[Federal Register Volume 71, Number 227 (Monday, November 27, 2006)]
[Proposed Rules]
[Pages 68495-68496]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-19998]


 ========================================================================
 Proposed Rules
                                                 Federal Register
 ________________________________________________________________________
 
 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
 ========================================================================
 

  Federal Register / Vol. 71, No. 227 / Monday, November 27, 2006 / 
Proposed Rules  

[[Page 68495]]



DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Parts 35 and 37

[Docket Nos. RM05-25-000 and RM05-17-000]


Preventing Undue Discrimination and Preference in Transmission 
Service

November 15, 2006.
AGENCY: Federal Energy Regulatory Commission, DOE.

ACTION: Notice of Request for Supplemental Comments.

-----------------------------------------------------------------------

SUMMARY: On May 19, 2006, the Commission issued a Notice of Proposed 
Rulemaking (NOPR) in this proceeding. Preventing Undue Discrimination 
and Preference in Transmission Service, 71 FR 32636 (June 6, 2006). In 
the NOPR, the Commission proposed, inter alia, to modify the redispatch 
obligations associated with long-term firm point-to-point service and, 
in addition, sought comments on whether the creation of a conditional 
firm product would represent a superior approach to address 
circumstances under which firm transmission service can be provided in 
most, but not all, of the hours of the request. Based on the comments 
received in response to the NOPR, the Commission is seeking further 
comment on the following two topics: the proposal of the Transparent 
Dispatch Advocates for transmission providers to post redispatch cost 
information and provide real-time redispatch; and specific questions 
related to the provision of conditional firm service.

DATES: Comments are due December 15, 2006.

ADDRESSES: You may submit comments, identified by Docket Nos. RM05-25-
000 and RM05-17-000, by one of the following methods:
     Agency Web Site: http://www.ferc.gov. Follow the 
instructions for submitting comments via the eFiling link found in the 
Comment Procedures section of the preamble of the May 19, 2006 NOPR.
     Mail: Commenters unable to file comments electronically 
must mail or hand deliver an original and 14 copies of their comments 
to: Federal Energy Regulatory Commission, Office of the Secretary, 888 
First Street, NE., Washington, DC, 20426. Please refer to the Comment 
Procedures section of the preamble of the May 19, 2006 NOPR for 
additional information on how to file paper comments.

FOR FURTHER INFORMATION CONTACT:
Daniel Hedberg, Office of Energy Markets and Reliability, Federal 
Energy Regulatory Commission, 888 First Street, NE., Washington, DC 
20426, (202) 502-6243, [email protected].
Jennifer Amerkhail, Office of Energy Markets and Reliability, Federal 
Energy Regulatory Commission, 888 First Street, NE., Washington, DC 
20426, (202) 502-8650, [email protected].
Mason Emnett, Office of the General Counsel--Energy Markets, Federal 
Energy Regulatory Commission, 888 First Street, NE., Washington, DC 
20426, (202) 502-6540, [email protected].

SUPPLEMENTARY INFORMATION:

Notice of Request for Supplemental Comments

    On May 19, 2006, the Commission issued a Notice of Proposed 
Rulemaking (NOPR) in this proceeding. Preventing Undue Discrimination 
and Preference in Transmission Service, 71 FR 32,636 (June 6, 2006), 
FERC Stats. & Regs. ] 32,603 (2006). In the NOPR, the Commission 
proposed, inter alia, to modify the redispatch obligations associated 
with long-term firm point-to-point service and, in addition, sought 
comments on whether the creation of a conditional firm product would 
represent a superior approach to address circumstances under which firm 
transmission service can be provided in most, but not all, of the hours 
of the request. Based on the comments received in response to the NOPR, 
the Commission is seeking further comment on the following two topics:

1. Transparent Dispatch Advocates (TDA) Proposal

    In Reply Comments submitted on September 20, 2006, the TDA 
submitted a proposal that, among other things, would require 
transmission providers to: (1) Post the real-time cost estimate of 
providing redispatch service from their resources at congested 
locations; (2) accept bids from third parties that choose to offer and 
are capable of providing redispatch service; and (3) provide real-time 
redispatch to resolve transmission constraints. In order to provide an 
opportunity for others to respond to the TDA proposal, the Commission 
is allowing an additional period to file comments on the proposal 
generally and, more specifically, the following questions:
     Is the TDA proposal required to remedy undue 
discrimination?
     What are the implementation impediments to requiring 
greater transparency of redispatch cost information? For example, if 
long-term point-to-point service is granted based on redispatch of the 
transmission provider's generation, would it be reasonable to require 
the transmission provider to post its daily or hourly redispatch cost 
for the constraint implicated by that request?
     Are there confidentiality or anticompetitive issues 
associated with requiring posting of this type of information? Are any 
concerns alleviated or exacerbated if the transmission provider were 
required to post the differential in costs between redispatched 
generators?
     Would the TDA proposal for the transmission provider to 
provide real-time redispatch using third party resources require the 
establishment of limited markets and, if so, what are the costs or 
benefits of doing so?

2. Conditional Firm Service

    In the NOPR, the Commission sought comment on whether a new 
conditional firm transmission service would provide a better means than 
redispatch for addressing circumstances in which insufficient transfer 
capacity exists to grant a long-term point-to-point request. Subsequent 
to the NOPR, the Commission held a technical conference on October 12, 
2006, that addressed, among other things, conditional firm service. In 
addition, Commission staff has held informal outreach sessions

[[Page 68496]]

with industry stakeholders on conditional firm service. During these 
discussions, certain additional issues regarding conditional firm 
service have arisen that merit further comment by the industry. The 
Commission invites comments on the following issues, to the extent 
supplemental comments add to the record rather than repeat arguments 
already made:
     Should conditional firm be offered as an alternative to 
redispatch or are they complementary services? For example, if 
redispatch is not available, should the transmission provider 
nevertheless be required to offer conditional firm service if 
available?
     Should conditional firm service be available for all long-
term requests (including those of 20-30 years) or should it be offered 
only as a ``bridge'' service where the customer agrees to pay for 
transmission system upgrades and conditional firm service is provided 
until those relevant upgrades are constructed? For example, for a 20-
year request for service, should the transmission provider be required 
to offer conditional firm service only during the first few years until 
relevant upgrades are constructed?
     Do limitations on system modeling present problems in 
offering conditional firm service over long periods (e.g., 10-30 
years)? For example, do standard modeling techniques make it easier to 
analyze system conditions in the near term (e.g., 1-5 years) than over 
the long term (e.g., 10-30 years)?
     If conditional firm service is considered as a ``bridge'' 
product, should special rules apply when the necessary upgrades are 
extremely expensive (e.g., 10 times the embedded cost rate)?
     If any necessary upgrades produce ``lumpy'' capacity 
(e.g., a request for 100 MW of point-to-point service results in 
upgrades that create 1,000 MW of additional flowgate capacity), how 
should the lumpy capacity be handled? Should the costs be assigned 
exclusively to the requesting customer or, alternatively, be shared 
with other customers? If costs are assigned to the requesting 
customers, should it obtain rights to the lumpy capacity that can be 
resold in the marketplace? Alternatively, could a ``bridging'' 
application of conditional firm service even out the ``lumpiness'' of 
the upgrade requirement by permitting deferral of the upgrade until 
load growth or new customers are prepared to absorb and help pay for 
the excess capacity from the upgrade and, if so, how could the 
transmission provider implement such a mechanism?
     In responding to a request for conditional firm service, 
should the transmission provider be required to provide customers with 
a choice between conditional curtailment based on specified system 
conditions and the maximum number of hours per year?
     Should conditional firm service qualify as a network 
resource when the associated resource is imported by a network customer 
on an adjacent system?
    Commenters are invited to file supplemental comments with the 
Commission on or before December 15, 2006. Commenters are invited to 
file joint supplemental comments in lieu of individually-filed 
comments. The Commission strongly discourages repetition of prior 
arguments.

    By direction of the Commission.
Magalie R. Salas,
Secretary.
[FR Doc. E6-19998 Filed 11-24-06; 8:45 am]
BILLING CODE 6717-01-P