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Enron Mail |
Summary of today's meeting from our trade association and a news article pi=
cked up by Steve Hall. GAC=20 FYI. At today's FERC meeting two sets of items were voted out that pertain= directly to the CA markets. This summary is based upon the discussion at = the meeting, and the actual orders will contain additional details that may= not be reflected here. A subsequent email will circulate with links to th= e FERC orders once they are posted. 1) FERC voted out an order granting in part, and denying in part, the Reli= ant / Mirant complaint against CAISO. The order builds on the 11/7 creditw= orthiness order and finds that DWR is a Scheduling Coordinator, that it sho= uld not have access to confidential information not also available to other= s, and that DWR should be scheduling and operating pursuant to the CAISO ta= riff. During the discussion on this item, Massey noted concern about CAISO allega= tion that the BEEP stack is not reliable b/c generators are not following d= ispatch instructions. Massey wants CAISO to promptly inform the Commission= where they believe an entity is not complying with the tariff or failing t= o follow the dispatch instruction. 2) The second set of orders involves three dockets: (a) a new 206 rulemakin= g regarding market-based rate authority; (b) revision of the market power t= est, made in the context of a triennial review of market based rate authori= ty; and © a narrow exemption to the FERC market mitigation for entities w= ith market power pursuant to the order in (b). FERC is putting out a new rulingmaking regarding market-based rate authorit= y to close what they find to be a flaw with existing tariffs in the wake of= California's problems. The rulemaking initiated today calls for the impos= ition of a refund provision in all market-based rates. The refund requirem= ent attaches to "bad behavior" such as economic or physical withholding or = other anticompetitive actions. Apparently there is a portion of the rulema= king that asks for comments within 15 days. During discussion, Massey poin= ted out that no "bad behavior" was found in California, and that customers = should not be forced to bear the burden where the market goes out of contro= l. FERC has revised the market power analysis used to support a request for ma= rket-based rate authority. FERC is now establishing a "supply margin analy= sis" (SMA) to replace the "hub & spoke" analysis used to determine the pres= ence of market power. The SMA looks for "pivotal" suppliers based on peak = demand within a market. The definition of the market would recognize the r= ole of transmission constraints. A generator is considered "pivotal" where= its supply is required to meet system peak demand. If such status is foun= d, the market-based rate authority does not extend to those peak conditions= , and instead the applicable rates are a cost-based rate that is applicable= only to the uncommitted unit capacity. Rates for any such capacity would = be posted in INCs and DECs for that uncommitted capacity. This policy revi= sion occurs in the context of a triennial review of market based rate autho= rity for AEP, Southern and Entergy. Additional details will be in the orde= r and we'll send an email with links when it gets posted. The last item would create a narrow exemption to the application of SMA and= maket power mitigation in the case where the supplier is in a ISO or RTO w= ith existing, FERC-approved market mitigation mechanisms. While this order= was to be adopted along with the other two noted above, it was held for so= me revisions and is expected to come out either later today or tomorrow. T= he context for this order is the Huntington Beach application. The languag= e revisions are aimed at addressing concerns that at the end of the west-wi= de mitigation in the coming September, there would not be an effective repl= acement mitigation mechanism at CAISO. We will have a short discussion on these items during the FERC call at 10 a= m today. ABB -- Andrew Brown Sacramento, CA andybrwn@earthlink.net -----Original Message----- From: =09Hall, Steve C. (Legal) =20 Sent:=09Tuesday, November 20, 2001 10:09 AM To:=09Comnes, Alan Subject:=09FW: USA: UPDATE 1-FERC claims jurisdiction over Calif water dept= . You may have seen this. -----Original Message----- From: =09Bryson, Jesse =20 Sent:=09Tuesday, November 20, 2001 10:07 AM To:=09Hall, Steve C. (Legal) Subject:=09USA: UPDATE 1-FERC claims jurisdiction over Calif water dept. USA: UPDATE 1-FERC claims jurisdiction over Calif water dept. =20 11/20/2001=20 Reuters English News Service=20 (C) Reuters Limited 2001.=20 WASHINGTON, Nov 20 (Reuters) - The Federal Energy Regulatory Commission on = Tuesday said it has jurisdiction over California's main power purchasing ar= m, the California Department of Water Resources, which took over buying pow= er for much of the state earlier this year.=20 FERC also told the California Independent System Operator (ISO), which mana= ges the power grid, to stop giving preferential treatment to the state wate= r agency.=20 As a power scheduling coordinator for PG&E Corp and Edison International's = Southern California Edison, the water department must file with FERC a tari= ff schedule, FERC staffers said at a commission meeting. Those schedules ar= e routinely required of other market players.=20 The water department also should not be privy to market information unavail= able to other market participants, the commission said. Such information sh= aring constitutes "preferential treatment of the ISO towards the (state) wa= ter department, said FERC Commissioner William Massey.=20 The California ISO manages the state's transmission grid and runs a complic= ated daily power auction to match buyers and sellers. FERC is currently aud= iting the ISO.=20 The California Department of Water Resources became the state's only credit= -worthy buyer earlier this year. The state stepped into the role after powe= r shortages and impending price spikes barred direct purchases by the state= 's two largest utilities.=20 Pacific Gas & Electric filed for Chapter 11 bankruptcy protection in April = and SoCal Edison's credit is rated junk status.=20 Generators accused the California ISO of sharing sensitive market informati= on with the water department and tilting its auction rules to favor long-te= rm contracts inked in the wake of the power crisis.=20 Power generators Mirant Corp. and Reliant Energy Inc. have complained to FE= RC that information-sharing between the water department and the California= ISO violates the California ISO's tariff.
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