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Federal Energy Regulatory Commission

Industries Electric General Information Exempt Wholesale Generators (EWG)

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The Significance of EWG Status

There is no obligation for a company engaging in wholesale generating operations to become an EWG. EWG status under PUHCA 2005 has significance primarily for the EWG’s owners rather than the EWG itself. That significance takes the form of exemptions from or waivers of requirements under PUHCA 2005.

Section 366.3(a) of the Commission’s regulations, 18 CFR § 366.3(a) External Link, provides that any person that is a holding company solely with respect to one or more EWGs, Foreign Utility Companies, or Qualifying Facilities under the Public Utility Regulatory Policies Act of 1978 will be exempt from the regulations on Commission access to holding company books and records found at section 366.2 External Link and the accounting and record keeping requirements found at section 366.21 External Link, 18 CFR §§ 366.2 External Link, 366.21 External Link. In addition, any associated service company will be exempt from the requirements of section 366.2 External Link, the accounting and record keeping requirement for service companies found at 366.22 External Link, and the annual filing requirements found at 366.23 External Link, 18 CFR §§ 366.2 External Link, 366.22 External Link, 366.23 External Link. The holding company is also exempt from the notice of holding company filing requirements found at section 366.4, 18 CFR § 366.4 External Link.

The EWG status of generating subsidiaries can also have significance for holding companies that qualify as a single-state holding company system and thus qualify for the waiver of PUHCA 2005 requirements applicable to such holding companies. See 18 C.F.R. § 366.3(c) External Link. Section 366.3(c)(1) of the Commission’s regulations, 18 CFR § 366.3(c)(1), defines a single-state holding company system as “one that derives no more than 13 percent of its public-utility company revenues from outside a single-state.” The waiver available to single-state holding company systems essentially preserves the status quo for holding companies that qualified for a single-state holding company exemption under PUHCA 1935 by in effect finding that revenues from EWGs and certain other exempt entities do not qualify as public-utility company revenues. Under PUHCA 1935, these revenues were not public-utility company revenues because these companies were not public-utility companies for purposes of the statute. They are, however, public-utility companies under PUHCA 2005. The Commission’s current regulations specify that revenues derived from EWGs are not considered to be public-utility company revenues. 18 CFR § 366.3(c)(1) External Link. As a result, single-state holding company system status is not affected if the holding company acquires out-of-state EWGs. The Commission’s regulations permit a single-state holding company to seek waivers of the accounting, record retention and reporting requirements of sections 366.21 External Link, 366.22 External Link and 366.23 External Link of the regulations.