FERC Orders BPA to Halt Discriminatory Transmission Practices in Landmark Case
FERC requires BPA to file an Open Access Transmission Tariff; ruling establishes framework for preserving Northwest’s low electricity prices
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December 7, 2011
PORTLAND, Ore. — Iberdrola Renewables, a member of a coalition of leading Pacific Northwest energy companies involved in landmark litigation with the Bonneville Power Administration, hailed a ruling today from the Federal Energy Regulatory Commission requiring BPA “to provide comparable transmission service that is not unduly discriminatory or preferential.”
“We are pleased with the Commission’s action on this important case, which establishes that BPA must offer open and non-discriminatory access to its transmission grid customers,” said Don Furman, senior vice president of Iberdrola Renewables.
“Fair and non-discriminatory grid operations ensures an efficient power market — which is the best way to keep energy prices low for all Northwest ratepayers,” added Furman. “Keeping the transmission lines open ensures that the cheapest supplies reach customers.
FERC (Commission) issued pursuant to its authority under Section 211A of the Federal Power Act an order directing BPA to file within 90 days revisions to its Open Access Transmission Tariff (OATT) to provide for transmission service on terms and conditions that are comparable to those under which BPA provides transmission services to itself and that are not unduly discriminatory or preferential. This is the first time the Commission has exercised its authority under Section 211A of the Federal Power Act.
The Commission found that Bonneville’s Environmental Redispatch Policy “significantly diminishes open access to transmission, and results in Bonneville providing transmission service to others on terms and conditions that are not comparable to those it provides itself.” In particular, the Commission held that the policy results in unfair and noncomparable treatment of non-Federal generating resources connected to BPA’s system — resources the Commission found to be similarly situated to Federal hydroelectric and thermal resources for purposes of transmission curtailments because all such resources take firm transmission service. Environmental Redispatch was a policy that unfairly curtailed non-federal generation during high-water situations in the spring of 2011.
The Commission specifically noted that it is making no determinations as to whether actions taken by BPA in the past, whether pursuant to its Environmental Redispatch Policy or otherwise, were prohibited under BPA’s statutory authorities. To that end, to the extent BPA’s past actions are subject to judicial review by the Ninth Circuit Court of Appeals; such review does not limit the Commission’s prospective exercise of authority in this proceeding under Section 211A.
Energy producers laud the ruling as a victory for power consumers in the Pacific Northwest.
“BPA’s policy, as we saw this past spring, was keeping prices higher for the power it was selling into the wholesale market — not protecting fish or maintaining reliability,” said Furman. “FERC’s ruling will stop this and other discriminatory practices, and allow all energy producers to compete on a level playing field.
“Despite our dispute on this issue, we have and will continue to work collaboratively with BPA. This is a great opportunity for the region’s utilities and consumers to work on long-term solutions,” Furman said. “We have a long history of working together to meet the region’s energy needs and look forward to better policies in the future.”