[Federal Register: November 14, 2005 (Volume 70, Number 218)]
[Notices]
[Page 69149-69151]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr14no05-48]
[[Page 69149]]
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DEPARTMENT OF ENERGY
Federal Energy Regulatory Commission
Order Revoking Market-Based Rate Authority, Establishing Hearing
and Settlement Judge Procedures, and Terminating Section 206 Proceeding
Issued November 3, 2005.
Before Commissioners: Joseph T. Kelliher, Chairman; Nora Mead
Brownell, and Suedeen G. Kelly.
In the matter of: ER98-3809-000, ER97-2867-000, ER98-4685-000,
ER00-105-000, ER97-512-000, ER00-861-000, ER97-2132-000, ER01-2355-
000, ER00-679-000, ER98-701-000, ER01-1701-000, ER00-2945-000, ER01-
2138-000, ER90-225-000, ER99-964-000, ER97-1968-000, ER05-737-000,
ER98-1790-000, ER96-2624-000, ER01-2071-000, ER94-1161-000, ER94-
1099-000, ER99-3098-000, ER98-2020-000, ER98-2918-000, ER96-358-000,
ER01-2221-000, ER96-138-000, ER99-254-000, ER98-3233-000, ER01-666-
000, ER97-382-000, ER96-918-000, ER00-1258-000, ER97-3580-000, ER02-
687-000, ER96-1933-000, ER01-1078-000, ER01-2405-000, ER98-4334-000,
ER01-3023-000, ER01-2129-000, ER96-1819-000, ER95-802-000, ER98-
3478-000, ER00-1519-000, ER01-688-000, ER00-2306-000, ER95-784-000,
ER95-295-000, ER95-232-000, ER03-1259-000, ER94-1672-000, ER02-30-
000, ER01-1507-000, ER00-1781-000, ER99-801-000, ER99-1156-000,
ER95-78-000, ER01-2509-000, ER02-1238-000, ER94-1593-000, ER95-192-
000, ER01-352-000, ER98-2618-000, ER99-2537-000, ER97-2681-000,
ER96-2892-000, ER98-1915-000, ER94-152-000, ER97-1716-000, ER01-904-
000, ER98-622-000, ER02-41-000, ER98-3048-000, ER98-1125-000, ER01-
1479-000, ER02-845-000, ER97-181-000, ER99-2883-000, ER95-379-000,
ER03-372-000, ER01-1821-000, ER99-3275-000, ER96-2303-000, ER97-
3187-000, ER96-1-000, ER01-2463-000, ER95-968-000, ER99-1876-000,
ER96-404-018 ER02-809-000, ER96-1516-000, ER01-2217-002 ER96-2524-
000, ER01-2694-000, ER01-373-002, ER00-494-000, ER98-1055-000, ER01-
3148-000, ER01-2234-000, ER04-957-000, ER96-105-000, ER01-1709-000,
ER02-1046-000, ER98-537-000, EL05-111-000; 3E Technologies, Inc., AC
Power Corporation, ACN Power, Inc., AI Energy, Inc., A'Lones Group,
Inc., Alrus Consulting, LLC, Atlantic Energy Technologies, I Inc.,
Beacon Generating, LLC, Black River Power, LLC, California Polar
Power Broker, L.L.C., Callaway Golf Company, Candela Energy
Corporation, Capital Energy, Inc., Chicago Electric Trading, L.L.C.,
Cielo Power Market, L.P., Colonial Energy, Inc., Commerce Energy
Inc., Competisys LLC, Cumberland Power, Inc., Desert Power, L.P.,
Direct Electric Inc., Eclipse Energy, Inc., EGC 1999 Holding
Company, L.P., Energy Clearinghouse Corp., Energy PM, Inc., Energy
Resource Management Corp., Energy Transfer-Hanover Ventures, LP,
EnergyOnline, Inc., ENMAR Corporation, Environmental Resources
Trust, Inc., EWO Marketing, L.P., Exact Power Co., Inc., Federal
Energy Sales, Inc., First Electric Cooperative Corporation, First
Power, LLC, FMF Energy, Inc., Gelber Group, Inc., George Colliers,
Inc., GNA Energy, LLC, Golden Valley Power Company, Hinson Power
Company, LLC, Holt Company of Ohio, ICC Energy Corporation, IEP
Power Marketing, LLC, INFINERGY Services, LLC, InPower Marketing
Corporation, IPP Energy LLC, It's Electric &Gas, L.L.C., J. Anthony
& Associates Ltd, Kaztex Energy Ventures, Inc., Kimball Power
Company, Kloco Corporation, Lambda Energy Marketing Company,
Longhorn Power, LP, Lumberton Power, LLC, Marquette Energy, LLC,
Metro Energy Group, LLC, Michigan Gas Exchange, L.L.C., Mid-American
Resources, Inc., Morrow Power, LLC, MPC Generating, LLC, National
Power Exchange Corp., National Power Management Company, Natural Gas
Trading Corporation, Nautilus Energy Company, Navitas, Inc., New
Millennium Energy Corp., NGTS Energy Services, Nine Energy Services,
LLC, North American Energy Conservation, Inc., North Atlantic
Utilities Inc., North Carolina Power Holdings, LLC, North Star Power
Marketing, LLC, North Western Energy Marketing, LLC, Northeast
Electricity Inc., Northeast Empire L.P. 2, Northwest
Regional Power, LLC, Northwestern Wind Power, LLC, Oceanside Energy,
Inc., Old Mill Power Company, Peak Energy, Inc., Peak Power
Generating Company, Power Dynamics, Inc., Power Management Co., LLC,
Power Providers Inc., Power Systems Group, Inc., Powertec
International, LLC, Pro-Energy Development LLC, Progas Power Inc.,
PS Energy Group, Inc., Questar Energy Trading Company, Renewable
Energy Resources LLC, SEMCOR Energy, Sunrise Power Company, Symmetry
Device Research, Inc., The Energy Group of America, Inc., Tiger
Natural Gas, Inc., TransAlta Centralia Generation LLC, TransAlta
Energy Marketing (US) Inc., TransAlta Energy Marketing Corp. (US),
Travis Energy & Environment, Inc., TXU Electric Delivery Company,
U.S. Power & Light, Inc., VIASYN, Inc., Walton County Power, LLC,
Western Energy Marketers, Inc.
1. In this order, the Commission revokes the market-based rate
authority of the companies that failed to comply with the Commission's
May 31, 2005 Order \1\ and the conditions under which the Commission
granted them market-based rate authority. In addition, the Commission
will revoke the market-based rate authority of two entities who
responded to the May 31 Order, but did so in a patently deficient
manner. The market-based rate tariffs of these entities are terminated
effective on the date of issuance of this order. Furthermore, we will
direct these entities to inform the Commission whether they have made
any sales pursuant to their market-based rate tariffs after the refund
effective date established in this proceeding, and, for those entities
that have made such sales or that fail to respond, we will establish
hearing and settlement judge procedures to determine whether and in
what amount these entities should be required to disgorge their profits
from these sales. In addition, this order accepts filings notifying the
Commission that certain entities were inadvertently included in the May
31 Order.\2\
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\1\ 3E Technologies, Inc., 111 FERC ] 61,295 (2005) (May 31
Order).
\2\ The Commission has also received a number of updated and
revised market power analyses in response to the May 31 Order, which
will be addressed in a separate order.
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Background
2. As a condition of receiving market-based rate authority, the
Commission requires market-based rate sellers to submit an updated
market power analysis every three years \3\ to allow the Commission to
evaluate the reasonableness of their charges and to provide for ongoing
monitoring of their ability to exercise market power. In the absence of
an updated market power analysis, the Commission cannot exercise its
statutory duty to ensure that market-based rates are just and
reasonable and that market-based rate sellers continue to lack the
potential to exercise market power so that market forces are in fact
determining the price.
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\3\ See, e.g., Western Resources, Inc., 94 FERC ] 61,050 at
61,247 (2001); Entergy Services, Inc., 58 FERC ] 61,234 at 61,760
(1992); PSI Energy, Inc., 51 FERC ] 61,367 at 62,209 (1990).
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3. In the May 31 Order, the Commission announced its policy with
respect to entities that have failed to comply with the conditions
under which the Commission granted them market-based rate authority,
namely, the requirement to submit an updated or revised market power
analysis. In that order, the Commission directed these market-based
rate sellers to file their updated or revised market analyses within 60
days from the issuance of that order or to provide satisfactory support
for why they should not be required to do so. The Commission also
established a refund effective date under section 206 of the Federal
Power Act (FPA) for the protection of customers.\4\
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\4\ 16 U.S.C. 824e (2000).
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4. On June 8, 2005, in response to the May 31 Order, Questar Energy
Trading Company (Questar) filed only a statement that there has been no
change in the facts relied upon by the Commission when it initially
granted Questar market-base rate authority.
5. On June 28, 2005, in response to the May 31 Order, Tiger Natural
Gas, Inc. (Tiger) refiled its initial application for market-based
rates, which it originally filed November 6, 2000.
[[Page 69150]]
Discussion
Revocation of Market-Based Rate Authority and Termination of Market-
Based Rate Tariffs
6. The entities listed in Appendix A of this order have made no
filing in response to the Commission's May 31 Order. In the May 31
Order, we stated that we would revoke the market-based rate authority
and terminate the market-based rate tariff of any market-based rate
seller that failed to file the required updated or revised market power
analysis. Accordingly, we hereby revoke the market-based rate authority
of the entities identified in Appendix A of this order and terminate
their market-based rate tariffs, effective on the date of issuance of
this order.
7. We find that the filings submitted by Questar and Tiger do not
satisfy the Commission's directive in the May 31 Order. We note that
Questar did not submit any market power analysis whatsoever and instead
states that there have been no changes since its market-based rate
tariff was accepted on January 29, 1996. Tiger simply refiled the same
initial application for market-based rate authorization that it
submitted five years ago. The Commission requires that an updated
market power analysis contain current information. The submissions of
Questar and Tiger are patently deficient and thus fail to comply with
the clear directive in the May 31 Order. Accordingly, we revoke
Questar's and Tiger's market-based rate authority and terminate their
market-based rate tariffs, effective on the date of issuance of this
order.
8. Furthermore, any waivers and authorizations previously granted
in connection with the market-based rate authority of the entities
listed in Appendix A, Questar, and Tiger are no longer applicable.
Disgorgement of Profits
9. As discussed above, the May 31 Order established a refund
effective date in this proceeding. If any of the entities listed in
Appendix A, Questar, or Tiger made sales pursuant to their market-based
rate tariffs after the refund effective date established in this
proceeding, they may be required to disgorge their profits from those
sales. Accordingly, we direct the entities listed in Appendix A,
Questar, and Tiger to inform the Commission within five days of the
issuance of this order whether they have made such sales at market-
based rates during this period. For the entities that inform the
Commission that they have not made any such sales during this period,
the Commission will terminate the section 206 proceeding with respect
to them and will not impose the remedy of disgorgement.
10. For any entities that inform the Commission that they have made
such sales or that fail to respond, we will establish hearing and
settlement judge procedures to determine whether and in what amount
these entities should be required to disgorge their profits from these
sales. These entities have failed to comply with the conditions of
their market-based rate authorizations, namely, the obligation to file
an updated market power analysis when requested to do so by the
Commission. Their failure to comply with this express obligation
impeded the Commission's ability to ensure that utilities do not
acquire market power and that rates remain just and reasonable. Under
these circumstances, we find that disgorgement of the profits earned on
transactions during this period is justified.
11. While we are setting these matters for a trial-type evidentiary
hearing, we encourage the parties to make every effort to settle their
dispute before hearing procedures are commenced. To aid the parties in
their settlement efforts, we will hold the hearing in abeyance and
direct that a settlement judge be appointed, pursuant to Rule 603 of
the Commission's Rules of Practice and Procedure.\5\ If the parties
desire, they may, by mutual agreement, request a specific judge as the
settlement judge in the proceeding; otherwise, the Chief Judge will
select a judge for this purpose.\6\ The settlement judge shall report
to the Chief Judge and the Commission within 60 days of the date of
this order concerning the status of settlement discussions. Based on
this report, the Chief Judge shall provide the parties with additional
time to continue their settlement discussions or provide for
commencement of a hearing by assigning the case to a presiding judge.
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\5\ 18 CFR 385.603 (2005).
\6\ If the parties decide to request a specific judge, they must
make their joint request to the Chief Judge by telephone at (202)
502-8500 within five days of this order. The Commission's Web site
contains a list of Commission judges and a summary of their
background and experience (http://www.ferc.gov_click on Office of
Administrative Law Judges).
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Entities Inadvertently Included in May 31 Order
12. The inclusion in the May 31 Order of the entities listed in
Appendix B of this order was inadvertent, and we hereby terminate the
section 206 proceeding with regard to them.
The Commission orders:
(A) The market-based rate authority of the entities listed in
Appendix A, Questar, and Tiger is hereby revoked. The market-based rate
tariffs of those entities are terminated effective on the date of
issuance of this order and any waivers and authorizations previously
granted in connection with the market-based rate authority of these
entities are no longer applicable.
(B) The entities listed in Appendix A, Questar, and Tiger are
directed to inform the Commission within five days of the issuance of
this order whether they have made any sales pursuant to their market-
based rate tariffs after the refund effective date established in this
proceeding, as discussed above.
(C) Pursuant to the authority contained in and subject to the
jurisdiction conferred upon the Federal Energy Regulatory Commission by
section 402(a) of the Department of Energy Organization Act and by the
Federal Power Act, particularly sections 205 and 206 thereof, and
pursuant to the Commission's Rules of Practice and Procedure and the
regulations under the Federal Power Act (18 CFR, Chapter I), a public
hearing shall be held in Docket No. EL05-111 to determine whether and
in what amount the entities listed in Appendix A, Questar, and Tiger
should be required to disgorge any profits from sales made pursuant to
their market-based rate tariffs after the refund effective date
established in this proceeding, as discussed in the body of this order.
However, the hearing shall be held in abeyance to provide time for
settlement judge procedures, as discussed in Paragraphs (D) and (E)
below.
(D) Pursuant to Rule 603 of the Commission's Rules of Practice and
Procedure, 18 CFR 385.603 (2005), the Chief Administrative Law Judge is
hereby directed to appoint a settlement judge in this proceeding within
fifteen (15) days of the date of this order. Such settlement judge
shall have all powers and duties enumerated in Rule 603 and shall
convene a settlement conference as soon as practicable after the Chief
Judge designates the settlement judge. If the parties decide to request
a specific judge, they must make their request to the Chief Judge
within five (5) days of the date of this order.
(E) Within sixty (60) days of the date of this order, the
settlement judge shall file a report with the Commission and the Chief
Judge on the status of the settlement discussions. Based on this
report, the Chief Judge shall provide the parties with additional time
to continue their settlement discussions, if appropriate, or assign
this case to a presiding judge for a trial-type
[[Page 69151]]
evidentiary hearing, if appropriate. If settlement discussions
continue, the settlement judge shall file a report at least every sixty
(60) days thereafter, informing the Commission and the Chief Judge of
the parties' progress toward settlement.
(F) If settlement judge procedures fail and a trial-type
evidentiary hearing is to be held, a presiding judge, to be designated
by the Chief Judge, shall, within fifteen (15) days of the date of the
presiding judge's designation, convene a prehearing conference in these
proceedings in a hearing room of the Commission, 888 First Street, NE.,
Washington, DC 20426. Such a conference shall be held for the purpose
of establishing a procedural schedule. The presiding judge is
authorized to establish procedural dates and to rule on all motions
(except motions to dismiss) as provided in the Commission's Rules of
Practice and Procedure.
(G) The section 206 proceeding instituted in Docket No. EL05-111-
000 is hereby terminated with regard to the entities listed in Appendix
B of this order.
(H) The Secretary is directed to publish a copy of this order in
the Federal Register.
By the Commission.
Magalie R. Salas,
Secretary.
Appendix A
The following market-based rate sellers have failed to submit a
response to the Commission's May 31 Order. As discussed above, we
revoke the following entities' authority to sell power at market-based
rates and terminate their electric market-based rate tariffs: 3E
Technologies, Inc., AC Power Corporation, ACN Power, Inc., AI Energy,
Inc., A'Lones Group, Inc., Alrus Consulting, LLC, Astra Power, LLC,
Atlantic Energy Technologies, Inc., Beacon Generating, LLC, Black River
Power, LLC, California Polar Power Broker, L.L.C., Callaway Golf
Company, Candela Energy Corporation, Capital Energy, Inc., Chicago
Electric Trading, L.L.C., Cielo Power Market, L.P., Colonial Energy,
Inc., Competisys LLC, Cumberland Power, Inc., Direct Electric Inc.,
Eclipse Energy, Inc., EGC 1999 Holding Company, L.P., Energy
Clearinghouse Corp., Energy PM, Inc., Energy Resource Management Corp.,
Energy Transfer-Hanover Ventures, LP, EnergyOnline, Inc., ENMAR
Corporation, Environmental Resources Trust, Inc., Exact Power Co.,
Inc., Federal Energy Sales, Inc., First Electric Cooperative
Corporation, First Power, LLC, FMF Energy, Inc., Gelber Group, Inc.,
George Colliers, Inc., GNA Energy, LLC, Golden Valley Power Company,
Hinson Power Company, LLC, Holt Company of Ohio, ICC Energy
Corporation, IEP Power Marketing, LLC, INFINERGY Services, LLC, InPower
Marketing Corporation, IPP Energy LLC, It's Electric & Gas, L.L.C., J.
Anthony & Associates Ltd, Kaztex Energy Ventures, Inc., Kimball Power
Company, Kloco Corporation, Lambda Energy Marketing Company, Longhorn
Power, LP, Lumberton Power, LLC, Marquette Energy, LLC, Metro Energy
Group, LLC, Michigan Gas Exchange, L.L.C., Mid-American Resources,
Inc., Morrow Power, LLC, National Power Exchange Corp., National Power
Management Company, Natural Gas Trading Corporation, Nautilus Energy
Company, Navitas, Inc., New Millennium Energy Corp., NGTS Energy
Services, Nine Energy Services, LLC, North American Energy
Conservation, Inc., North Atlantic Utilities Inc., North Carolina Power
Holdings, LLC, North Star Power Marketing, LLC, Northeast Electricity
Inc., Northeast Empire L.P. 2, Northwest Regional Power, LLC,
Northwestern Wind Power, LLC, Oceanside Energy, Inc., Old Mill Power
Company, Peak Energy, Inc., Peak Power Generating Company, Power
Dynamics, Inc., Power Management Co., LLC, Power Providers Inc., Power
Systems Group, Inc., Powertec International, LLC, Pro-Energy
Development LLC, Progas Power Inc., PS Energy Group, Inc., Renewable
Energy Resources LLC, SEMCOR Energy, Symmetry Device Research, Inc.,
The Energy Group of America, Inc., Travis Energy & Environment, Inc.,
U.S. Power & Light, Inc., VIASYN, Inc., and Western Energy Marketers,
Inc.
Appendix B
The following market-based rate sellers were inadvertently included
on the May 31 Order. We therefore terminate the section 206 proceeding
instituted in Docket No. EL05-111-000 with regard to these entities:
Commerce Energy, Inc., Desert Power, L.P., EWO Marketing, L.P., MPC
Generating, LLC, NorthWestern Energy Marketing, L.L.C., Sunrise Power
Company, LLC, TransAlta Centralia Generation LLC, TransAlta Energy
Marketing (US) Inc., TransAlta Energy Marketing Corp. (US), TXU
Electric Delivery Company, and Walton County Power, LLC.
[FR Doc. E5-6241 Filed 11-10-05; 8:45 am]
BILLING CODE 6717-01-P