[Federal Register Volume 62, Number 236 (Tuesday, December 9, 1997)]
[Rules and Regulations]
[Pages 64715-64720]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-31856]
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DEPARTMENT OF ENERGY
Federal Energy Regulatory Commission
18 CFR Part 37
[Docket No. RM95-9-002; Order No. 889-B]
Open Access Same-Time Information System and Standards of Conduct
Issued November 25, 1997.
AGENCY: Federal Energy Regulatory Commission.
ACTION: Final order; order denying rehearing.
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SUMMARY: The Federal Energy Regulatory Commission is denying the
requests for rehearing of its order on rehearing of the final rule in
this proceeding. The final rule required public utilities that own,
control, or operate facilities used for the transmission of electric
energy in interstate commerce to create or participate in an Open
Access Same-Time Information System (OASIS) in conformance with
Commission regulations. The final rule also required
[[Page 64716]]
those public utilities to implement standards of conduct to
functionally separate transmission and wholesale merchant functions.
The order on rehearing made minor revisions to the final rule and
implemented a revised transmission discounting policy. This order
denies the requests for rehearing filed by six interested persons in
response to the order on rehearing of the final rule.
EFFECTIVE DATE: November 25, 1997.
FOR FURTHER INFORMATION CONTACT:
Marvin Rosenberg (Technical Information), Office of Economic Policy,
Federal Energy Regulatory Commission, 888 First Street, N.E.,
Washington, DC 20426, (202) 208-1283.
William C. Booth (Technical Information), Office of Electric Power
Regulation, Federal Energy Regulatory Commission, 888 First Street,
N.E., Washington, DC 20426, (202) 208-0849.
Gary D. Cohen (Legal Information), Office of the General Counsel,
Federal Energy Regulatory Commission, 888 First Street, N.E.,
Washington, DC 20426, (202) 208-0321.
SUPPLEMENTARY INFORMATION: In addition to publishing the full text of
this document in the Federal Register, the Commission also provides all
interested persons an opportunity to inspect or copy the contents of
this document during normal business hours in the Public Reference Room
at 888 First Street, N.E., Washington, D.C. 20426.
The Commission Issuance Posting System (CIPS), an electronic
bulletin board service, provides access to the texts of formal
documents issued by the Commission. CIPS is available at no charge to
the user. CIPS can be accessed over the Internet by pointing your
browser to the URL address: http://www.ferc.fed.us. Select the link to
CIPS. The full text of this document can be viewed, and saved, in ASCII
format and an entire day's documents can be downloaded in WordPerfect
6.1 format by searching the miscellaneous file for the last seven days.
CIPS also may be accessed using a personal computer with a modem by
dialing 202-208-1397, if dialing locally, or 1-800-856-3920, if dialing
long distance. To access CIPS, set your communications software to
19200, 14400, 12000, 9600, 7200, 4800, 2400, or 1200 bps, full duplex,
no parity, 8 data bits and 1 stop bit. The full text of this order will
be available on CIPS in ASCII and WordPerfect 6.1 format. CIPS user
assistance is available at 202-208-2474.
The complete text on diskette in WordPerfect format may be
purchased from the Commission's copy contractor, La Dorn Systems
Corporation. La Dorn Systems Corporation is located in the Public
Reference Room at 888 First Street, N.E., Washington, D.C. 20426.
Before Commissioners: James J. Hoecker, Chairman; Vicky A.
Bailey, and William L. Massey.
Order Denying Rehearing of Order No. 889-A
Issued November 25, 1997.
I. Introduction
In this order, we deny the requests for rehearing of Order No. 889-
A, our order on rehearing of Order No. 889.\1\
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\1\ Open Access Same-Time Information System and Standards of
Conduct, Final Rule, Order No. 889, FERC Stats. & Regs. para.
31,035, 61 FR 21737 (May 10, 1996), Order on Reh'g, Order No. 889-A,
FERC Stats. & Regs. para. 31,049, 62 FR 12484 (March 14, 1997).
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II. Background
In Order No. 889-A, the Commission addressed over 40 requests for
rehearing of Order No. 889 and affirmed the major findings made
therein. We did, however, make certain minor revisions to fine-tune the
regulations at 18 CFR Part 37 and to implement a revised transmission
discounting policy that we adopted and described in detail in Order No.
888-A, our order on rehearing of Order No. 888.\2\
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\2\ Promoting Wholesale Competition Through Open Access Non-
Discriminatory Transmission Services by Public Utilities; Recovery
of Stranded Costs by Public Utilities and Transmitting Utilities,
Final Rule, Order No. 888, FERC Stats. & Regs. para. 31,036, 61 FR
21540 (May 10, 1996), Order on Reh'g, Order No. 888-A, FERC Stats. &
Regs. para. 31,048, 62 FR 12274 (March 14, 1997).
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The revised transmission discounting policy necessitated a number
of changes to the Standards of Conduct and to the Open Access Same-Time
Information (OASIS) posting requirements in 18 CFR Part 37. These were:
(1) Deleting Secs. 37.4(b)(5)(v) and 37.4(b)(5)(vi);
(2) Adding a provision at Sec. 37.6(c)(3) to require, among other
things, that any offer of a discount for basic transmission service
must be announced to all potential customers solely by posting on the
OASIS;
(3) Revising Sec. 37.6(c)(4) to no longer treat the posting of
transmission service transactions involving the Transmission Provider's
(or any affiliate's) generation merchant function any differently from
the posting of transactions involving non-affiliates except that
transactions involving the Transmission Provider's wholesale merchant
function or affiliates must be identified;
(4) Adding a provision at Sec. 37.6(d)(2) to require, among other
things, that any offer of a discount for ancillary service provided by
the Transmission Provider in support of its provision of basic
transmission service must be announced to all potential customers
solely by posting on the OASIS;
(5) Revising Sec. 37.6(d)(3) on ancillary services to be consistent
with our revision to Sec. 37.6(c)(4);
(6) Revising Sec. 37.6(e)(1)(I) to require that, except for next-
hour service, requests for transmission and ancillary service must be
posted prior to the Transmission Provider responding to these requests;
(7) Adding a provision, at Sec. 37.6(e)(1)(ii), that during Phase
I, while requests for next-hour service need to be posted on the OASIS
as soon as possible and in any event within one hour of receiving the
request, they need not be posted on the OASIS prior to being acted on;
(8) Adding a provision, at Sec. 37.6(e)(1)(iii), that provides that
in the event that a discount is being requested for ancillary services
that are not in support of the Transmission Provider's provision of
basic transmission service, such a request need not be posted on the
OASIS;
(9) Expanding, in Sec. 37.6(e)(1)(iv), the information required to
be posted on the status of requests for transmission and ancillary
service; and
(10) Deleting the provision, formerly found in Sec. 37.6(e)(1)(iii)
and the revised Sec. 37.6(e)(3)(I), to disallow masking the identity of
parties to transactions.
We also made nine minor revisions in Order No. 889-A to the
regulations in 18 CFR Part 37 that were unrelated to our revised
transmission discounting policy. These were:
(1) Amending the definition of ``wholesale merchant function'' in
Sec. 37.3(e);
(2) Amending Secs. 37.4(b)(5)(iii) and 37.6(g)(4) to require
Transmission Providers to post on the OASIS the information that they
already were required to keep, detailing the circumstances and manner
in which they exercise their discretion under any terms of the tariff;
(3) Substituting the phrase ``sales made to any person for resale
made by the wholesale merchant function or any affiliate'' for the
phrase ``wholesale purchases or sales made on behalf of its own power
customers, or those of an affiliate'' in Sec. 37.4(b)(5)(iv), to be
consistent with the revised definition of ``wholesale merchant
function'';
(4) Amending Sec. 37.6(b)(1) to clarify the meaning of the term
[[Page 64717]]
``interconnection'' as used in the definition of ``posted path'';
(5) Amending Sec. 37.6(b)(3)(ii) to clarify that firm available
transmission capability (ATC) and nonfirm ATC for unconstrained posted
paths must be separately posted;
(6) Amending Sec. 37.6(e) to clarify that the provision applies to
requests for ancillary service and that requests for service must be
posted before the Transmission Provider responds to the request;
(7) Amending Sec. 37.6(g)(3) to require that notices of transfers
of personnel posted on the OASIS, as described in Sec. 37.4(b)(2),
remain available for the same time period as audit information in
Sec. 37.7(b);
(8) Amending Sec. 37.7(b) to shorten, from 90 days to 20 days, the
time during which ATC/total transmission capability (TTC) postings must
remain available for download on the OASIS (the data will, however,
remain available upon request for three years from the date when they
are first posted); and
(9) Deleting Sec. 37.8, because the compliance date for Part 37 had
already passed.
In response to the issuance of Order No. 889-A, requests for
rehearing were filed by six interested persons.\3\
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\3\ Requests for rehearing of Order No. 889-A were filed by
Coalition for a Competitive Electric Market (CCEM), National Rural
Electric Cooperative Association (NRECA), Transmission Access Policy
Study Group (TAPS), and Transmission Dependent Utility Systems (TDU
Systems). In addition, requests for rehearing of Order No. 889-A
nominally were filed by Puget Sound Energy, Inc. (Puget Sound) and
by the United States Department of Agriculture (USDA), although
these rehearing requests raise no specific issues related to Order
No. 889-A.
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III. Public Reporting Burden
This order on rehearing makes no changes to Order No. 889-A or the
regulations found at 18 CFR Part 37. Consequently, the public reporting
burden associated with issuance of this order is unchanged from what we
estimated when we issued Order Nos. 889 and 889-A. The Commission has
conducted an internal review of this conclusion and has assured itself,
by means of its internal review, that there is specific, objective
support for this information burden estimate. Moreover, the Commission
has reviewed the collection of information required by Order Nos. 889
and 889-A, as clarified by this order on rehearing, and has determined
that the collection of information is necessary and conforms to the
Commission's plan, as described in this order, for the collection,
efficient management, and use of the required information.
Persons wishing to comment on the collections of information
required by this order on rehearing should direct their comments to the
Desk Officer for FERC, Office of Management and Budget, Room 3019 NEOB,
Washington, D.C. 20503, phone 202-395-3087, facsimile 202-395-7285.
Comments must be filed with the Office of Management and Budget within
30 days of publication of this document in the Federal Register. Three
copies of any comments filed with the Office of Management and Budget
also should be sent to the following address: Ms. Lois Cashell,
Secretary, Federal Energy Regulatory Commission, Room 1A, 888 First
Street, N.E., Washington, D.C. 20426. For further information, contact
Michael Miller, 202-208-1415.
IV. Discussion
The rehearing requests collectively raise four major issues. We
will deny rehearing on each of these issues as discussed below.
A. Section 37.1--Applicability
The Commission's Waiver Policy
In Order Nos. 888 and 889, the Commission determined that requests
for waiver would be better decided on a case-by-case basis so that the
Commission could evaluate them based on individual circumstances,
rather than as part of a generic rulemaking.\4\ In Order No. 889, we
stated that the Commission would develop, in the context of individual
adjudications, a mechanism that would allow small public utilities to
seek a waiver of some or all of the Open Access requirements, including
the requirements to establish and/or participate in an OASIS and to
develop Standards of Conduct. This same waiver mechanism was made
applicable to small non-public utilities seeking waiver from all or
part of the reciprocity condition.
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\4\ See Order No. 888, FERC Stats. & Regs. at 31,854, Order No.
889, FERC Stats. & Regs. at 31,596.
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Consistent with this approach, the Commission, in Order Nos. 888-A
and 889-A, recounted the waiver standards enunciated by the Commission
in a series of orders dealing with companies' specific requests for
waiver of all or some of the requirements of Order Nos. 888 and 889,
and declined to revise the standards established in those case-by-case
determinations.\5\
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\5\ See Order No. 888-A, FERC Stats. & Regs. at 30,293 and
30,332-34, Order No. 889-A, FERC Stats. & Regs. at 30,554-55. We
did, however, in Order No. 888-A, provide some clarification of the
Commission's waiver policy. See FERC Stats. & Regs. at 30,334.
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Additionally, in Order No. 889-A, the Commission recited the
arguments raised in the requests for rehearing of the Commission's
waiver policy as it related to the Commission's OASIS and Standard of
Conduct requirements under Order No. 889. The Commission explained
that, in a series of orders, it had developed waiver criteria that took
into account potential burdens on small entities and at the same time
balanced the need to prevent undue discrimination and affiliate abuse
in interstate power markets, and that this flexible waiver approach
adequately addressed the concerns raised on rehearing. The Commission
concluded that an order on rehearing of a final rulemaking was not the
proper vehicle for a company to request a company-specific waiver or to
challenge the Commission's waiver policy. It further explained that
waivers are appropriately addressed on a case-by-case basis, which
permits the Commission to review the specific facts of each waiver
application and permits affected parties to intervene and make their
views known to the Commission.\6\
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\6\ See Order No. 889-A, FERC Stats. & Regs. at 30,555.
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Rehearing Requests. On rehearing, NRECA argues that the Commission
should modify its waiver policy so that waivers terminate upon issuance
of a Commission order, and not upon the filing of a complaint or
request for service.\7\ NRECA argues that a waiver should be terminated
not when an entity files a complaint, but when the Commission issues an
order finding that the complaint has merit.\8\
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\7\ At the time of NRECA's rehearing, the Commission's policy on
the expiration of waivers provided that
[w]aiver of the requirement to establish and maintain an
information system (i.e., an OASIS) will be granted unless and until
an entity evaluating its transmission needs complains that it could
not get information necessary to complete its evaluation. Waiver of
the standards of conduct will be granted unless and until an entity
complains that a public utility has used its access to information
about transmission to unfairly benefit the public utility's own or
the public utility's affiliates' sales. Compliance must be made
within 60 days of the complaint.
Order No. 889-A, FERC Stats. & Regs. at 30,555 and Black Creek
Hydro, Inc., et al., Order on Reh'g and Granting Waivers of Order
No. 889, 77 FERC para. 61,232 at 61,941 (1996).
\8\ NRECA Rehearing Request at p. 11.
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This same basic argument is also made by TDU Systems.\9\ TDU
Systems argues that the Commission's current waiver policy makes a
waiver a ``mirage'', terminable by a baseless complaint made solely to
drive up a competitor's costs by triggering
[[Page 64718]]
unnecessary compliance with the OASIS and Standards of Conduct
requirements.\10\ Moreover, TDU Systems argues that such a complaint,
terminating a waiver of Order No. 889 requirements, should be based on
a ``good faith'' request for transmission service and a prima facie
case that adequate information about a respondent's transmission
service is unavailable, or that preferential treatment is being given
to the respondent's wholesale merchant function.\11\
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\9\ TDU Systems Rehearing Request at pp. 10-12.
\10\ TDU Systems Rehearing Request at p. 11.
\11\ TDU Systems Rehearing Request at p. 12.
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Commission Conclusion. In a company-specific order issued
subsequent to the date of NRECA's and TDU Systems' rehearing requests,
the Commission modified its waiver policy in the manner requested by
the two parties.\12\ Specifically, the Commission has reconsidered its
policy of automatically revoking waivers of the requirements of Order
No. 889 on the filing of a complaint and has determined that,
henceforth, waivers will remain effective until the Commission takes
action in response to a complaint.
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\12\ Central Minnesota Municipal Power Agency, et al., Order on
Requests for Disclaimer of Jurisdiction and for Waiver of Order Nos.
888 and 889, 79 FERC para. 61,260 at 62,127 (1997).
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B. Sections 37.3 (Definitions) and 37.4 (Standards of Conduct)
Definition of ``Wholesale Merchant Function'' and Employees Engaged in
Wholesale Purchases for Bundled Retail Customers
In Order No. 889, in Sec. 37.6(e), the Commission defined the
``wholesale merchant function'' as the ``sale for resale, or purchase
for resale, of electric energy in interstate commerce.'' [Emphasis
added]. On rehearing of Order No. 889, Consolidated Edison Company of
New York, Inc. (ConEd) argued that the Commission had exceeded its
authority by requiring ``transmission providers to functionally
separate interstate electricity transmission and wholesale merchant
functions (wholesale sales and purchases of electricity in interstate
commerce).'' \13\ ConEd asserted that wholesale purchases of
electricity in interstate commerce on behalf of native load customers
are bundled retail electric service transactions that are local
distribution and not subject to the Commission's authority.
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\13\ ConEd Rehearing Request of Order No. 889 at p. 2.
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In Order No. 889-A, we considered ConEd's argument and stated as
follows:
We agree with ConEd to the extent that when a utility uses its
own transmission system to transmit purchased power to retail load
customers we have no jurisdiction over the transmission that is
included in the bundled sale of power to the retail native load.
Upon further consideration, we conclude that our definition of
``wholesale merchant function'' (in Sec. 37.3(e)) should be modified
to delete the phrase, ``* * *, or purchase for resale, * * * *''
because this clause creates confusion and is not necessary.\14\
\14\ FERC Stats. & Regs. at 30,552.
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We explained that when a utility purchases power for its retail native
load customers, this is not a sale for resale. We further explained
that,
[i]n contrast, when a utility purchases power for its wholesale
native load, the transmission of purchased power to the wholesale
customer is really part of a transaction that includes a wholesale
sale of power to a third party.\15\
\15\ Id.
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In Order No. 889-A, the Commission also explained that the
Standards of Conduct do not mandate that Transmission Providers assign
employees making purchases on behalf of bundled retail customers to the
group performing wholesale merchant functions. Specifically, we stated:
The standards of conduct's separation of functions currently
prohibit a Transmission Provider's employees engaged in transmission
system operations and reliability functions from giving preference
to wholesale purchases or sales made on behalf of its own wholesale
customers or those of affiliates. The standards of conduct do not,
however, dictate whether bundled retail merchant functions are to be
grouped with the wholesale merchant function or with the
transmission operations and reliability function.
Thus, FIT Utilities' request to allow dispatchers to buy power
to serve retail load is consistent with the regulations. As
discussed above, the regulations do not prohibit Transmission
Providers from assigning the responsibility for making purchases to
serve bundled retail customers to the transmission operations and
reliability function.
Rehearing Requests. On rehearing, CCEM argues that the Commission
erred by modifying the definition of ``wholesale merchant function''
and by revising provisions of the Standards of Conduct to exempt
transmission service provided in conjunction with a Transmission
Provider's wholesale purchases for bundled retail sales.\16\ CCEM also
argues that the Commission erred when it found that it lacks
jurisdiction over transmission service that is bundled with the sale of
power to a utility's retail native load.\17\ It argues that artificial
distinctions between wholesale and retail transactions should be
avoided. CCEM further argues that the Commission should insist that all
transmission providers and customers face the same unbundled market.
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\16\ CCEM Rehearing Request at pp. 5-6.
\17\ CCEM Rehearing Request at p. 5.
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Similarly, TAPS argues that the Commission's change in the
definition of ``wholesale merchant function'' unwisely narrows the
scope of the Standards of Conduct rules.\18\ TAPS further argues that a
Transmission Provider's use of its own transmission system to make
wholesale purchases for bundled retail load should not be exempted from
functional unbundling and functional separation requirements.\19\ TAPS
argues that the Commission erred by watering down the functional
unbundling requirements in the Standards of Conduct by excluding
wholesale purchases for bundled retail customers from the requirement
to functionally unbundle.
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\18\ TAPS Rehearing Request at pp. 3-5.
\19\ TAPS Rehearing Request at pp. 3-5.
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Commission Conclusion. Nothing in the rehearings convinces us to
modify the definition of ``wholesale merchant function'' or to
otherwise modify our decision on this issue reached in Order No. 889-A.
However, we will repeat here certain clarifications we have made in
response to similar arguments made in requests for rehearing of Order
No. 888-A.
Although we reiterate our view that the Commission does not have
jurisdiction over the rates, terms and conditions of bundled retail
service, as a practical matter, we do not believe that it is possible
to divide a single power purchase made on behalf of both wholesale and
retail native load such that the transmission provider takes service
under the open access non-rate terms and conditions for the part of the
purchase that goes to wholesale native load, but takes service under
different terms and conditions for the part of the purchase that goes
to retail native load. Because the power purchase transaction
(including the delivery across the transmission provider's system to
both wholesale and retail customers) is indivisible, and because the
transmission of the purchased power to the wholesale native load
customer must be done pursuant to the open access tariff, this means
that the entire transaction de facto must be pursuant to the non-rate
terms and conditions of the tariff.
Concerning the Standards of Conduct requirement that public
utilities separate their wholesale power marketing functions from their
[[Page 64719]]
transmission operations, the Commission did not require separation of
the retail power marketing function because the state has jurisdiction
over retail power marketing and over bundled retail transmission.
However, here too we believe further clarification is necessary. First,
the public utility has no choice pursuant to Order Nos. 888 and 888-A
but to separate its wholesale power marketing function (including power
purchase transactions made by the marketing function on behalf of
wholesale native load) from the transmission operations function. This
means that those persons in the company that are involved in wholesale
power purchases as well as wholesale sales cannot interact with the
transmission personnel other than through the OASIS. Thus, to the
extent they are making purchases on behalf of wholesale as well as
bundled retail native load as part of a single purchase, they will have
to abide by the separation of function requirement. As discussed above,
such a purchase is not divisible. Additionally, it is conceivable that
there could be a separate retail marketing function for native load and
a separate wholesale marketing function for native load. If a challenge
is made to the way a utility organizes its functions, then the utility
bears the burden of demonstrating that it is maintaining a separate
staff to perform retail marketing functions. Furthermore, in such
cases, it would clearly be inappropriate for the retail staff to share
transmission information with the wholesale marketing staff.
C. Section 37.6--Information To Be Posted on an Oasis
Transmission Discounting Policy
In Order No. 889-A, we explained that the Commission was adopting a
revised discounting policy in Order No. 888-A that necessitated changes
to the OASIS and Standards of Conduct regulations found in 18 CFR Part
37. These changes entailed three principal requirements.
First, any offer of a discount for transmission and/or ancillary
services made by the Transmission Provider must be announced to all
potential customers solely by posting on the OASIS.
Second, any customer-initiated requests for discounts of
transmission and/or ancillary services must occur solely by posting on
the OASIS, regardless of whether the customer is the Transmission
Provider's wholesale merchant function, an affiliate, or a non-
affiliate.
Third, once the Transmission Provider and customer agree to a
discounted transaction for transmission and/or ancillary services, the
details immediately must be posted on the OASIS. This requirement is
equally applicable regardless of whether the customer is the
Transmission Provider's wholesale merchant function, an affiliate, or a
non-affiliate.
Rehearing Request. On rehearing, TAPS argues that the Commission's
policy on transmission discounting should be modified to minimize the
potential for self dealing and other abuses.20 Specifically,
TAPS argues that the Commission's revised discounting policy in Order
No. 888-A, by allowing delivery point-specific discounts, offers a
means for transmission providing utilities to offer each other
reciprocal discounts, while requiring transmission dependent utilities
to pay full freight. TAPS argues that if a transmission provider offers
a discount to itself or any other transmission user, the transmission
provider should be required to offer the discount either on all
unconstrained paths, or, at a minimum, to all delivery points in the
same unconstrained portion of the transmission provider's transmission
system and to other similarly situated customers. TAPS argues that
there is no justification for a transmission provider to refuse to
offer a discount to delivery points located along the same electrical
path as the discounted transaction.21
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\20\ TAPS Rehearing Request at pp. 5-6.
\21\ TAPS Rehearing Request at p. 6.
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Commission Conclusion. In Order No. 888-B, being issued
concurrently with this order, the Commission has considered various
requests for rehearing of the discounting policy announced in Order
Nos. 888-A and 889-A. Among these requests for rehearing is that
submitted by TAPS, wherein TAPS raises the same discounting issue as
that raised in its request for rehearing of Order No. 889-
A.22/ As we are denying rehearing of this issue in Order No.
888-B, for the reasons discussed therein, we similarly deny rehearing
of this issue in this order.
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\22\ TAPS Rehearing Request of Order No. 888-A at pp. 17-20.
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As we explain in Order No. 888-B, the revised discounting policy
announced in Order No. 888-A is the result of a careful balancing of
incentives to operate the transmission grid efficiently while ensuring
that the grid is not operated in an unduly discriminatory manner. After
a review of the requests for rehearing, the Commission concludes, in
Order No. 888-B, that it properly balanced these concerns in Order No.
888-A. For this reason, the Commission denies the requests for
rehearing of this issue in Order No. 888-B, and we do the same here.
D. Section 37.6--Information to be Posted on an Oasis
Deletion of Masking Provision
In Order No. 889-A, the Commission deleted Sec. 37.6(e)(1)(iii) and
revised Sec. 37.6(e)(3)(I) to remove provisions that directed
Transmission Providers posting transmission service requests on the
OASIS to honor requests from parties to transactions to mask their
identities during the negotiating period and for 30 days from the date
when the request for service was accepted, denied, or withdrawn. The
Commission deleted the masking provision in response to certain
arguments raised on rehearing of Order No. 889 and to implement the
discounting policy announced in Order No. 888-A.
Rehearing Request. CCEM argues that the Commission erred by
eliminating the customer identity/transaction masking
provision.23 CCEM contends that this revision was not based
on reasoned decision-making. CCEM argues that by revealing a
transmission requester's identity, competitors--particularly public
utilities with captive native loads--can learn commercially sensitive
information that will allow them to misappropriate the service
requester's marketing efforts and transactions. CCEM argues that this
is a larger problem than it was previously because the Commission has
now expanded the information to be posted on the status of requests for
transmission and ancillary services to include information about: (1)
points of delivery and receipt; (2) length and type of service; and (3)
identification of ancillary service transactions associated with a
transmission service transaction.
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\23\ CCEM Rehearing Request at pp. 2-5.
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CCEM also argues that eliminating the 30-day masking provision
allows the Standards of Conduct to be undercut by allowing wholesale
merchant employees to obtain market information in a manner giving them
an advantage over unaffiliated marketers. CCEM does not agree that
masking inhibits market participants from making informed choices and
notes that all relevant information except a requester's identity
already would be available. CCEM argues that a requester's identity is
neither critical nor important to a competitor pursuing ``its own
interests''.
Commission Conclusion. We find CCEM's arguments unpersuasive. While
[[Page 64720]]
CCEM makes much of the so-called ``uneven playing field'' that it
allegedly will endure without the masking provision, we find this
concern to be unfounded. The Order No. 889 version of
Secs. 37.6(e)(1)(iii) and 37.6(e)(3)(I) treated all market participants
making a request for transmission service (or whose transactions were
curtailed or interrupted) equally, by allowing parties to such
transactions to mask their identities for thirty days, upon request.
The current (Order No. 889-A) version treats all market participants
making a request for transmission service (or whose transactions are
curtailed or interrupted) equally, by requiring the identity of parties
to such transactions to be posted. Although the Commission has revised
its policy on masking, all market participants making a request for
transmission service, whether affiliated or non-affiliated with the
Transmission Provider are treated equally in both instances. Thus,
under the revised rule, the playing field is just as level as before.
Moreover, we are not persuaded that eliminating the masking
provision will have the dire anticompetitive consequences that CCEM
predicts. To the contrary, we continue to believe that fuller
disclosure of customer and transaction information is necessary to
implement the discounting provisions added by Order Nos. 888-A and 889-
A and to ensure that customers (actual or potential) are able to detect
any affiliate abuse or undue discrimination.
If actual experience proves different, CCEM or other interested
persons may bring these facts to our attention and we will consider
taking appropriate remedial action.
V. Regulatory Flexibility Act Certification
The Regulatory Flexibility Act (RFA) 24 requires any
proposed or final rule issued by the Commission to contain a
description and analysis of the impact that the proposed or final rule
would have on small entities or to contain a certification that the
rule, if promulgated, will not have a significant economic impact on a
substantial number of small entities. Order No. 889 contained a
certification under section 605(b) of the RFA that the OASIS Final Rule
would not impose a significant economic impact on a substantial number
of small entities within the meaning of the RFA.25
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\24\ 5 U.S.C. 601-612.
\25\ See Order No. 889, FERC Stats. & Regs. at 31,628.
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Given that Order No. 889-A made only minor revisions to Order No.
889, none of which was substantive, that this order makes no revisions
to Order No. 889-A, and that we are granting waivers from the
requirements of the OASIS Final Rule to small entities where
appropriate, we reaffirm our earlier certification in Order Nos. 889
and 889-A that the requirements in 18 CFR Part 37, to establish and
participate in an OASIS and to comply with the Standards of Conduct,
will not have a significant economic impact on a substantial number of
small entities and that no regulatory flexibility analysis is required
pursuant to section 603 of the RFA.
VI. Environmental Statement
As explained in Order Nos. 888-A and 889-A, Order Nos. 888 and 889
were the joint subjects of the Final Environmental Impact Statement
issued in the Open Access NOPR proceeding in Docket Nos. RM95-8-000 and
RM94-7-001 on April 12, 1996. Given that this order makes no revisions
to Order No. 889-A, no separate environmental assessment or
environmental impact statement has been prepared in this proceeding.
VII. Information Collection Statement
As explained in Order Nos. 889-A, Order No. 889 contained an
information collection statement for which the Commission obtained
approval from the Office of Management and Budget (OMB).26
Given that Order No. 889-A made only minor revisions to Order No. 889,
none of which was substantive, and given that this order makes no
revisions to Order No. 889-A, OMB approval for this order will not be
necessary. However, the Commission will send a copy of this order to
OMB, for informational purposes only.
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\26\ OMB Control No. 1902-0173.
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The information reporting requirements under this order are
unchanged from those contained in Order No. 889-A. Interested persons
may obtain information on the reporting requirements by contacting the
Federal Energy Regulatory Commission, 888 First Street, N.E.,
Washington, D.C. 20426 [Attention Michael Miller, Information Services
Division, (202) 208-1415], and the Office of Management and Budget
[Attention: Desk Officer for the Federal Energy Regulatory Commission
(202) 395-3087].
The Commission Orders
As discussed in the body of this order, the requests for rehearing
are hereby denied.
By the Commission.
Lois D. Cashell,
Secretary.
[FR Doc. 97-31856 Filed 12-8-97; 8:45 am]
BILLING CODE 6717-01-P
