01-17007. Open Access Same-Time Information System and Standards of Conduct

Issued June 29, 2001.

AGENCY:

Federal Energy Regulatory Commission.

ACTION:

Order Denying Request for Experimental Business Practice Standard.

SUMMARY:

The Federal Energy Regulatory Commission is denying a request to authorize a 6-month experiment implementing a business practice standard that would allow transmission providers, at the time of reservation request deadlines, to retract their prior acceptances of unconfirmed customer requests for daily firm transmission service and substitute pending pre-confirmed requests for such service, in order of queue time, up to the amount of daily firm available transmission capability remaining.

FOR FURTHER INFORMATION CONTACT:

Marvin Rosenberg (Technical Information), Office of Markets, Tariffs, and Rates, Federal Energy Regulatory Commission 888 First Street, NE., Washington, DC 20426, [phone].

Paul Robb (Technical Information), Office of Markets, Tariffs, and Rates, Federal Energy Regulatory Commission 888 First Street, NE., Washington, DC 20426, [phone].

Gary D. Cohen (Legal Information), Office of the General Counsel, Federal Energy Regulatory Commission 888 First Street, NE.,Washington, DC 20426,[phone].

SUPPLEMENTARY INFORMATION:

Order Denying Request for Experimental Business Practice Standard

We will deny the request from the Market Interface Committee of the North American Electric Reliability Council (MIC) for expedited approval of its proposed experiment on the treatment of unconfirmed requests for daily, firm transmission service, for the reasons stated below.

Background

On May 29, 2001, the MIC filed a request to modify the Commission's OASIS Business Practice Standards adopted in Order No. 638,^[1] to add a new business practice standard dealing with accepted daily, firm point-to-point transmission service that has not been confirmed and to modify a related footnote to Table 4-2 on Reservation Timing Limits. The MIC requests that the Commission implement this proposal on a mandatory, experimental basis for six months beginning no later than June 30, 2001. The MIC further states that, within four months of the effective date, it will provide the Commission with an assessment of the experiment and whether it should be revised, discontinued, or made permanent.

On June 5, 2001, the Commission issued a notice of filing and request for comments regarding the MIC filing (66 FR 31234, June 11, 2001). The notice gave a brief description of the MIC proposal and invited comments on or before June 11, 2001.^[2] Comments were invited on the MIC proposal generally and specifically on whether Commission action is needed by June 30, 2001, as requested by the MIC.

On June 11, 2001, Dynegy Power Marketing, Inc. and Coral Power, LLC (collectively “Dynegy/Coral”) jointly filed a protest opposing the MIC request. Dynegy/Coral argue that the MIC proposal should not be granted on an expedited basis and that it should be rejected outright. Dynegy/Coral's protest was the sole comment filed in response to the June 5, 2001 notice and request for comments.

Discussion

We will deny the MIC's request for expedited approval of its proposed experiment on the treatment of unconfirmed requests for daily, firm transmission service for three reasons. First, although the MIC requests expedited approval of its proposed experiment, the MIC's proposal presents no reason why expedited treatment is needed. Moreover, although our June 5, 2001 notice specifically invited comment on this issue, no comments were filed in support of expedited treatment or giving reasons why prompt action is needed. In fact, Dynegy/Coral's protest, the sole comment filed, argued against expedited approval of the proposed experiment both because it opposed approval of the experiment outright, and because Dynegy/Coral argues that implementation during the summer peak period would cause problems for customers denied service under the MIC's proposal. Given the absence of a showing of need for expedited treatment, we will reject MIC's request for expedited approval of its proposed experiment.

The MIC proposal would allow transmission providers, at reservation request deadlines, to retract their prior acceptance of unconfirmed customer requests for daily, firm transmission service and substitute pending pre-confirmed requests for such service, in order of queue time, up to the amount of daily, firm available transmission capability remaining. The proposal includes phrases such as, “the transmission provider has the right to move to a retracted status” and “after which time that request may be retracted.” These phrases do not provide a standard for the transmission provider to use in deciding whether to retract customers' unconfirmed accepted requests for daily, firm point-to-point transmission service. Careful monitoring would be necessary to insure that the proposal is not implemented in a discriminatory manner. A customer whose request for transmission service had been accepted would have no way to predict whether a transmission provider might choose to retract its acceptance, which would make it difficult for the customer to make alternative arrangements.

Dynegy/Coral argues that the proposed standard addresses the problem of unused transmission capacity caused by some customers not confirming accepted transmission requests, but does not address the underlying problem caused by the practice of some transmission providers of delaying their acceptance of requests for daily, firm transmission service, even when customers submit their requests early. Dynegy/Coral contends this practice puts customers in a bind that forces them to make alternative arrangements as a protective mechanism. Dynegy/Coral argues that customers should not be punished for taking such precautions, even if they result in some unused transmission capacity. Dynegy/Coral argues that a better solution to avoid unused capacity would be for transmission providers to more uniformly respond to requests for daily, firm transmission service on a timely basis, rather than by taking the unwarranted step of giving greater priority to pre-confirmed service requests. Further, Dynegy/Coral argues that the MIC proposal would force customers to purchase transmission services they will be unable to use.

We agree with Dynegy/Coral that the MIC proposal does not address whether the time period for transmission providers to evaluate requests for daily, firm transmission service needs to be clarified or shortened and that this is a relevant issue. If transmission providers would all respond to requests for daily, firm transmission service on a timely basis, then customers would have adequate time to confirm before reservations are scheduled, and the MIC's proposed business practice might not be needed. We request that the MIC reconsider its motion in light of the concerns raised by Dynegy/Coral. After considering these issues, the MIC may, at its option, make a revised request for an experimental business practice standard.

The Commission orders

The request by MIC for expedited approval of a proposed experiment on the treatment of unconfirmed requests for daily, firm transmission service is hereby denied without prejudice, as discussed in the body of this order.

By the Commission.

(SEAL)

David P. Boergers,

Secretary.

Footnotes

1.  Open Access Same-Time Information System and Standards of Conduct, Order No. 638, FERC Stats. & Regs., Regulations Preambles 1996-2000 ¶ 31,092 (2000).

2.  This shortened comment period was used to accommodate the MIC's request for action on or before June 30, 2001.