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Station Power Must Remain FERC Jurisdictional
"In deciding how much of a generators' output is used to satisfy station power requirements (and how much of its station power requirements are fulfilled through third-party retail sales), the state would also be determining how much a generators' total output is available for transmission and sale at wholesale."
WASHINGTON, D.C. - The Electric Power Supply Association (EPSA) has filed a request with the Federal Energy Regulatory Commission (FERC) seeking rehearing of the agency's order on remand from the Court of Appeals for the D.C. Circuit addressing the Commission's authority to determine when and to what extent a generator has self-supplied its station power requirements. "Station power" refers to electricity consumed on-site for the generator's own use (e.g., to operate heating, lighting, air-conditioning and office equipment).
In a filing late yesterday, EPSA and others stress that the agency's August 30th order disregards almost ten years of settled precedent, erroneously concluding that the Commission has no authority over this essential part of generating energy and allowing states to dictate if and to what extent a generator has self-supplied station power. Although the court of appeals merely concluded that the Commission had not adequately explained the jurisdictional basis for FERC's long-standing station power policies, EPSA strongly believes that the Commission badly misread the Court's decision as concluding that the Commission has no authority over this traditional generator practice. The result is an abdication of the Commission's exclusive jurisdiction and its statutory obligation to prevent undue discrimination. If states are permitted to dictate the appropriate netting interval, generators will be prevented from being fully and fairly compensated, resulting in undue discrimination between incumbent and merchant generators in the FERC-regulated wholesale markets.
EPSA's filing states, "In deciding how much of a generator's output is used to satisfy station power requirements (and how much of its station power requirements are fulfilled through third-party retail sales), the state would also be determining how much a generators' total output is available for transmission and sale at wholesale." EPSA argues that the Commission has jurisdiction to determine what amount of a generator's total output is used to satisfy its station power requirements and what amount is available for transmission and sale at wholesale. EPSA further contends that when the Commission sets an appropriate netting interval, it necessarily preempts conflicting state rules, and that the Commission's order on remand fails to justify its radical departure from the established precedent that previously recognized that FERC has exclusive jurisdiction to regulate station power. EPSA is concerned that by failing to comply with the statutory requirements, the Commission is diminishing generators' ability to compete in the wholesale marketplace.
Commenting on the filing, EPSA President & CEO John Shelk said, "The combination of eroding revenue streams and increased costs such as those for station power, could ultimately lead to situations in which supply sources necessary for the continued reliable and affordable operation of the electric grid become less economic to operate."
CONTACT: JOHN SHELK
(202) 349-0154or 703-472-8660
EPSA is the national trade association representing competitive power suppliers, including generators and marketers. These suppliers, who account for nearly 40 percent of the installed generating capacity in the United States, provide reliable and competitively priced electricity from environmentally responsible facilities serving global power markets. EPSA seeks to bring the benefits of competition to all power customers.