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Why My Tariff is Different Than Yours: Comparing Nonprice Terms in Utility Filings Against FERC's Pro Forma Tariffs

Fortnightly Magazine - May 1 1996

market-based rate requests from six utilities: Northeast Utilities, Duke Power, Western Resources, PacifiCorp Power Marketing, Wisconsin Public Service Co., and Cleveland Electric Illuminating Co. (Duke eventually received approval; Wisconsin Public Service later withdrew its tariff.) The main sticking point has been the FERC's contention that it cannot assume that a utility has fully mitigated its market power in transmission unless its open-access tariff substantially conforms to the pro forma version, or contains terms and conditions superior to the FERC tariffs.

More recently, in three cases, the FERC has denied requests for market-based rates for utility-affiliated power marketers because the utility tariffs restrict service to so-called "section 211/212 entities." (Federal Power Act sections 211 and 212, as amended by EPAct, pertain to certain wheeling authority enjoyed by the FERC in limited situations on behalf of wholesale power entities such as qualifying cogeneration and small power production facilities, rural electric cooperatives, public power utilities, the federal power marketing agencies, independent power producers, and investor-owned utilities.)

The FERC had accepted such restrictions in the past, but has now reversed itself without explanation. Possible reasons for this change in policy include the future submission of unbundled, retail transmission tariffs, and the many price and nonprice provisions in sections 211 and 212 that the FERC may consider too difficult to define or administer. A flurry of filings from utilities with market-based rate approval urged the FERC to remove the service restrictions for section 211 parties from the open-access transmission tariffs. In response, the FERC softened its policy to allow utilities that request market-based rates 15 days to conform to the pro forma tariffs.

The differences between the utility and pro forma tariffs illustrate the terms of the debate between utilities and customers concerning third-party use of a transmission system. The FERC's final open-access rule will directly address the issues raised by these filings, but debate will likely continue. t

Kevin Porter is a policy analyst at the National Renewable Energy Laboratory's Washington, DC, office.

Tariff Filings Discussed Here

Citizens Utilities ER95-1586-000

Cleveland Electric Illuminating ER95-1104-000

Commonwealth Edison ER95-1586-000

Commonwealth Electric ER95-1453-000

Delmarva ER95-0222-000

Duke Power ER95-0755-000 and ER96-0110-000

Florida Power Corp. ER95-1536-000

General Public Utilities ER95-0791-000

Idaho Power ER96-0350-000

Nevada Power ER96-0447-000

Northeast Utilities ER96-0496-000 and ER95-1686-000

Northern Indiana Public Service ER96-0399-000

PacifiCorp ER95-1240-000

PacifiCorp Power Marketing ER95-1096-000

Portland General Electric ER96-0333-000

Public Service of Colorado ER95-1268-000

San Diego Gas & Electric ER96-0043-000

Southwestern Public Service ER95-1138-000

UtiliCorp United Inc. ER95-0203-000

Western Resources ER96-0459-000 and ER95-1515-000

Wisconsin Public Service ER95-1528-000 and ER96-0439-000

1 Promoting Wholesale Competition Through Open-Access NonDiscriminatory Trans. Servs. by Pub. Utils., Dkt. RM95-8-000, and Recovery of Stranded Costs by Pub. Utils. and Transmitting Utils., Dkt. RM94-7-001, March 29, 1995, 70 FERC (pp 61,357.

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