FERC Filings
EPSA's Protest On the OMS Offer of Proof
Recent Case Law Does Not Prevent IMMs or FERC From Obtaining Information Needed to Effectively Monitor Markets
The Offer asserts “approval of the Midwest ISO’s data access … is about states helping FERC do its job” and states in support of that position that the decision in Electric Power Supply Association v. FERC, No. 03-1182 (D.C. Cir., December 10, 2004) (“Ex-Parte Decision”) will prevent market monitor information from being considered by FERC in various administrative proceedings. OMS suggests these FERC proceedings include whether: (i) a generator violated RTO rules such that its market-based rate authority should be revoked; (ii) transmission shortages will reduce import capacity and necessitate pricing relief and monitoring prices; and (iii) a transmission owner is complying with agreed-upon maintenance schedules. Rather than getting information from the market monitor in these proceedings, the Offer asserts that the Commission can get the information from the state commission and the regional state committee, which will have on-going access to the data and will participate in FERC proceedings as a witness.
The Offer of Proof evidences an interpretation of the Ex-Parte decision with which EPSA fundamentally disagrees. The ex-parte rules only prohibit communications relevant to the merits of contested, on the record proceedings. In the event such communications occur, the communications must be disclosed so that the parties’ due process rights can be protected through the opportunity to respond and create an administrative record for possible appeal.
The ex-parte rules (and the Ex-Parte Decision that rejected the Commission’s decision to relieve market monitors from complying with those rules) will not limit the Commission’s ability to monitor wholesale markets. For example, nothing prohibits the Commission from gathering background information on the current state of wholesale markets, such as transmission shortages or compliance with agreed upon maintenance schedules. The ex-parte rules only prohibit communications relevant to the merits of a matter, and such communications do not include a “general background or broad policy discussion … outside the context of any particular proceeding involving a party or parties and does not address the specific merits of the proceeding.” Moreover, the ex-parte rules will not prohibit the Commission from investigating conduct such as violations of RTO market rules and tariff conditions that impact the current state of wholesale markets. The ex-parte rules only prohibit ex-parte communications in contested on-the-record proceedings, and they specifically exclude FERC investigations.
To be sure, in contested on-the-record proceedings, such as a hearing to revoke market-based rate authority, the Ex-Parte Decision will prohibit the market monitor from having ex-parte communications with the Commission on matters that would be relevant to the merits, i.e. capable of affecting the outcome or of influencing a decision, or providing an opportunity to influence a decision, of whether market-based rate authority should be revoked. In the event such communication does occur, it must be disclosed. Nothing in the Ex Parte decision prevents a market monitor from testifying in a contested proceeding, nor does it prevent the Commission from requesting state of the market or similar reports from a market monitor. In short, prohibiting ex-parte communications in these situations, however, protects parties’ due process rights and does nothing to limit the ability of the Commission to monitor wholesale markets.
The Commission has at its disposal all of the tools it needs to monitor activity in the wholesale markets over which it has exclusive jurisdiction. The Ex-Parte Decision does nothing to change that. Thus, contrary to the Offer’s assertion, “helping FERC do its job” is not a compelling reason for the Commission to grant the OMS states broader access to confidential data than it did with PJM.