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FERC Orders, Notices, and Other Guidance Regarding the Novel Coronavirus

Last week the Federal Energy Regulatory Commission (“FERC”) continued to issue orders, notices, and guidance related to the current novel coronavirus pandemic, the health and safety of FERC and energy industry employees, and the continued reliability of the U.S. energy sector.  A summary of FERC’s relevant actions are provided below, including information regarding FERC’s operating status, extensions for filing deadlines and efforts to ease regulatory burdens during this crisis.

  • Essential Services

    • Joined with the National Association of Regulatory Utility Commissioners (“NARUC”) in urging all state authorities to designate utility workers as essential to the nation’s critical infrastructure. FERC and NARUC supported the federal government’s “designations in support of the energy, water and telecommunications industries, finding it in the best interests of the nation for state and local authorities to assign essential worker status to employees serving in these areas of critical infrastructure.”  FERC and NARUC also “stressed the importance of prioritizing cyber security during this pandemic.”

  • FERC Resources

  • General FERC Business

    • Closed FERC’s offices to the public and authorized all FERC employees to telework. FERC’s Executive Director “stressed that FERC remains fully functional via its telework capabilities with more than 1,400 employees nationwide working remotely.”

    • Cancelled or postponed all in-person meetings.

    • Rescheduled or conducted technical conferences via WebEx.

  • Request to Extend CPFF

    • Supported energy industry groups’ request to the Federal Reserve to extend Commercial Paper Funding Facility (“CPFF”) purchasing to commercial paper programs that are rated at A2/P2/F2 Tier 2 by at least two of the major credit rating agencies. Tier 2 companies are active in sectors that represent essential infrastructure, including electric and natural gas utilities.  FERC argued that electric and natural gas utilities “continued financial stability and their ability to continue to support the country’s essential infrastructure are supported by ready access to short-term debt.”

  • Cost Recovery, Filing Deadlines, Filing Requirements, Tariff Meetings, and Other Forms of Relief

    • Issued a Policy Statement that FERC will expeditiously review and act on requests for relief in response to the coronavirus, “including but not limited to, requests for cost recovery necessary to assure business continuity of the regulated entities’ energy infrastructure in response to the national emergency.” FERC recognized that regulated entities may need to take actions to safeguard the business continuity of their systems, and that FERC will give its “highest priority” to processing filings made for that purpose.

    • In two notices, extended certain deadlines to May 1, 2020 for those entities that are unable to meet the deadlines due to steps taken in response to the emergency conditions caused by the novel coronavirus pandemic. These deadlines include:

      • Filing forms required by FERC, with the exception of FERC Form No. 6, Annual Report of Oil Pipeline Companies;

      • Filings required by tariffs or rate schedules; and

      • Other non-statutory filings required by FERC, including, but not limited to:

        • Compliance filings;

        • Responses to deficiency letters;

        • Rulemaking comments;

        • Answers to complaints and orders to show cause with deadlines that occur on or before May 1, 2020;

        • Initial and reply briefs in paper FERC hearings with deadlines that occur on or before May 1, 2020;

        • Interventions, protests, or comments to a complaint; and

        • Briefs on and opposing exceptions to an initial decision.

      • Explained that entities may file motions to extend procedural schedules and seek waiver of FERC orders, regulations, tariffs and rate schedules to address needs resulting from steps they have taken in response to the coronavirus.

        • The deadline for answers to motions for such extensions of time for a filing is shortened from 5 days to 3 days.

        • The deadline for comments for motions seeking waiver of requirements set forth in FERC’s orders, regulations, tariffs, rate schedules, and service agreements in response to the emergency conditions is shortened from 21 days to as short as 5 days.

      • Delegated authority to the Director, Office of Energy Market Regulation, or the Director’s designee, to take action on uncontested requests for waiver of certain regulatory obligations to address needs resulting from steps entities have taken to meet the emergency conditions caused by the coronavirus.

      • Delegated authority to the Director of the Office of Energy Policy and Innovation, or the Director’s designee, to take appropriate action on motions for extension of time to file, or requests or petitions for waiver of the requirements of, FERC Form No. 552 (Annual Report of Natural Gas Transactions) and FERC-730 (Report of Transmission Investment Activity).

      • Approved a blanket waiver of Open Access Transmission Tariff (“OATT”) requirements (1) to hold meetings in-person and (2) to provide or obtain notarized documents. The waiver will remain in place through September 1, 2020.  FERC noted that alternatives to notarization and in-person meetings, such as electronic signatures and secure telephonic or web-based meeting capabilities, are available.

      • Extended the time period for Regional Transmission Operators (“RTOs”) and Independent System Operators (“ISOs”) to post all Uplift Reports and Operator Initiated Commitment Reports. The time period for all reports that otherwise would have been required to be posted between April 2020 and September 2020 is extended to October 20, 2020.

    • Hearings and Settlement Conferences

      • Postponed all hearings until they could be safely rescheduled.

      • Any oral arguments would be held by WebEx.

      • Required that all settlement conferences be conducted by telephone.

    • Office of Enforcement

      • Postponed all previously scheduled audit site visits and investigative testimony. FERC’s Director of the Office of Enforcement has noted that “all of FERC’s enforcement capabilities remain fully functional and we continue to engage with the market monitors to ensure that our competitive energy markets are properly functioning.”

    • FERC and NERC Guidance to Ensure Grid Reliability

      • Announced with the North American Electric Reliability Corporation (“NERC”) that:

        • The “effects of the coronavirus will be considered an acceptable basis for non-compliance with obtaining and maintaining personnel certification, as required in Reliability Standard PER-003-2, for the period of March 1, 2020 to December 31, 2020. Registered entities should notify their Regional Entities and Reliability Coordinators when using system operator personnel that are not NERC-certified.”

        • The “effects of the coronavirus will be considered an acceptable reason for case-by-case non-compliance with Reliability Standard requirements involving periodic actions that would have been taken between March 1, 2020 and July 31, 2020. Registered entities should notify their Regional Entities of any periodic actions that will be missed during this period.”

        • “Regional Entities will postpone on-site audits, certifications and other on-site activities at least until July 31, 2020. Registered entities should communicate any resource impacts associated with remote activities to their Regional Entities.”

As you are aware, things are changing quickly and there is no clear-cut authority or bright line rules.  This is not an unequivocal statement of the law; instead, it represents our best interpretation of where things currently stand.  This article does not address the potential impacts of the numerous other local, state, and federal orders that have been issued in response to the COVID-19 pandemic.

Copyright © 2020, Sheppard Mullin Richter & Hampton LLP.

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About this Author

William M. Rappolt Real Estate Lawyer Sheppard Mullin Law Firm
Associate

Bill Rappolt is an associate in the Real Estate, Land Use and Environmental Practice Group and a member of the Energy Industry Team in the firm's Washington, D.C. office.

Areas of Practice

Bill has worked in the field of energy regulation since 2003 and has been a practicing attorney in the field since 2010. Bill’s practice includes representing participants in the natural gas, electric and oil/liquids industries before federal agencies, state utility commissions and appellate courts. Bill has represented natural gas pipelines and storage providers, electric...

202-747-3317
Mark F. Sundback Partner DC Bankruptcy and Restructuring Environmental Real Estate and Land Use Real Estate Acquisitions and Dispositions
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Mark F. Sundback is a Partner in the Real Estate, Land Use and Environmental Practice Group in the firm's Washington, D.C. office.

Areas of Practice

Since 1981 Mark has been extensively engaged in the representation of energy industry participants before federal and state agencies charged with jurisdiction over energy markets and their participants. His representations have focused on the rates, terms and conditions associated with gaining access to regulated energy transmission systems, transactions involving changes in ownership of jurisdictional assets and unbundling matters.

Retail Electric

Mark has been involved in rate proceedings with regard to retail electric service of numerous utilities including Florida Power & Light, Tampa Electric, Duquesne Light, Allegheny Power Utility subsidiaries, First Energy utility subsidiaries, and other utilities in various jurisdictions including Texas, Maryland and Washington, DC. He also has appeared before the regulatory commissions of numerous states.

Wholesale Electric

With regard to wholesale electric service, Mark has been involved in proceedings involving unbundling transmission, distribution and generation rates in PJM and ERCOT. He has been involved in counseling multiple independent merchants of electric power, and in filings on their behalf with the FERC. His work frequently requires the integration of both transactional and regulatory goals. He has been involved in counseling clients in the SERC and ISO-NE regions. He also has been involved in arbitrations involving interpretations of ISO rules and technical aspects of tariff provisions. He also has represented RTOs on issues regarding resource adequacy. Mark has successfully represented entities against RTO claims in arbitration. 

Mark has successfully defended TransCanada Energy from claims by inter alia the California Public Utilities Commission and California’s Attorney General of unlawful market conduct in proceedings arising from the West Coast power crisis in 2000-2001.

He has served as chief energy regulatory counsel in bankruptcy proceedings, involving bankrupt electric generators and their creditors. 

Natural Gas

Mark has been involved in FERC proceedings related to regulation of pipelines since 1981. He has represented several natural gas companies, and has for decades served in a first chair capacity in hearings before the Commission as well as judicial appeals. He has been involved in precedent-setting cases concerning rates, certificates and accounting regulation of natural gas companies, and the scope of FERC’s jurisdiction under the Natural Gas Act, the Outer Continental Shelf Lands Act and the Natural Gas Policy Act.

202-747-1946
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