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Mar 25, 2020

FERC Announces Policies and Procedures to Continue Work During COVID-19 Emergency

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FERC ANNOUNCES POLICIES AND PROCEDURES TO CONTINUE WORK DURING COVID-19 EMERGENCY

Late last week, Federal Energy Regulatory Commission (FERC) Chairman, Neil Chatterjee, announced in a statement and a teleconference with reporters held in lieu of FERC’s March 19 open meeting, how FERC will conduct business during the COVID-19 emergency.

FERC’s headquarters in Washington, D.C. is closed to nearly all outside visitors, and most of its staff is teleworking. Technical conferences, hearings, and other meetings that have not been cancelled or postponed are being conducted via conference call or teleconference. The three sitting FERC Commissioners voted notationally on the orders that were to have been considered at the March 19 open meeting.

FERC’s Office of Enforcement postponed all previously scheduled audit site visits and investigative testimony, and has been directed to act expeditiously in granting extensions and waivers of compliance filings, forms and Electric Quarterly Reports (EQRs), as appropriate. In his statement, Chairman Chatterjee said “I want to be clear that we plan to exercise our enforcement discretion to take these extenuating circumstances into account as we evaluate compliance and enforcement matters.”

FERC also extended, until May 1, 2020, the deadlines for filings required by FERC for entities that are unable to meet deadlines due to steps they have taken to meet emergency conditions arising from COVID-19. Specifically, FERC extended the deadlines for filing (1) forms required by FERC, with the exception of FERC Form No. 6, “Annual Report of Oil Pipeline Companies,” which must be filed by April 20, 2020, (2) other non-statutory filings required by FERC, such as compliance filings, responses to deficiency letters and rulemaking comments, and (3) other filings required by entities’ tariffs or rates schedules. FERC also said that entities may seek waiver of FERC’s orders, regulations, tariffs and rate schedules, as appropriate, to address needs resulting from steps they have taken in response to the coronavirus.[1]

FERC and the North American Electric Reliability Corporation (NERC), which ensures the reliability of the electricity grid, also announced steps they are taking to ensure that operators of the bulk electric system can focus on “keeping people safe and the lights on” during the COVID-19 emergency, including using regulatory discretion to consider the effects of coronavirus as an acceptable basis for non-compliance with certain Reliability Standards. Regional reliability entities will postpone on-site audits and other on-site activities until at least July 31, 2020.

In a separate statement issued on March 19 on “COVID-19 & FERC Orders,” Commissioner Richard Glick commended Chairman Chatterjee for extending filing deadlines “where [FERC] has flexibility,” and expressed the hope that FERC would “proceed judiciously over the next several months on orders that are not statutorily mandated.” He pointed out that the Federal Power Act and the Natural Gas Act require parties to seek rehearing of orders within 30 days of the date FERC issues that order, a requirement that FERC cannot waive, and argued that FERC should “refrain from acting to allow parties who are otherwise dealing with this pandemic to avoid putting resources toward seeking rehearing of a [FERC] order.” During his press conference, Chairman Chatterjee rejected Commissioner Glick’s suggested reticence, contending that the energy bar should be able to meet statutory rehearing deadlines via telework.

One of the “not statutorily mandated” orders that may have been on Commissioner Glick’s mind is the pending Notice of Proposed Rulemaking (NOPR) issued by FERC September, in which it proposes to revise its regulations implementing the Public Utility Regulatory Policies Act of 1978 (PURPA) (PURPA NOPR).[2] It is anticipated that FERC will issue an order, which may be a final rule containing one or more of the proposals in the PURPA NOPR, by the third quarter of 2020. Commissioner Glick dissented in part from the PURPA NOPR, arguing that many of the proposed changes to FERC’s PURPA regulations are inconsistent with its responsibilities under PURPA to, among other things, encourage development of qualifying facilities (QFs), and further, that a policy debate about the continued relevance of PURPA is an issue for Congress—as opposed to FERC—to resolve. In a January 27 letter to Rep. Paul Mitchell (R-MI), Chairman Chatterjee expressed his belief that “it is high time to bring PURPA into the 21st century and this NOPR represents a significant step towards doing that.”[3]

Footnotes

[1]  Extension of Non-Statutory Deadlines, “Notice Granting Extension of Time,” Docket No. AD20-11-000 (Mar. 19, 2020).
[2]  Qualifying Facilities Rate and Requirements, et al., “Notice of Proposed Rulemaking,” Docket Nos. RM19-15-000, et al., 168 FERC 61,184 (2019).
[3]  See Docket No. RM19-15-000.

Authors and Contributors

Donna J. Bobbish

Counsel

Project Development & Finance

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Robert Freedman

Partner

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New York