FERC Issues Letter Order Accepting Midway-Sunset Cogeneration Company's 6/28/14 Filing of an Updated Market Power Analysis in Compliance with Order...
(Targeted News Service Via Acquire Media NewsEdge) FERC Issues Letter Order Accepting Midway-Sunset Cogeneration Company's 6/28/14 Filing of an Updated Market Power Analysis in Compliance with Order No. 697, Request for Category 1 Status, and Tariff Revisions Under ER13-1845
WASHINGTON, March 19 -- The U.S. Department of Energy's Federal Energy Regulatory Commission issued the text of the following delegated order:
In Reply Refer To:
Midway-Sunset Cogeneration Company
Docket No. ER13-1845-000
March 19, 2014
Mr. Andrew B. Young
Attorney for Midway-Sunset Cogeneration Company
K&L Gates LLP
1601 K Street, NW
Washington, D.C. 20006
Reference: Updated Market Power Analysis in Compliance with Order No. 697, Request for Category 1 Status, and Tariff Revisions
Dear Mr. Young:
On June 28, 2013, you filed on behalf of Midway-Sunset Cogeneration Company (Midway-Sunset) an updated market power analysis for the Southwest region in compliance with the regional reporting schedule adopted in Order No. 697 and pursuant to the Commission's order granting Midway-Sunset authority to sell electric energy and capacity at market-based rates. You also submitted a request for Category 1 status representing that Midway-Sunset meets the criteria for Category 1 status in the Northeast, Southeast, Central, Southwest Power Pool, and Northwest regions. Finally, you submitted a revised tariff to incorporate the required provision adopted by the Commission in Order No. 697-A, and to make minor administrative changes.
Your filing was noticed on June 28, 2013, with comments, protests or interventions due on or before August 27, 2013. None was filed.
Pursuant to the authority delegated to the Director, Division of Electric Power Regulation - West, under 18 C.F.R. section 375.307, your submittal filed in the referenced docket is accepted for filing, effective June 29, 2013, as requested. Based on your representations, Midway-Sunset meets the criteria for a Category 2 seller in the Southwest region and a Category 1 seller in the Northeast, Southeast, Central, Southwest Power Pool, and Northwest regions and is so designated.
You state that Midway-Sunset owns an approximately 219 megawatt (MW) cogeneration facility located in Kern County, California in the California Independent System Operator Corp. (CAISO) market, and it is affiliated with approximately 14,290 MW of generation in the CAISO market. You further state that Midway-Sunset is owned by Aera Energy LLC and San Joaquin Energy Company (San Joaquin). You represent that Aera Energy LLC is owned by Shell Oil Company and Exxon Mobil Corporation, and that San Joaquin is a subsidiary of Edison Mission Energy. Additionally, you state that Midway-Sunset is affiliated with Southern California Edison Company (SCE), which owns transmission facilities in the CAISO market and has transferred operational control over its transmission facilities to CAISO, and therefore has mitigated any transmission market power. Further, you affirmatively state that Midway Sunset has not erected barriers to entry and will not erect barriers to entry into the relevant market.
You state that Midway-Sunset meets the criteria for Category 1 seller status in all regions, except for the Southwest region. You represent that Midway-Sunset owns generation in the Southwest region, and it does not own generation in any other regions. You also represent that Midway-Sunset does not own, operate, or control transmission facilities other than the limited equipment necessary to connect individual generating facilities to the transmission grid. You add that with exception of SCE, which is located in the Southwest region, Midway-Sunset is not affiliated with anyone that owns, operates, or controls transmission facilities. Lastly, you represent that other than SCE, Midway-Sunset is not affiliated with a franchised public utility, and does not raise any other vertical market power issues.
Market-Based Rate Authorization
The Commission allows power sales at market-based rates if the seller and its affiliates do not have, or have adequately mitigated, horizontal and vertical market power.
Midway-Sunset has prepared the pivotal supplier and wholesale market share screens for the CAISO market consistent with the requirements of Order No. 697, when the Commission-accepted Simultaneous Transmission Import Limit (SIL) study results are taken into consideration for the CAISO market.
Your horizontal market power screens have been reviewed, and you pass both the pivotal supplier and wholesale market share screens in the CAISO market when the Commission-accepted SIL values for those areas are applied. Based on your representations, your submittal satisfies the Commission's requirements for market-based rate authority regarding horizontal market power.
Based on your representations, Midway-Sunset's submittal also satisfies the Commission's requirements for market-based rate authority regarding vertical market power.
Midway-Sunset must file electronically with the Commission Electric Quarterly Reports. Midway-Sunset further must timely report to the Commission any change in status that would reflect a departure from the characteristics the Commission relied upon in granting market-based rate authority in accordance with Order No. 697.
This action does not constitute approval of any service, rate, charge, classification, or any rule, regulation, or practice affecting such rate or service provided for in the filed documents; nor shall such action be deemed as recognition of any claimed contractual right or obligation affecting or relating to such service or rate; and such acceptance is without prejudice to any findings or orders which have been or may hereafter be made by the Commission in any proceeding now pending or hereafter instituted by or against any of the applicant(s).
This order constitutes final agency action. Requests for rehearing by the Commission may be filed within 30 days of the date of issuance of this order, pursuant to 18 C.F.R section 385.713.
Questions regarding the above order should be directed to:
Federal Energy Regulatory Commission
Attn: Debra Irwin
Phone: (202) 502-6253
Office of Energy Market Regulation
888 First Street, N.E.
Washington, D.C. 20426
Steve P. Rodgers, Director
Division of Electric Power
Regulation - West
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