[Federal Register Volume 75, Number 185 (Friday, September 24, 2010)]
[Rules and Regulations]
[Pages 58293-58303]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-23836]


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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

18 CFR Part 35

[Docket No. RM10-22-000; Order No. 739]


Promoting a Competitive Market for Capacity Reassignment

September 20, 2010.

AGENCY: Federal Energy Regulatory Commission.

ACTION: Final rule.

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SUMMARY: The Federal Energy Regulatory Commission lifts the price cap 
for all electric transmission customers reassigning transmission 
capacity based on the Commission's experience to date and a two-year 
study, released April 15, 2010. The removal of the price cap is 
intended to help facilitate the development of a market for electric 
transmission capacity reassignments as a competitive alternative to 
transmission capacity acquired directly from the transmission owner.

DATES: Effective Date: This rule will become effective September 24, 
2010.

FOR FURTHER INFORMATION CONTACT: 
Laurel Hyde (Technical Information), Office of Energy Market 
Regulation, Federal Energy Regulatory Commission, 888 First Street, 
NE., Washington, DC 20426, (202) 502-8146.
A. Cory Lankford (Legal Information), Office of the General Counsel, 
Federal Energy Regulatory Commission, 888 First Street, NE., 
Washington, DC 20426, (202) 502-6711.

SUPPLEMENTARY INFORMATION: 
Before Commissioners: Jon Wellinghoff, Chairman; Marc Spitzer, 
Philip D. Moeller, John R. Norris, and Cheryl A. LaFleur.

 
                                                              Paragraph
                                                                 Nos.
 
I. Background..............................................            2
II. Discussion.............................................           15
    A. Removal of the Price Cap............................           15
        1. Comments........................................           15
        2. Commission Determination........................           25
            a. Removal of the Price Cap....................           25
            b. Implementation of the Requirement...........           37
    B. Non-Rate Reforms to Promote Secondary Market........           39
        1. NOPR Proposal...................................           39
        2. Comments........................................           40
        3. Commission Determination........................           43
III. Information Collection Statement......................           44
IV. Environmental Analysis.................................           48
V. Regulatory Flexibility Act..............................           49
VI. Document Availability..................................           50
VII. Effective Date and Congressional Notification.........           53
 

    1. Based on the Commission's experience to date and a two-year 
study, released April 15, 2010,\1\ the Federal Energy Regulatory 
Commission in this Final Rule makes permanent the lifting of price caps 
for transmission customers reassigning electric transmission capacity. 
This action is intended to facilitate the development of a market for 
electric transmission capacity reassignments as a competitive 
alternative to primary transmission capacity.
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    \1\ FERC Staff, Staff Findings on Capacity Reassignment (2010), 
available at http://www.ferc.gov (Staff Report).
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I. Background

    2. In Order No. 888, the Commission concluded that a transmission 
provider's pro forma Open Access Transmission Tariff (OATT) must permit 
explicitly the voluntary reassignment of all or part of a holder's firm 
point-to-point capacity rights to any eligible customer.\2\ The 
Commission also found that allowing holders of firm transmission 
capacity rights to reassign that transmission capacity would help 
parties manage the financial risks associated with their long-term 
commitment, reduce the market power of transmission providers by 
enabling customers to compete, and foster efficient transmission 
capacity allocation.
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    \2\ Promoting Wholesale Competition Through Open Access Non-
Discriminatory Transmission Services by Public Utilities; Recovery 
of Stranded Costs by Public Utilities and Transmitting Utilities, 
Order No. 888, 61 FR 21540 (May 10, 1996), FERC Stats. & Regs. ] 
31,036, at 31,696 (1996), order on reh'g, Order No. 888-A, 62 FR 
12274 (March 14, 1997), FERC Stats. & Regs. ] 31,048 (1997), order 
on reh'g, Order No. 888-B, 81 FERC ] 61,248 (1997), order on reh'g, 
Order No. 888-C, 82 FERC ] 61,046 (1998), aff'd in relevant part sub 
nom. Transmission Access Policy Study Group v. FERC, 225 F.3d 667 
(DC Cir. 2000), aff'd sub nom. New York v. FERC, 535 U.S. 1 (2002).
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    3. With respect to the appropriate rate for transmission capacity 
reassignment, the Commission concluded it could not permit 
reassignments at market-based rates because it was unable to determine 
that the market for reassigned transmission capacity was sufficiently 
competitive so that resellers would not be able to exert market power. 
Instead, the Commission capped the rate at the highest of: (1) The 
original transmission rate charged to the purchaser (assignor); (2) the 
transmission provider's maximum stated firm transmission rate in effect 
at the time of the reassignment; or (3) the assignor's own opportunity 
costs capped at the cost of expansion (price cap). The Commission 
further explained that opportunity cost pricing had been permitted at 
``the higher of embedded costs or legitimate and verifiable opportunity 
costs, but not the sum of the two (i.e., `or' pricing is

[[Page 58294]]

permitted; `and' pricing is not).'' \3\ In Order No. 888-A, the 
Commission explained that opportunity costs for transmission capacity 
reassigned by a customer should be measured in a manner analogous to 
that used to measure the transmission provider's opportunity cost.\4\
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    \3\ Order No. 888, FERC Stats. & Regs. ] 31,036 at 31,740.
    \4\ Order No. 888-A, FERC Stats. & Regs. ] 31,048 at 30,224.
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    4. To foster the development of a more robust secondary market for 
transmission capacity, the Commission, in Order No. 890, concluded that 
it was appropriate to lift the price cap for all transmission customers 
reassigning transmission capacity.\5\ The Commission stated that this 
would allow transmission capacity to be allocated to those entities 
that value it most, thereby sending more accurate price signals to 
identify the appropriate location for construction of new transmission 
facilities to reduce congestion.\6\ The Commission also found that 
market forces, combined with the requirements of the pro forma OATT as 
modified in Order No. 890, would limit the ability of resellers, 
including affiliates of the transmission provider, to exert market 
power.
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    \5\ Preventing Undue Discrimination and Preference in 
Transmission Service, Order No. 890, 72 FR 12266 (March 15, 2007), 
FERC Stats. & Regs. ] 31,241, at P 808 (2007), order on reh'g, Order 
No. 890-A, 73 FR 2984 (January 16, 2008), FERC Stats. & Regs. ] 
31,261 (2007), order on reh'g, Order No. 890-B, 123 FERC ] 61,299 
(2008), order on reh'g, Order No. 890-C, 126 FERC ] 61,228 (2009), 
order on clarification, Order No. 890-D, 129 FERC ] 61,126 (2009).
    \6\ Order No. 890, FERC Stats. & Regs. ] 31,241 at P 808.
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    5. To enhance oversight and monitoring activities, the Commission 
adopted reforms to the underlying rules governing transmission capacity 
reassignments.\7\ First, the Commission required that all resales or 
reassignments of transmission capacity be conducted through or 
otherwise posted on the transmission provider's OASIS on or before the 
date the reassigned service commences.\8\ Second, the Commission 
required that assignees of transmission capacity execute a service 
agreement prior to the date on which the reassigned service 
commences.\9\ Third, in addition to existing OASIS posting 
requirements, the Commission required transmission providers to 
aggregate and summarize in an electric quarterly report the data 
contained in these service agreements.\10\
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    \7\ Id. P 815.
    \8\ Id.
    \9\ Id. P 816.
    \10\ Id. P 817.
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    6. The Commission also directed staff to closely monitor the 
reassignment-related data submitted by transmission providers in their 
quarterly reports to identify any problems in the development of the 
secondary market for transmission capacity and, in particular, the 
potential exercise of market power.\11\ Thus, the Commission directed 
staff to prepare, within six months of receipt of two years of 
quarterly reports, a report summarizing its findings.\12\ In addition, 
the Commission encouraged market participants to provide feedback 
regarding the development of the secondary electric transmission 
capacity market and, in particular, to contact the Commission's 
Enforcement Hotline if concerns arise.
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    \11\ Id. P 820.
    \12\ Id.
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    7. In Order No. 890-A, the Commission affirmed its decision to 
remove the price cap on reassignments of electric transmission capacity 
but granted rehearing to limit the period during which reassignments 
may occur above the cap.\13\ The period was limited so that the 
Commission could review the Staff Report to see if changes were needed 
based on the actual operation of the reassignment program. Accordingly, 
the Commission amended section 23.1 of the pro forma OATT to reinstate 
the price cap as of October 1, 2010.\14\
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    \13\ Order No. 890-A, FERC Stats. & Regs. ] 31,261 at P 388, 
390.
    \14\ Id. P 390.
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    8. The Commission also clarified that, as of the effective date of 
the reforms adopted in Order No. 890, all reassignments of electric 
transmission capacity must take place under the terms and conditions of 
the transmission provider's OATT. As a result, there was no longer a 
need for the assigning party to have on file with the Commission a rate 
schedule governing reassigned capacity. To the extent that a reseller 
has a market-based rate tariff on file, the provisions of that tariff, 
including a price cap or reporting obligations, will not apply to the 
reassignment since such transactions no longer take place pursuant to 
the authorization of that tariff.
    9. In Order No. 890-B, the Commission clarified that the pro forma 
OATT does not, and will not, permit the withholding of transmission 
capacity by the transmission provider and that it effectively 
establishes a price cap for long-term reassignments at the transmission 
provider's cost of expanding its system.\15\ The Commission further 
found that the fact that a transmission provider's affiliate may profit 
from congestion on the system does not relieve the transmission 
provider of its obligation to offer all available transmission capacity 
and expand its system as necessary to accommodate requests for 
service.\16\ The Commission pointed out that customers that do not wish 
to participate in the secondary market may continue to take service 
from the transmission provider directly, just as if the price cap had 
not been lifted.\17\
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    \15\ Order No. 890-B, 123 FERC ] 61,299 at P 78.
    \16\ Id.
    \17\ Id. P 79.
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    10. With regard to the Staff Report, the Commission clarified that 
staff should focus on the competitive effects of removing the price cap 
for reassigned electric transmission capacity.\18\ The Commission 
stated that staff should consider the number of reassignments occurring 
over the study period, the magnitude and variability of resale prices, 
the term of the reassignments, and any relationship between resale 
prices and price differentials in related energy markets. In addition, 
the Commission directed staff to examine the nature and scope of 
reassignments undertaken by the transmission provider's affiliates and 
include in its report any evidence of abuse in the secondary market for 
transmission capacity, whether by those affiliates or other customers.
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    \18\ Id. P 83.
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    11. The Commission also granted rehearing and directed each 
transmission provider to include in its electric quarterly report the 
identity of the reseller and indicate whether the reseller is 
affiliated with the transmission provider.\19\ The Commission also 
directed each transmission provider to include in its electric 
quarterly reports the rate that would have been charged under its OATT 
had the secondary customer purchased primary service from the 
transmission provider for the term of the reassignment.\20\ The 
Commission directed transmission providers to submit this additional 
data for all resales during the study period and to update, as 
necessary, any previously-filed electric quarterly reports on or before 
the date they submitted their next electric quarterly reports.
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    \19\ Id. P 84.
    \20\ Id.
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    12. On April 15, 2010, Commission staff published its report on the 
two-year study period.\21\ The Staff Report took a comprehensive look 
at electric point-to-point transmission capacity

[[Page 58295]]

reassignment that occurred over the period from the second quarter of 
2007 through the fourth quarter of 2009. Staff examined all reported 
electric transmission reassignments during this period on both a 
national and a regional basis. These almost 35,000 transactions 
encompassed 65 TWh of total volume transferred. Staff looked at the 
data in a number of ways, in order to better understand the market and 
to look for evidence of abuse. In doing so, staff looked at the 
magnitude and variability of resale prices, and focused on trends in 
those numbers over time and by region. Staff compared resale prices to 
the maximum tariff rates that would have otherwise been in effect for 
those transactions. Further, staff looked at reassignments by term--
hourly, daily, monthly, and yearly and looked at differences in term by 
transmission provider and by volume. Where the receipt and delivery 
points of transactions had reported price indices with sufficient data, 
staff compared the prices of reassignments to the energy market spread 
(differential in prices between the two locations) over the same time 
periods.
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    \21\ FERC Staff, Staff Finding on Capacity Reassignment (2010), 
available at http://www.ferc.gov (Staff Report).
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    13. Staff also compared resale prices for transactions involving 
affiliates versus non-affiliates. Staff compared the rate of 
transactions above the cap for both affiliates and non-affiliates. 
Staff looked for additional forms of affiliate abuse such as a 
transmission provider providing preferential treatment in the 
allocation of reassigned capacity to an affiliate. Staff also checked 
for complaints of the abuse in affiliate transactions, as well as for 
capacity reassignment in general.
    14. Two weeks after the release of the Staff Report, based on the 
Commission's experience in the natural gas transportation market and 
the Staff Report's conclusion that the secondary market had grown 
substantially and that resale prices reflected market fundamentals 
rather than the exercise of market power, the Commission issued a 
Notice of Proposed Rulemaking (NOPR) proposing to lift the price cap 
for all electric transmission customers reassigning transmission 
capacity beyond October 1, 2010. In addition, the Commission proposed 
to direct transmission providers to submit corresponding revisions to 
their OATTs within 30 days of publication of the Final Rule in the 
Federal Register. The Commission also sought comment as to whether 
there are any other reforms that it should undertake to create a more 
efficient and vibrant secondary market for electric transmission 
capacity. In response to these NOPR proposals, the Commission received 
comments from 13 parties, which are addressed below.\22\
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    \22\ A list of commenters is provided in Appendix A.
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II. Discussion

A. Removal of the Price Cap

1. Comments
    15. Several commenters support the Commission's proposal to remove 
the price cap on transmission reassignments permanently.\23\ They 
contend that removal of the cap will encourage the development of a 
more robust secondary market, resulting in appropriate price signals 
and an efficient allocation of transmission capacity. Cargill comments 
that the resale of transmission capacity at negotiated rates is 
consistent with other Commission reforms in favor of market-based 
pricing.
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    \23\ E.g. Bonneville, Cargill, EPSA, FIEG, PG&E, PGE, Powerex, 
Seattle.
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    16. Despite their general support for the Commission's proposal, 
EPSA and PG&E raise concerns about the staff study and the need for 
transparency. EPSA states that the Staff Report shows some gaps that 
will require further analysis; such as limited numbers of transmission 
providers reported and the majority of transactions being from 
Bonneville. PG&E expresses a lingering concern about the potential for 
transmission service providers to raise power prices in locations where 
there is insufficient competition. EPSA and PG&E urge the Commission to 
continue to monitor the capacity reassignment market as it matures so 
that the Commission will be informed and therefore able to direct 
necessary reforms to the market, as the needed reforms reveal 
themselves. EPSA further urges the Commission to look at ways of 
increasing transparency for transmission capacity available for 
reassignments as a way of promoting the secondary market for 
reassignment. Powerex comments that there are already a number of 
safeguards including requirements that transmission providers report 
reassignments on their systems on OASIS and in the electronic quarterly 
reports (EQR) that should help limit abuses. Similarly, Seattle 
comments that reconciliation of EQRs, audits, and OASIS transactions 
would go a long way to ensure that resale markets are functioning 
without affiliate abuse.
    17. Bonneville agrees that lifting the price cap on transmission 
capacity reassignments appears to support the goal of a more robust 
secondary market for that capacity but asks the Commission to recognize 
the position of non-jurisdictional entities, such as itself. Bonneville 
contends that non-jurisdictional entities may have to place conditions 
upon the removal of the cap in order to obtain reciprocity and comply 
with their applicable statutory requirements. Bonneville contends that 
if its administrator determines that behavior associated with 
transmission capacity reassignments is occurring on its system in a 
manner that frustrates or is otherwise inconsistent with the 
administrator's statutory requirements to make all excess capacity 
available to utilities on a fair and nondiscriminatory basis, the 
administrator must be able to act promptly to stop that behavior. Thus, 
Bonneville suggests that any revision to section 23 of Bonneville's 
OATT permanently lifting the price cap must be conditioned upon the 
administrator's express authority to carry out this mandate including 
the right to reinstate the cap expeditiously if necessary.
    18. Other commenters argue against removal of the price cap, 
contending that staff's two-year study provides insufficient evidence 
to support a finding that the secondary market is sufficiently 
competitive to lift the price caps or that market forces or other 
factors will be effective to adequately protect consumers.\24\ These 
commenters point out that, although the Final Rule would apply to an 
estimated 132 public utilities, the Staff Report included data from 
only 26 with 79 percent of the reported transactions coming from 
Bonneville. These commenters also point out that the study was 
performed during a recession with concomitant reductions in the demand 
for electricity, and that Bonneville is atypical, given that it is 
dependent on large hydroelectric projects. APPA further comments that 
because there were so few sales made during the study period by 
affiliates above the rate cap, it would appear that reinstitution of 
the cap would not significantly dampen resales of capacity by 
affiliates of transmission providers.
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    \24\ E.g. APPA, NRECA, SCE, TAPS, Outland, and TDU Systems.
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    19. TAPS states that the staff study did not examine both prices 
offered and accepted such that the Commission could determine the level 
of market interest in reassigned capacity, whether prices increased, 
the cause of price changes, and whether those prices remained in the 
zone of reasonableness. It notes that the staff study compared resale 
prices during the study period to the tariff rate, but not to the 
opportunity cost cap, which is likely higher. It argues that 
accordingly, the study does not show that the price cap constrained

[[Page 58296]]

any prices, and thus it prevents a finding that the price cap is unjust 
and unreasonable. SCE requests that the Commission reconcile its 
proposal with findings in the Staff Report that removal of the price 
cap does not appear to be primarily responsible for the observed growth 
in the secondary market. It also states that the Staff Report did not 
definitively conclude that there was not abuse by resellers, even in a 
period with very low demand and no supply scarcity. SCE states that 
this is not sufficient evidence to lift the price cap. APPA, SCE and 
TAPS suggest that, if the Commission wishes to lift the price cap, it 
should only do so as a continuation of the experiment.
    20. NRECA, TAPS, and TDU Systems argue that the Staff Report does 
not provide a sufficient factual basis for the Commission to conclude 
that the OATT section 23.1, which reinstates the price cap on October 
1, 2010, is unjust and unreasonable or to conclude that proposed 
revision is just and reasonable. Moreover, TAPS and TDU Systems comment 
that market-based reassignment of transmission capacity should not be 
available to entities to the extent they lack market-based rate 
authority in the area in which the transmission reservation is located. 
TDU Systems states that each secondary transmission capacity market 
should be looked at individually, and that there is no single, national 
market for secondary transmission capacity rights. It questions why the 
Staff Report considers Public Service of New Hampshire (PSNH) to be an 
aberration, while the nearby Central Vermont Public Service Corporation 
(Central Vermont) system is presented as representing national trends.
    21. TAPS and TDU Systems further contend that, to permit market-
based rates, the Commission remains bound by the requirement that 
market-based rates be supported by empirical proof that existing 
competition would ensure that the actual price is just and 
reasonable.\25\ TDU Systems comments that courts have held that 
undocumented reliance on market forces is insufficient grounds for 
authorizing market-based rates.\26\ Moreover, TAPS and TDU Systems 
argue that the Commission has a requirement to make an ex ante finding 
of the absence of market power and sufficient post-approval 
requirements.\27\ SCE agrees that the Commission should engage in an ex 
ante competitive analysis to find that the transmission reseller lacks 
market power, or take sufficient steps to mitigate market power, as 
well as adopt sufficient post-approval reporting requirements.
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    \25\ Citing Farmers Union Cent. Exch., Inc. v. FERC, 734 F.2d 
1486, 1510 (DC Cir. 1984)(Farmers Union).
    \26\ Citing Transwestern Pipeline, 43 FERC ] 61,240, at 61,250 
(1988).
    \27\ Citing California ex. Rel. Lockyer v. FERC, 383 F.3d 1006, 
1013 (9th Cir. 2004).
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    22. Outland states that the pilot project has allowed resellers to 
acquire capacity ``for pennies and then hold up the first renewable 
energy generator that comes along looking to use it.'' \28\ It states 
that parties acquire transmission when they do not need it for a real 
generation project, to the detriment of real projects.
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    \28\ Outland at 1.
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    23. NRECA, TAPS, and TDU Systems urge the Commission, at a minimum, 
to retain the price cap on transmission capacity reassignments for 
transmission provider affiliates and retail/merchant functions. TAPS 
states that the pattern of affiliate pricing reveals more about 
corporate strategy selected by a few corporate entities and general 
conditions during an atypical period, than confirming the Commission's 
assumption that the rates for primary capacity or competition in the 
reassignment market will restrain prices. It states that assuming that 
the customer may always take service from the transmission provider 
directly is cold comfort if the available capacity has been assigned to 
the transmission provider's affiliate. NRECA states that a larger 
portion of affiliate than non-affiliate transactions occurred over the 
cap, and points to the PSNH system where all reported transactions 
originated with an affiliate and occurred over the price cap.
    24. In its supplemental comments, Powerex expresses concern that 
Bonneville might reinstate the price cap as of October 1, 2010, 
regardless of Commission action in this proceeding. Powerex asks the 
Commission to address the possible adverse consequences of non-
jurisdictional transmission providers reinstating price caps on 
transmission reassignments and to provide guidance to customers seeking 
to reassign transmission on the systems of non-jurisdictional 
transmission providers that elect not to adopt any reforms the 
Commission directs. To address this issue, Powerex requests the 
Commission to clarify that its seller-specific market-based rate 
schedule for transmission reassignment remains operative. 
Alternatively, Powerex seeks guidance on how to price capacity 
reassignments based on the customer's opportunity cost capped at the 
transmission provider's cost of expansion.
2. Commission Determination
a. Removal of the Price Cap
    25. The Commission hereby adopts its NOPR proposal to lift the 
price cap for all reassignments of electric transmission capacity to 
become effective October 1, 2010. Removal of the price cap will help 
foster the development of a more robust secondary market for 
transmission capacity because point-to-point transmission service 
customers will have increased incentives to resell their service 
whenever others place a higher value on it. Existing transmission, 
therefore, may be put to better, more efficient use.
    26. Moreover, removal of the price cap will promote the efficient 
construction of new capacity. Prices serve as signals indicating where 
capacity shortages exist and where potentially profitable construction 
can take place. The Commission has previously addressed the need for 
new transmission and established incentives for its construction.\29\ 
Removing the price cap on sales of secondary electric transmission 
capacity is one way to create the proper incentives for new 
transmission investment in this industry. Areas with congestion tend to 
have higher prices and thus signal the need for investment.\30\ 
However, if prices for reassigned capacity exceed the cost of 
construction of new transmission, the customer could request service 
from the transmission provider which would support investment in new 
transmission and lower costs prospectively by relieving constrained 
transmission capacity. Thus, the price of reassigned capacity will 
remain effectively capped at the cost of new transmission. We therefore 
reaffirm the Commission's finding in Order No. 890-A that removal of 
the price cap for reassigned capacity will help establish a competitive 
market for secondary transmission capacity that will send more accurate 
signals and that such price signals will promote more efficient use of 
the electric transmission system.\31\
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    \29\ Promoting Transmission Investment through Pricing Reform, 
Order No. 679, 71 FR 43294 (July 31, 2006), FERC Stats. & Regs. ] 
31,222 (2006), order on reh'g, Order No. 679-A, 72 FR 1152 (January 
10, 2007), FERC Stats. & Regs. ] 31,236 (2006), order on reh'g, 119 
FERC ] 61,062 (2007).
    \30\ See Interstate Nat'l Gas Ass'n of America v. FERC, 285 F.3d 
18, 32-34 (DC Cir. 2002) (INGAA) (``[B]rief spikes in moments of 
extreme exigency are completely consistent with competition, 
reflecting scarcity rather than monopoly.'').
    \31\ Order No. 890-A, FERC Stats. & Regs. ] 31,261 at P 388.
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    27. Our continued regulatory oversight will also limit the 
potential for the exercise of market power. We are

[[Page 58297]]

not deregulating or otherwise adopting market-based rates for the 
provision of transmission service under the pro forma OATT. 
Transmission providers will continue to be obligated to offer available 
transfer capability to customers, including available transfer 
capability associated with purchased but unused capacity. Transmission 
providers also will continue to be obligated to construct new 
facilities to satisfy requests for service if those requests cannot be 
satisfied using existing capacity. Furthermore, the rates for 
transmission service provided under the pro forma OATT will continue to 
be determined on a cost-of-service basis unless the transmission 
provider can demonstrate, on a case-specific basis, that it lacks 
market power. Nothing in this Final Rule affects the obligations of 
transmission providers to offer service under the pro forma OATT at 
cost-based rates. The availability of firm and non-firm service from 
transmission providers, therefore, will limit the ability of 
reassignors to exercise market power. In INGAA, the Court of Appeals 
for the District of Columbia Circuit recognized that the maintenance of 
regulated rates for primary service would protect against the potential 
for the exercise of market power in the capacity release market.\32\
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    \32\ 285 F.3d at 32 (``[i]f holders of firm capacity do not use 
or sell all of their entitlement, the pipelines are required to sell 
the idle capacity as interruptible service to any taker at no more 
than the maximum rate--which is still applicable to the 
pipelines''); see also, Promotion of a More Efficient Capacity 
Release Market, Order No. 712, 73 FR 37058 (June 30, 2008), FERC 
Stats. & Regs. ] 31,271, at P48-49 (2008), order on reh'g, Order No. 
712-A, FERC Stats. & Regs. ] 31,284 (2008).
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    28. The Commission disagrees with suggestions that affiliates of 
the transmission provider be treated differently than non-affiliated 
customers with respect to reassignments of transmission capacity. The 
Commission's Standards of Conduct are designed to prevent the 
transmission provider and its affiliate from acting in concert to 
exercise market power.\33\ Commenters did not identify any affiliate 
concerns that these obligations, along with the monitoring discussed 
below, would not address.
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    \33\ See Standards of Conduct for Transmission Providers, Order 
No. 717, 73 FR 63796 (October 27, 2008), FERC Stats. & Regs. ] 
31,280 (2008), order on reh'g, Order No. 717-A, 74 FR 54463 (October 
22, 2009), FERC Stats. & Regs. ] 31,297 (2009), order on reh'g, 
Order No. 717-B, 129 FERC ] 61,123 (2009), order on reh'g, Order No. 
717-C, 131 FERC ] 61,045 (2010). The Commission's Standards of 
Conduct establish that a transmission provider must (1) treat all 
customers, affiliated and non-affiliated, on a not unduly 
discriminatory basis, (2) not make or grant any undue preference or 
advantage to any person, and (3) not subject any person to any undue 
prejudice or disadvantage with respect to transmission of electric 
energy. This would include avoiding undue prejudice or disadvantage 
in the initial allocation of capacity to affiliates, thereby 
allowing those affiliates to gain market power and then to exercise 
it when reassigning capacity.
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    29. The Commission takes seriously the possibility that resellers 
may attempt to exercise market power in the secondary market for 
transmission. We continue to find, however, that the regulatory 
protections in place and our increased oversight of this market will 
limit the potential for market power abuse. Prices for secondary 
transmission capacity may rise above prices for primary transmission 
capacity but this alone does not indicate an abuse of market power. On 
the contrary, courts have recognized that prices in a competitive 
market should rise during periods when capacity is truly scarce in 
order to ensure that transmission capacity is being allocated 
appropriately.\34\ Nevertheless, the Commission will continue to 
monitor the secondary transmission capacity market to ensure that 
participants are not exercising market power.\35\ The Commission also 
will monitor for abuse by transmission providers in concert with their 
affiliates. If a customer has evidence of an exercise of market power 
or other abuse, it should bring the matter to the Commission's 
attention through a complaint or other appropriate procedural 
mechanism. Absent such evidence, the Commission concludes that the 
continued rate regulation of the primary market for electric 
transmission capacity and the transmission provider's obligation to 
expand its system to accommodate service requests adequately mitigates 
any market power that resellers may have in the long-term secondary 
market.
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    \34\ INGAA, 285 F.3d at 32-34 (``[B]rief spikes in moments of 
extreme exigency are completely consistent with competition, 
reflecting scarcity rather than monopoly.'').
    \35\ See Order No. 890, FERC Stats. & Regs. ] 31,241 at P 815.
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    30. The Staff Report did not raise any concerns with removal of the 
price cap that would warrant its reimposition given the regulatory 
protections and increased market oversight discussed above. The report 
included a comprehensive examination of the assignments that took place 
during the study period which included both the period prior to the 
economic downturn starting in September 2008 and the period after the 
downturn. Although the Staff Report did not conclusively demonstrate 
that the price cap inhibited the growth of the secondary market, the 
data showed a marked growth in reassignments, with both the number of 
transactions and the volume increasing during the two and one half year 
time span. The number of reassignments grew from just over 200 in 2007 
to almost 32,000 in 2009. During this same period, the volume 
reassigned grew from 3 TWh to 36 TWh.
    31. The data do not suggest the exercise of market power. The 
prices during the test period appear consistent with pricing 
differentials between locational markets, indicating that the 
transactions reflect market fundamentals, not the exercise of market 
power.\36\ Moreover, the Staff Report found that 99 percent of 
reassignments were priced at or below the transmission provider's 
maximum firm transmission rate, an indication that prices reflect 
market conditions and competition rather than the exercise of market 
power.\37\ The brief spikes above the price cap are consistent with a 
competitive market, indicating scarcity rather than market power.\38\
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    \36\ See INGAA, 285 F.3d at 31 (indicating that differentials in 
prices between receipt and delivery points are indicative of the 
value of the transportation between those points).
    \37\ Because 99 percent of the prices were below the tariff 
rate, these prices are almost certainly lower than opportunity costs 
which TAPS suggests are likely higher than the tariff rate.
    \38\ INGAA, 285 F.3d 18, 32 (``A surge in the price of candles 
during a power outage is no evidence of monopoly in the candle 
market'').
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    32. We disagree with comments suggesting that the Staff Report does 
not provide enough evidence to support a finding that the market is 
sufficiently competitive to lift the price cap because it relied on 
data from a limited number of transmission providers. While capacity 
reassignments occurred on a limited number of transmission systems, the 
lack of data for other transmission providers indicates a lack of 
reassignments on those systems, not an exercise of market power or lack 
of potential competition for capacity reassignment. Where reassignment 
is currently non-existent or occurring at a lower level, potential 
reassignment of transmission in these areas, should it develop, would 
face competition associated with transmission that can be acquired from 
other customers. Such reassignment also would compete with capacity 
available from the transmission provider. Although the data in the 
Staff Report included extensive data from Bonneville and Central 
Vermont, the greater number of such assignments may be due to 
differences in market dynamics (such as the extensive use of 
hydroelectric power in the Bonneville region) or reporting conventions 
(in the case of Central Vermont).\39\ It also may

[[Page 58298]]

indicate that capacity reassignment is more developed in those areas. 
The volume of capacity reassignments on these two systems provides an 
example of what may be possible in other areas of the country. As for 
arguments that the time period under review was atypical due to the 
economic downturn and, thus, not representative, we note that study 
began the second quarter of 2007, well before the downturn began.
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    \39\ The Staff Report states that ``the large number of [Central 
Vermont] transactions may be due, in part, to reporting conventions. 
For EQR reporting purposes, each line of data is counted as one 
transaction.'' See Staff Report at 4.
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    33. The Staff Report also did not show evidence of affiliate abuse. 
Ninety-nine percent of reassignments by affiliates of the transmission 
provider were at or below the transmission provider's maximum rate. The 
percentage of such reassignments over the maximum firm transmission 
rate by affiliates was comparable to that by non-affiliates (0.5 
percent versus 0.4 percent).
    34. While it is true, as some of the commenters point out, that the 
reassignment transactions were limited to certain areas and utilities, 
we see no reason to expect different results as capacity reassignment 
expands. There have not been allegations of the exercise of market 
power in reassignment markets, and commenters do not provide any data 
to suggest that market power may be more prevalent as capacity 
reassignment increases on other transmission systems. Development of a 
more robust reassignment market in areas where reassignments are not 
prevalent should raise, rather than lower, the level of competition in 
markets. Moreover, we will continue to monitor the market and if 
anomalies develop in certain areas, they can be addressed.
    35. We disagree with the comments that a market power study or 
other empirical competition analyses are required to lift the price cap 
on transmission capacity reassignments. Contrary to commenters' 
assertions, market power analyses are not the only method to ensure 
that market-based rates remain just and reasonable.\40\ In INGAA,\41\ 
the DC Circuit affirmed the Commission's removal of price ceilings for 
short-term capacity releases by shippers in the natural gas market 
without requiring sellers to submit market power analyses. The court 
recognized that non-cost factors such as the need to facilitate 
movement of capacity into the hands of those who value it most may also 
justify the removal of price ceilings. The court concluded that these 
non-cost factors, combined with the limitation of negotiated rates to 
the secondary market, distinguished the case from Farmers Union in 
which the court had reversed a Commission determination to implement 
lighthanded regulation of the oil industry.\42\
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    \40\ See Alternatives to Traditional Cost-of-Service Ratemaking 
for Natural Gas Pipelines and Regulation of Negotiated 
Transportation Services of Natural Gas Pipelines, 74 FERC ] 61,076, 
at 61,227-36 (1996). The Commission ultimately determined in that 
case that a market power analysis was required in order to allow a 
pipeline to use market-based pricing instead of cost-of-service 
rates. The Commission has not proposed to allow transmission 
providers to engage in sales of primary capacity at market-based 
rates and, as explained below, sufficient protections exist to 
ensure the secondary market for transmission capacity remains 
sufficiently competitive without requiring market power analyses 
from each reseller.
    \41\ Interstate Nat'l Gas Ass'n of American v. FERC, 285 F.3d at 
33 (DC Cir. 2002).
    \42\ Interstate Nat'l Gas Ass'n of America v. FERC, 285 F.3d 18 
at 31-34 (DC Cir. 2002), order on remand, 101 FERC ] 61,127 (2002), 
order on reh'g, 106 FERC ] 61,088 (2004), aff'd sub nom. American 
Gas Ass'n v. FERC, 428 F.3d 255 (DC Cir. 2005).
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    36. Farmers Union itself did not require a market power study to 
support a move to a more market-based regulatory regime. The court 
found that rates should be within a ``zone of reasonableness, where 
[they] are neither less than compensatory nor excessive.'' \43\ 
Moreover, the court found that the Commission could justify a move to a 
more market-based focus ``by a showing that under circumstances the 
goals and purposes of [the Commission's statutory mandate] will be 
accomplished through substantially less regulatory oversight.'' \44\ 
Here, the Commission is relying on competition in the market for 
transmission capacity, together with the regulatory protections 
discussed above, to ensure just and reasonable rates. Protections, such 
as continuing rate regulation of the transmission provider's primary 
capacity, retention of the requirement for transmission owners to build 
additional capacity at cost-based rates, competition among resellers, 
reforms to the secondary market for transmission capacity, and 
reporting requirements combined with enforcement proceedings, audits, 
and other regulatory controls, will assure that prices in the secondary 
market for electric transmission capacity remain within a zone of 
reasonableness.\45\
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    \43\ Farmers Union, 734 F.2d at 1502; see also, INGAA, 285 F.3d 
at 31.
    \44\ Farmers Union, 734 F.2d at 1510.
    \45\ See Order No. 890, FERC Stats. & Regs. ] 31,241 at P 811; 
see also Order No. 712, 73 FR 37058 (June 30, 2008), FERC Stats. & 
Regs. ] 31,271 at P 39 (2008), order on reh'g, Order No. 712-A, FERC 
Stats. & Regs. ] 31,284 (2008), aff'd sub nom. Interstate Natural 
Gas Ass'n of America, No. 09-1016 (DC Cir. Aug. 13, 2010).
---------------------------------------------------------------------------

b. Implementation of the Requirement
    37. Because the current OATTs reinstate the price cap as of October 
1, 2010, transmission providers will need to revise section 23 of the 
pro forma OATT, as indicated in Appendix B. We direct transmission 
providers to file these changes within 30 days from publication of this 
Final Rule in the Federal Register. Bonneville requests a blanket 
waiver of the requirement for non-jurisdictional entities that are 
unable to satisfy reciprocity conditions with regard to the 
reassignment of transmission capacity. Whether the particular terms and 
conditions of a non-jurisdictional transmission provider's reciprocity 
tariff satisfy the Commission's open access principles must be 
determined on a case-by-case basis. Therefore, the Commission denies, 
without prejudice, Bonneville's request for a blanket waiver.
    38. We find Powerex's concern that Bonneville will reinstate the 
price cap as of October 1, 2010 to be premature, since Bonneville has 
not made a final decision at this point. Moreover, when Bonneville 
submitted its tariff revisions pursuant to Order No. 890, it declined 
to adopt certain pro forma provisions related to the reassignment of 
transmission capacity and several transmission customers within 
Bonneville, including Powerex, filed stand-alone rate schedules 
allowing them to sell transmission capacity above the price cap.\46\ 
These customers may submit any necessary revisions to their rate 
schedules before October 1, 2010 and request waiver of the prior notice 
requirement, if they find such action to be necessary and appropriate.
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    \46\ See Portland General Electric Co., Docket No. ER09-93-000 
(Dec. 3, 2008) (unpublished letter order); Idaho Power Co., Docket 
No. ER09-524-000 (Mar. 5, 2009) (unpublished letter order); Puget 
Sound Energy, Inc., Docket No. ER09-528-000 (Mar. 5, 2009) 
(unpublished letter order); Avista Corp., ER09-729-000 (May 12, 
2009) (unpublished letter order); PacifiCorp, Docket No. ER09-921-
001 (Sept. 29, 2009) (unpublished letter order); Powerex Corp., 
Docket No. ER09-926-000 (May 21, 2009) (unpublished letter order).
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B. Non-Rate Reforms To Promote Secondary Market

1. NOPR Proposal
    39. In the NOPR, the Commission sought comment as to whether there 
are any reforms, other than removal of the price cap, that it should 
undertake to create a more efficient and vibrant secondary market for 
transmission capacity. The Commission asked if there are non-price 
limitations or regional factors that may be continuing to limit the 
utility of reassignment. By way of an example, the Commission asked if 
there

[[Page 58299]]

are reforms to the redirect process that would enable all firm 
customers to use their firm capacity more flexibly and thereby 
facilitate capacity reassignment by making point changes by the buyer 
of reassigned capacity more efficient.
2. Comments
    40. Although FIEG supports the Commission's proposal to allow 
redirects of reassigned capacity, several other commenters raise 
concerns. Powerex admits that the ability to modify receipt and 
delivery points of reassigned capacity may make the capacity more 
attractive to a potential third-party assignee but warns that this 
practice would erode the priority that firm capacity should be 
accorded. NRECA expresses similar concern that this proposal may give 
higher priority to point-to-point customers who wish to redirect by 
awarding them service over those non-firm customers who do not redirect 
and over secondary network customers. APPA contends that any reforms to 
firm point-to-point service proposed to increase the attractiveness of 
re-sales of firm point-to-point capacity would have to be carefully 
assessed to ensure that they do not result in a degradation of the 
quality of network integration transmission service. TAPS and TDU 
Systems urge the Commission to not use a narrowly focused rulemaking to 
implement a sweeping change to point-to-point transmission service.
    41. Commenters offered suggestions about various other reforms as 
well. Bonneville and Seattle argue that requiring transmission 
providers to act as financial intermediaries in capacity reassignments 
imposes an undue burden and complicates settlements. Powerex and 
Bonneville raise concerns about transmission providers failing to 
recalculate available transfer capability or available flowgate 
capability in a timely manner, thereby inhibiting reassignments. 
Bonneville recommends that a firm redirect request receive a credit for 
any available flowgate capability the parent reservation has on the 
flowgates impacted by the firm redirect request. TAPS suggests that the 
Commission require the posting of transmission capacity available for 
reassignment on the transmission provider's OASIS. Cargill recommends 
that the reseller not remain responsible or liable to the transmission 
provider for the reassigned capacity if it is a complete reassignment 
(the full quantity of capacity for the remainder of the reservation) or 
if the reseller performs a long-term assignment of the reservation for 
any quantity up to the full amount of the capacity of the reservation.
    42. Seattle advocates a transition from comma separated data to 
structured XML data in order to enhance data exchange and validation 
between ``front-end'' and ``back-end systems'' used by transmission 
customers and providers. It also advocates more meaningful forms of 
transaction umbrella agreements, such as the WSPP agreement. EPSA 
advocates consistent rules about posting the entities and market 
participants that have active umbrella agreements with the transmission 
provider. It says that such postings would give competitive suppliers 
transparency about which market participants can purchase reassigned 
capacity.
3. Commission Determination
    43. The Commission declines to implement the non-rate reforms 
proposed in this proceeding at this time. Although some of these 
proposals may have merit, we are unable to make a determination that 
they are appropriate at this time based on the record in this 
proceeding. With respect to the issues raised by Seattle and EPSA 
regarding data structures, such issues are best addressed through the 
standards development process of the North American Energy Standards 
Board, which sets voluntary wholesale electric market standards 
including those related to data exchanges and posting requirements.

III. Information Collection Statement

    44. The following collection of information contained in this 
proposed rule is subject to review by the Office of Management and 
Budget (OMB) under section 3507(d) of the Paperwork Reduction Act of 
1995.\47\ OMB's regulations require OMB to approve certain information 
collection requirements imposed by agency rule.\48\
---------------------------------------------------------------------------

    \47\ 44 U.S.C. 3507(d) (2006).
    \48\ 5 CFR 1320.11 (2010).
---------------------------------------------------------------------------

    Burden Estimate: The public reporting and records retention burdens 
for the reporting requirements and the records retention requirement 
are as follows.\49\ The Commission solicited comments on the need for 
this information and did not receive any specific comments regarding 
its burden estimates. Where commenters raised concerns that specific 
information collection requirements would be burdensome to implement, 
the Commission has addressed those concerns elsewhere in the rule.
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    \49\ These burden estimates apply only to this Final Rule and do 
not reflect upon all of FERC-516 or FERC-717.

----------------------------------------------------------------------------------------------------------------
                                                 Number of        Number of        Hours per       Total annual
               Data collection                  respondents       responses         response          hours
----------------------------------------------------------------------------------------------------------------
Conforming tariff changes...................             132                1               10            1,320
----------------------------------------------------------------------------------------------------------------

    Cost To Comply: $150,480

1,320 hours @ $114 an hour (average cost of attorney ($200 per hour), 
consultant ($150), technical ($80), and administrative support ($25))

    OMB's regulations require it to approve certain information 
collection requirements imposed by an agency rule. The Commission is 
submitting a copy of this Final Rule to OMB for their review approval 
of the information collection requirements.
    Title: FERC-516, Electric Rate Schedules and Tariff Filings; FERC-
717 Standards for Business Practices and Communication Protocols for 
Public Utilities.
    Action: Collection
    OMB Control Nos. 1902-0096 and 1902-0173
    Respondents: Transmission Providers
    Frequency of responses: One time.
    Necessity of the Information:
    45. The Federal Energy Regulatory Commission is adopting amendments 
to the pro forma OATT to ensure that transmission services are provided 
on a basis that is just, reasonable and not unduly discriminatory or 
preferential. The purpose of this rulemaking is to strengthen the pro 
forma OATT by encouraging more robust competition. The Final Rule 
achieves this goal by removing the price cap previously imposed on 
reassignments of transmission capacity.
    46. Interested persons may obtain information on the reporting 
requirements by contacting the following: Federal Energy Regulatory 
Commission, 888 First Street, NE., Washington, DC 20426, [Attention: 
Michael Miller, Office of the Executive

[[Page 58300]]

Director, Phone: (202) 502-8415, fax: (202) 273-0873, e-mail: 
[email protected].]
    47. For submitting comments concerning the collections of 
information and the associated burden estimate(s), please send your 
comments to the contact listed above and to the Office of Information 
and Regulatory Affairs, Office of Management and Budget, 725 17th 
Street, NW., Washington, DC 20503 [Attention: Desk Officer for the 
Federal Energy Regulatory Commission, phone: (202) 395-4638, fax: (202) 
395-7285. Due to security concerns, comments should be sent 
electronically to the following e-mail address: [email protected]. Please reference the docket number of this 
rulemaking in your submission.

IV. Environmental Analysis

    48. The Commission is required to prepare an Environmental 
Assessment or an Environmental Impact Statement for any action that may 
have a significant adverse effect on the human environment.\50\ The 
Commission concludes that neither an Environmental Assessment nor an 
Environmental Impact Statement is required for this Final Rule under 
section 380.4(a)(15) of the Commission's regulations, which provides a 
categorical exemption for approval of actions under sections 205 and 
206 of the Federal Power Act (FPA) relating to the filing of schedules 
containing all rates and charges for the transmission or sale subject 
to the Commission's jurisdiction, plus the classification, practices, 
contracts and regulations that affect rates, charges, classifications 
and services.\51\
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    \50\ Regulations Implementing the National Environmental Policy 
Act, Order No. 486, 52 FR 47897 (December 17, 1987), FERC Stats. & 
Regs., Regulations Preambles 1986-1990 ] 30,783 (1987).
    \51\ 18 CFR 380.4(a)(15) (2010).
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V. Regulatory Flexibility Act

    49. The Regulatory Flexibility Act of 1980 (RFA) \52\ generally 
requires a description and analysis of Final Rules that will have 
significant economic impact on a substantial number of small entities. 
This Final Rule applies to public utilities that own, control, or 
operate interstate transmission facilities, not to electric utilities 
per se. The total number of public utilities that, absent waiver, would 
have to modify their current OATTs by filing the revised pro forma OATT 
is 176.\53\ Of these only six public utilities, or less than two 
percent, dispose of four million MWh or less per year.\54\ The 
Commission does not consider this a substantial number, and in any 
event, these small entities may seek waiver of these requirements.\55\ 
Moreover, the criteria for waiver that would be applied under this 
rulemaking for small entities is unchanged from that used to evaluate 
requests for waiver under Order Nos. 888 and 889. Thus, small entities 
who have received waiver of the requirements to have on file an open 
access tariff or to operate an OASIS would be unaffected by the 
requirements of this proposed rulemaking.
---------------------------------------------------------------------------

    \52\ 5 U.S.C. 601-612 (2006).
    \53\ The sources for this figure are FERC Form No. 1 and FERC 
Form No. 1-F data.
    \54\ Id.
    \55\ The Regulatory Flexibility Act defines a ``small entity'' 
as ``one which is independently owned and operated and which is not 
dominant in its field of operation.'' See 5 U.S.C. 601(3) and 
601(6)(2000); 15 U.S.C. 632(a)(1) (2000). In Mid-Tex Elec. Coop. v. 
FERC, 773 F.2d 327, 340-343 (DC Cir. 1985), the court accepted the 
Commission's conclusion that, since virtually all of the public 
utilities that it regulates do not fall within the meaning of the 
term ``small entities'' as defined in the Regulatory Flexibility 
Act, the Commission did not need to prepare a regulatory flexibility 
analysis in connection with its proposed rule governing the 
allocation of costs for construction work in progress (CWIP). The 
CWIP rules applied to all public utilities. The revised pro forma 
OATT will apply only to those public utilities that own, control or 
operate interstate transmission facilities. These entities are a 
subset of the group of public utilities found not to require 
preparation of a regulatory flexibility analysis for the CWIP rule.
---------------------------------------------------------------------------

VI. Document Availability

    50. In addition to publishing the full text of this document in the 
Federal Register, the Commission provides all interested persons an 
opportunity to view and/or print the contents of this document via the 
Internet through FERC's Home Page (http://www.ferc.gov) and in FERC's 
Public Reference Room during normal business hours (8:30 a.m. to 5 p.m. 
Eastern time) at 888 First Street, NE., Room 2A, Washington DC 20426.
    51. From FERC's Home Page on the Internet, this information is 
available on eLibrary. The full text of this document is available on 
eLibrary in PDF and Microsoft Word format for viewing, printing, and/or 
downloading. To access this document in eLibrary, type the docket 
number excluding the last three digits of this document in the docket 
number field.
    52. User assistance is available for eLibrary and the FERC's Web 
site during normal business hours from FERC Online Support at (202) 
502-6652 (toll free at 1-866-208-3676) or e-mail at 
[email protected], or the Public Reference Room at (202) 502-
8371, TTY (202) 502-8659. E-mail the Public Reference Room at 
[email protected].

VII. Effective Date and Congressional Notification

    53. These regulations shall become effective September 24, 2010. 
Section 553(d) of the Administrative Procedure Act (APA) generally 
requires a rule to be effective not less than 30 days after publication 
in the Federal Register unless, inter alia, the rule relieves a 
restriction or good cause is otherwise found to shorten the time 
period.\56\ Section 553(b)(B) of the APA authorizes agencies to 
dispense with certain procedures when the agency, for good cause, finds 
that those procedures are ``impracticable, unnecessary, or contrary to 
public interest.'' \57\ For the following reasons the Commission is 
using the ``Good Cause'' exemption. This Final Rule must become 
effective by 12 a.m. on October 1, 2010 or the price cap on 
reassignments of electric transmission capacity will be reinstated. 
Reinstating the price cap would impose a restriction on the rights of 
transmission customers. Thus, this Final Rule relieves a restriction. 
Furthermore, the Commission finds that good cause exists to make this 
Final Rule effective immediately because allowing the price cap to be 
reinstated temporarily could disrupt the efficient management of the 
secondary market for electric transmission capacity and reduce 
opportunities for further reduction of transmission congestion.
---------------------------------------------------------------------------

    \56\ 5 U.S.C. 553(d) (2006).
    \57\ 5 U.S.C. 553(b)(B) (2006).
---------------------------------------------------------------------------

    54. The Commission has determined, with the concurrence of the 
Administrator of the Office of Information and Regulatory Affairs of 
OMB, that this rule is not a ``major rule'' as defined in section 351 
of the Small Business Regulatory Enforcement Fairness Act of 1996.

List of Subjects in 18 CFR Part 35


    By the Commission.
Nathaniel J. Davis, Sr.,
Deputy Secretary.

    Note: The following Appendices will not appear in the Code of 
Federal Regulations.

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[FR Doc. 2010-23836 Filed 9-23-10; 8:45 am]
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