarification and determine that there is nothing further to litigate” regarding this aspect of the informational filing, FERC ruled.  

Meanwhile, FERC affirmed its 2023 ruling to “set for hearing and settlement judge procedures” the three other formal challenges to the informational filings, which relate to the calculations of Mystic and Everett’s rate bases prior to the agreement.