An Arkansas-based grid operator argued in federal court today that the Federal Energy Regulatory Commission failed to adequately review all evidence before allowing a competitor to use its transmission lines.Southwest Power Pool told the U.S. Court of Appeals for the District of Columbia Circuit that FERC simply disregarded the case it presented before siding with the Midwest Independent Transmission System Operator.
FERC “refused to consider any of the evidence of the other point,” said attorney Barry Stewart Spector, arguing on SPP’s behalf. “It can’t just consider one party’s evidence and ignore the other party’s.”
The dispute arose after New Orleans-based Entergy Corp., the second-largest nuclear generator in the country, announced plans in May 2011 to join MISO’s network.
MISO, which has members in 15 predominantly Midwestern states and a Canadian province, is scheduled to absorb Entergy’s Arkansas arm into its transmission network by the end of this year.
Entergy is currently connected to both MISO and SPP’s network. In order to fully incorporate Entergy’s electricity – based in Arkansas, Mississippi, Louisiana and Texas – MISO proposed transferring the electricity over some SPP lines.
SPP is based in the lower Great Plains and lower Mississippi Valley region, and the operator claimed MISO’s plan ran afoul of a joint operating agreement that governs how the neighboring networks share transmission lines. SPP claimed the agreement allowed MISO to use its lines without compensating it only when it was moving electricity from a third party.
Once Entergy integrates into MISO’s footprint, SPP contends, it is no longer a third party. The agreement, it says, was intended to apply to distant and separate transmission systems, not ones within MISO’s internal network.
MISO asked FERC to resolve the dispute, and in July 2011, FERC ruled that MISO could use SPP’s power lines (E&ENews PM, July 5, 2011).
But Spector said FERC issued its judgment “summarily” – likely to move through the issue quickly – and got the facts wrong.
SPP also argues that the joint operating agreement was negotiated in 2004, before Entergy and MISO announced their plans. The operator says the terms of the contract did not envision the current scenario.
FERC attorney Carol Banta argued that the commission adequately engaged with the agreement language at issue.
“The commission believed it had enough,” Banta said.
The three-judge panel – Judge Thomas Griffith and Senior Judge Stephen Williams, Republican appointees, and Judge David Tatel, a Democratic appointee – asked few questions during the arguments.
Williams, however, seemed skeptical of whether FERC had fulfilled its obligation to adequately weigh the issues if it ended consideration before weighing SPP’s evidence.
“The idea of stopping there seems very odd,” he said.
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