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Andrew Mina is an associate in the Real Estate and Land Use and Environmental Practice Groups in the firm's Washington, D.C. office.

On February 18, 2021, the Federal Energy Regulatory Commission (FERC or Commission) issued a renewed Notice of Inquiry (NOI)[1] seeking input on potential revisions to its current Policy Statement on the certification of new natural gas transmission facilities.[2]  The NOI supplements FERC’s 2018 NOI issued on the same topic.[3]  Citing changes following receipt of comments in its 2018 NOI proceeding (e.g., the Council on Environmental Quality’s promulgation of updated regulations under the National Environmental Policy Act of 1969 (NEPA) for implementation by all federal agencies[4] and Executive Order 14008[5]) FERC is seeking to refresh the record and provide “additional viewpoints.”
Continue Reading FERC Issues Second NOI Concerning Its Certificate Policy

The FERC today issued Order No. 871-A, seeking further comment on modifications last summer to its regulations under Natural Gas Act Sections 3 and 7 that prohibited initiating pipeline construction, pending timely filing of any rehearing request, or a rehearing order on the merits. The Commission has requested initial briefs promptly, by February 16, and reply briefs by March 3. Perhaps not coincidentally, Order No. 871 is currently pending judicial review.
Continue Reading FERC Seeks Further Comment Regarding Pipelines Initiating Construction While Rehearing is Pending

Through a Notice of Inquiry (“Notice”)[1] approved at its January 19, 2021 open meeting, the Federal Energy Regulatory Commission (“FERC”) asked whether its Uniform System of Accounts (individually, an “Account,” and for more than one, “Accounts”) should be modified to better reflect the circumstances of non-hydro renewable assets that rely on heat, or motion, of the earth or sun, such as facilities that rely on solar, wind, biomass and geothermal sources.  The Notice describes how various Account categories currently do not readily correspond to renewable equipment. The Notice observes that certain types of renewable equipment (e.g., solar panels and photovoltaic (“PV”) inverters), and related maintenance expenditures (e.g., for solar panels, wind towers or their blades) do not fit well within existing descriptions of the Accounts.[2]
Continue Reading FERC Considers Whether to Modify Accounting System for Renewables

Recently, the New York Independent System Operator (“NYISO”) implemented new rules to integrate storage resources, including battery resources, into wholesale electricity markets. NYISO’s rules come in response to FERC Order No. 841. Here are six key regulatory and transactional items from the new rules.
Continue Reading NYISO Battery Storage Rules

Blockchain technology and smart contracts continue to show their potential for disrupting the electric energy industry. Through the use of blockchain, electricity markets could become more decentralized, efficient, transparent and automated. However, blockchain users must have a good understanding of the regulatory landscape in which they will be operating to ensure compliance with applicable laws, and traditional utilities should be aware of the opportunities and pitfalls the technology could pose. Please see attached the latest Sheppard Mullin Six Items to Consider concerning blockchain in the electric industry. 
Continue Reading Blockchain in the Electricity Industry: Six Items to Consider

A September 17, 2020 Final Rule adopted by the Federal Energy Regulatory Commission (“Commission”) removes barriers to the participation of distributed energy resource aggregators in Regional Transmission Organization (“RTO”) and Independent System Operator (“ISO”) markets.[1]  The Commission’s modified regulations[2] require each RTO/ISO to revise its tariff to ensure that its market rules facilitate the participation of distributed energy resource aggregators.  Order No. 2222 is a positive development for distributed energy resources that would like to participate in wholesale electric markets but are unable to do so, and should encourage greater renewable energy resource development in the coming years.  However, the scope and implementation of each RTO’s/ISO’s participation model remains to be seen: distributed energy resources will need to keep an eye on RTOs’/ISOs’ proposed tariff revisions.  Moreover, maximizing the opportunity for distributed energy resources to contribute to markets will be affected by whether the Commission continues to reform Commission-jurisdictional markets to broaden participation of emerging technologies as it did in Order No. 2222, or adopt measures that bolster the viability of fossil and nuclear resources at the expense of emerging technologies as it has done in other proceedings.
Continue Reading Federal Energy Regulatory Commission Gives Distributed Energy Resource Aggregators a Boost; Implementation Will Present Challenges

On July 16, 2020, the Federal Energy Regulatory Commission (“FERC” or “Commission”) dismissed a petition filed by the New England Ratepayers Association (“NERA”) requesting that the Commission declare that certain sales of energy by net-metered, behind-the-meter generators are exclusively subject to federal jurisdiction.  If granted, the petition would have resulted in the rates for such sales being set at an avoided cost rate in accordance with the Public Utility Regulatory Policies Act of 1978 (“PURPA”) or wholesale market prices under the Federal Power Act (“FPA”), as applicable, rather than the interconnected utility’s retail rate.  The Commission declined to address the legal issues raised by the petition.  Instead, it determined that the issues presented in NERA’s petition do not warrant a generic statement from the Commission at this time because NERA failed to identify a specific controversy or harm that the Commission should address.  However, concurring opinions from two commissioners suggest that future fights may be imminent over the scope of FERC’s authority to regulate net metering transactions and the rates for such transactions.
Continue Reading FERC Rejects Net Metering Petition, But Fight Is Far From Over

On June 9, 2020, the Federal Energy Regulatory Commission (FERC) issued a regulation precluding construction authorization for pipelines approved pursuant to Sections 3 and 7 of the Natural Gas Act (NGA) until FERC acts on the merits of any timely-filed requests for rehearing or the time for filing a rehearing request has expired.  Parties seeking to construct new interstate pipeline facilities likely will contend FERC’s regulation is overbroad and burdensome.  They may contend that it imposes unnecessary delays on the construction of critical energy infrastructure already approved by FERC and found to be in the public interest.  The regulation precludes the construction of the entirety of the approved pipeline regardless of whether the scope of the rehearing request includes all of the facilities. The regulation is linked to concerns that landowners will be subject to eminent domain actions, yet ostensibly bars construction activity regardless of the basis of the rehearing request, for instance regardless of whether the rehearing request has anything to do with the exercise of condemnation rights.  Pipelines may contend that the regulation is inconsistent with the NGA, federal policy supporting the construction of needed energy infrastructure, and a recent executive order directing federal agencies to support the economic response to the COVID-19 outbreak.
Continue Reading FERC Issues Regulation Prohibiting Construction of Newly Approved Natural Gas Pipeline Facilities Until Resolution of all Rehearing Requests

On May 21, 2020, the Federal Energy Regulatory Commission (“FERC” or “Commission”) approved two orders by 3-1 votes revising its methods to estimate electric, natural gas and oil utilities’ returns on equity (“ROE”).[1]  Return on equity is one of the most contentious issues in cost-of-service proceedings before FERC, and FERC’s guidance is unlikely to alter that.  In many important ways, the guidance significantly deviated for electric utilities and pipelines, which raises a number of issues regarding whether such deviations are supported by each industry’s risks.
Continue Reading FERC Issues Revised Guidance Regarding Return on Equity Calculations