Docket Nos. ER22-1728-000, ER22-1728-001
Today’s order sets the “incentive rate” portion of Basin Electric Power Cooperative’s (Basin) revised Wholesale Power Contract with Upper Missouri G. & T. Electric Cooperative, Inc. (Upper Missouri) for hearing and settlement judge procedures. It does so despite all potentially impacted entities filing comments in support of the incentive rate. I would have accepted the revised Wholesale Power Contract in its entirety, subject to the outcome of the proceeding in Docket No. EL20-68-000, et al., without hearing or settlement. Nonetheless, I concur in today’s order simply because, while it may be an exercise in wasting time and money, the parties are able to refile the same rate as a settlement if they so wish.[1]
All the key players to the load incentive rate arrangement support the revised Wholesale Power Contract: (1) Basin, the ultimate wholesale supplier; (2) Upper Missouri, Basin’s wholesale customer; (3) Mountrail-Williams Electric Cooperative (Mountrail-Williams), Upper Missouri’s wholesale customer; and (4) Atlas Power (ND) LLC (Atlas), the ultimate retail customer.[2] Further, no other Basin customer — direct or indirect — protested the filing. So, the question remains: where is the customer harm?
Ironically, the Commission itself harms Basin and its members by dragging them into hearing and settlement proceedings when they have already reached an agreement. Indeed, both Mountrail-Williams and Atlas “confirm[] that the rates, terms, and conditions provided for in [the revisions to the Wholesale Power Contract] were duly and voluntarily negotiated between (1) [Basin] and Upper Missouri, (2) Upper Missouri and Mountrail-Williams, and (3) Mountrail-Williams and [Atlas], which is the new retail load addressed in the [revisions].”[3] I imagine a formal settlement reached between the parties will mirror Basin’s filing here. Thus, hearing and settlement judge procedures will simply result in needless legal fees for the parties and will waste the Commission’s resources.
I also have concerns with another element of today’s order. Although the order states that Basin’s filing lacks cost support, the order does not address Basin’s request that it be granted waiver of the Commission’s filing requirements under sections 35.13(d), (e), and (h).[4] I would have found that granting waiver here is appropriate, given the support of Basin’s filing by Upper Missouri, Mountrail-Williams, and Atlas. In contrast, if the Commission were concerned that Basin failed to provide the necessary cost information to evaluate Basin’s filing, the proper recourse would have been to reject the filing without prejudice or to issue a deficiency letter.[5] To do otherwise would simply mean the Commission is using its discretion to set filings for hearing and settlement proceedings to pick winners and losers among filing parties.
For these reasons cited above, I concur.
[1] Under the Commission’s Rules and Regulations, 18 C.F.R. § 385.102 (2021), Commission Trial Staff is a “participant” and not a “party.” The “[Commission’s] regulations concerning settlements give the Commission broad discretion as to the weight that [it] gives comments filed by Trial Staff, regardless of whether those comments are considered to render the settlement contested.” PJM Interconnection, L.L.C, 157 FERC ¶ 61,181, at P 7 (2016). In evaluating a proposed settlement, the Commission has routinely accepted offers that are uncontested by all parties. See State of Maine, 91 FERC ¶ 61,213, at 61,772 (2000) (“our strong support of settlements militates in favor of giving these parties certainty, and letting them receive the full benefits of their bargain”); San Diego Gas & Elec. Co. v. Sellers of Energy & Ancillary Servs., 122 FERC ¶ 61,009, at P 13 (2008) (“the Commission strongly favors settlements, particularly in cases that are highly contested and complex.”); Montana Power Co., 77 FERC ¶ 61,110, at 61,434 (1996) (“the Commission strongly favors settlements, which provide the opportunity to eliminate the need for more lengthy proceedings if the parties reach an agreement on the issues that is compatible with the public interest”).
[2] Further, I note that Atlas itself has confirmed that it is “price sensitive and would have elected to locate its data center and offices somewhere other than in Mountrail-Williams’ service territory if Upper Missouri had not been able to negotiate the rates, terms, and conditions provided for in the [revisions to the Wholesale Power Contract].” Atlas Comments at 2. A captive customer it is not.
[3] Id.; see also Mountrail-Williams Comments at 2.
[4] Transmittal at 11.
[5] See, e.g., Basin Elec. Power Coop., 169 FERC ¶ 61,158, at P 19 (2019) (“[W]e find that Basin’s Rate Schedule A filings in Docket Nos. ER19-2909-000 and ER19-2909-001 and the [Open Access Transmission Tariff] filing in Docket No. ER19-2911-000 fail to comply with the Commission’s filing requirements. We therefore find these filings to be patently deficient and reject them without prejudice.”).