The NARUC 2012 Winter Committee Meetings were full of informative sessions. With over 700 people in attendance, the Forum on Reliability and the Environment was definitely one of the popular meetings. The crowd paid close attention to the presentation by EPA Administrator Gina McCarthy as she defended the Mercury and Air Toxics Standards (“MATS”) Rule and Cross State Air Pollution Rule (“CSAPR”) laws designed to provide a healthier environment. Among the key concerns addressed during the forum were: “What impact would the new laws have on electric reliability?” and “Does the so called MATS fifth year exemption really require noncompliance for up to a year?”

Although there were obviously various views between the agencies, particularly about the amount of coordination done by EPA, the tone was generally congenial. DOE was on hand to offer technical assistance to public utility commissions, generation operators and utilities. FERC’s general counsel discussed a recent white paper issued by FERC that seeks to create a fair and transparent process for utilities requesting extensions of time. Taking advantage of leap year, comments are due February 29, 2012. Highlights from the white paper are:

  • Each request for an EPA administrative order should be filed with the Commission Secretary’s Office as an informational filing that includes the same information submitted to EPA.
  • FERC’s Office of Electric Reliability will be the lead office in processing all such requests. Commission review would be limited to whether, based on the circumstances presented, there might be a violation of a Commission-approved Reliability Standard.
  • FERC would submit written comments on each request to EPA.
  • There would be no interventions in the FERC process; however, the Commission may, when appropriate, consider comments submitted as part of the informational filing in developing its written comments to EPA. 

Despite FERC’s process, the final decision on extensions will reside with EPA, which issued a Policy Memorandum on the subject last December.

John Bear, President and CEO of MISO, highlighted three areas of concern in his RTO: (1) outage coordination; (2) supply chain feasibility; and (3) gas infrastructure upgrades to insure resource adequacy. His points are interesting, particularly the supply chain concern. As many utilities take steps to comply, necessary equipment may not be available in time. Commissioner Thomas Welch of Maine raised an important issue on behalf of those utilities who have already taken measures to meet strict environmental standards. Many have higher rates as a result of upgrades and a delay in enforcement of the rules can create an unfair advantage. He urged a very rigorous regulatory review before extensions are granted. Everyone agrees the dialog needs to continue… Stay tuned.