[Code of Federal Regulations]
[Title 18, Volume 1]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 18CFR2.20]

[Page 23-26]
 
           TITLE 18--CONSERVATION OF POWER AND WATER RESOURCES
 
  CHAPTER I--FEDERAL ENERGY REGULATORY COMMISSION, DEPARTMENT OF ENERGY
 
PART 2_GENERAL POLICY AND INTERPRETATIONS--Table of Contents
 
Sec. 2.20  Good faith requests for transmission services and good 
faith responses by transmitting utilities.

    (a) General Policy. (1) This Statement of Policy is adopted in 
furtherance of the goals of sections 211(a) and 213(a) of the Federal 
Power Act, as amended and added by the Energy Policy Act of 1992.
    (2) Under section 211(a), the Commission may issue an order 
requiring a transmitting utility to provide transmission services 
(including any enlargement of transmission capacity necessary to provide 
such services)

[[Page 24]]

only if an applicant has made a request for transmission services to the 
transmitting utility that would be the subject of such order at least 60 
days prior to its filing of an application for such order. The 
requirement in section 211(a) that an applicant make such a request will 
be met if such an applicant has, pursuant to section 213(a) of the FPA, 
made a good faith request to a transmitting utility to provide wholesale 
transmission services and requests specific rates and charges, and other 
terms and conditions.
    (3) It is the Commission's intention to apply the standards of this 
Statement of Policy when determining whether and when a valid ``good 
faith'' request for service was made.
    (4) It is the Commission's intention to encourage an open exchange 
of information that exhibits a reasonable degree of specificity and 
completeness between the party requesting transmission services and the 
transmitting utility.
    (5) The Commission intends to apply this Statement of Policy so as 
to carry out Congress' objective that, subject to appropriate terms and 
conditions and just and reasonable rates, in conformance with section 
212 of the FPA, access to the electric transmission system for the 
purposes of wholesale transactions be more widely available.
    (b) The Components of a good faith request. The Commission generally 
considers the following to constitute the minimum components of a good 
faith request for transmission services:
    (1) The identity, address, telephone number, and facsimile number of 
the party requesting transmission services, and the same information, if 
different, for the party's contact person or persons.
    (2) A statement that the party requesting transmission services is, 
or will be upon commencement of service, an entity eligible to request 
transmission under sections 211(a) and 213(a) of the FPA.
    (3) A statement that the request for transmission services is 
intended to satisfy the ``request for transmission services'' 
requirement under sections 211(a) and 213(a) of the FPA, and that the 
request is not a request for mandatory retail wheeling prohibited under 
section 212(h) of the FPA.
    (4) The party requesting transmission services should specify the 
character and nature of the services requested. Some types of service 
may require more detailed information than others. Where point-to-point 
service is requested, the party requesting transmission services should 
specify the anticipated point(s) of receipt to the transmitting 
utility's grid and the anticipated point(s) of delivery from the 
transmitting utility's grid. Where a party requesting transmission 
services requests additional flexibility to schedule multiple resources 
to meet its needs (e.g., network service), the request for services 
should contain a description of the requested services in sufficient 
detail to permit the transmitting utility to model the additional 
services on its transmission system.
    (5) The names of any other parties likely to provide transmission 
service to deliver electric energy to, and receive electric energy from, 
the transmitting utility's grid in connection with the requested 
transmission services.
    (6) The proposed dates for initiating and terminating the requested 
transmission services.
    (7) The total amount of transmission capacity being requested.
    (8) To the extent it is known or can be estimated, a description of 
the ``expected transaction profile'' including load factor data 
describing the hourly quantities of power and energy the party 
requesting transmission services would expect to deliver to the 
transmitting utility's grid at relevant points of interconnection. In 
the event delivery is to multiple points within the transmitting 
utility's electric control area, the requestor should describe, to the 
extent it is known or can be estimated, the expected load (over a given 
duration of time) at each such delivery point.
    (9) Whether firm or non-firm service is being requested. Where a 
party requests non-firm service, it should specify the priority of 
service it is willing to accept, or the conditions under which it is 
willing to accept interruption or curtailment, if known.

[[Page 25]]

    (10) A statement as to whether the request is being made in response 
to a solicitation and a copy of the solicitation if publicly available. 
This will help the transmitting utility determine whether requests for 
transmission service are duplicative or mutually exclusive of requests 
filed by other parties.
    (11) The proposed rates, terms and conditions for the requested 
transmission services as required by section 213(a). It is not necessary 
for the requestor to propose a specific numerical rate. Rather, a party 
requesting transmission services can fulfill the rates, terms and 
conditions requirement by specifying a rate methodology (e.g., embedded 
or incremental cost) or by referencing an existing formula rate, 
transmission tariff, or transmission contract. The validity of the good 
faith request will not depend on the rates proposed by the party 
requesting transmission services. This requirement is not intended to 
allow utilities to delay responses to requests for transmission 
services, or to deny requests for transmission services on the basis of 
an overly rigid or technical approach to the ``rates, terms and 
conditions'' element of the request.
    (12) Any other information to facilitate the expeditious processing 
of its request. Such information will improve the negotiation process, 
reduce costs, and will improve chances to arrange the requested 
transmission without resorting to section 211 application procedures 
before the Commission.
    (c) Components of a Reply to a Good Faith Request. The Commission 
generally considers the following to constitute the minimum components 
of a reply to a good faith request for transmission services under 
section 213(a):
    (1) Unless the parties agree to a different time frame, the 
transmitting utility must acknowledge the request within 10 days of 
receipt. The acknowledgement must include a date by which a response 
will be sent to the party requesting transmission services and a 
statement of any fees associated with responding to the request (e.g., 
initial studies).
    (2) The transmitting utility may ask the applicant to provide 
clarification of only the information needed to evaluate and process a 
``good faith'' request. If the person requesting transmission services 
believes the transmitting utility is attempting to frustrate the process 
by making excessive requests for clarification, it may raise this issue 
if, and when, it files a request for a section 211 order with the 
Commission.
    (3) The transmitting utility must respond to a request within 60 
days of receipt or some other mutually agreed upon response date. If 
both parties agree to an alternative schedule, the agreement must be in 
writing and signed by both parties.
    (4) If the transmitting utility determines that it can provide all 
the requested services from existing capacity, it should respond by 
offering the party requesting transmission services an executable 
service agreement that at a minimum contains the following information:
    (i) A description of the proposed transmission rate and any other 
costs. It is not necessary for the proposed service agreement to contain 
a fully developed cost-of-service. However, the agreement should explain 
the basis for the charges for each component of service, including the 
unbundled components of any transmission rate as well as any other 
charges.
    (ii) The proposed service agreement should explicitly describe all 
of the applicable terms and conditions of the transmission services 
provided under the agreement.
    (iii) The transmitting utility should accompany the proposed service 
agreement with a clear statement of the time during which the offer to 
provide the transmission services will remain open. An open agreement 
offer may obligate the seller while imposing no countervailing 
obligation on the purchaser, and an unexecuted contract potentially ties 
up transmission facilities, thus jeopardizing the availability and price 
for subsequent requests that would use the same facilities. However, at 
a minimum, a transmitting utility should permit the party requesting 
transmission services sufficient time to review service agreements and 
coordinate multiple stages of joint transactions.

[[Page 26]]

    (5) If the transmitting utility determines that it must construct 
additional facilities or modify existing facilities to provide all or 
part of the requested services, it must:
    (i) Identify the specific constraints and their duration that 
prevent it from providing all the requested services and explain how 
these constraints prevent it from providing all the requested services 
or the desired level of firmness.
    (ii) Provide to the applicant all studies, computer input and output 
data, planning, operating and other documents, work papers, assumptions 
and any other material that forms the basis for determining the 
constraints.
    (iii) Offer to the applicant an executable agreement under which the 
applicant agrees to reimburse the transmitting utility for all costs of 
performing any studies necessary to determine what changes to the 
transmitting utility's grid are needed to overcome the constraint and 
provide the requested services, their cost, and the estimated time to 
complete them. At a minimum, the proposed agreement should contain the 
following:
    (A) An estimate of the cost of the study and the time required to 
complete it, and
    (B) A commitment to supply to the party requesting transmission 
services all computer input and output data, planning, operating and 
other documents, work papers, assumptions and any other material used to 
perform the study.
    (iv) If a transmitting utility determines that it can provide part 
but not all of the requested services without building new facilities, 
it should inform the applicant of any portion of the requested services 
that can be performed without constructing additional facilities or 
modifying existing facilities. In effect, the transmitting utility may 
be able to treat such a request as two separate transactions--one for 
service on existing facilities and the other as a request involving 
expansion decisions. Furthermore, where there are alternative, less 
expensive means of satisfying all or a portion of a transmission 
request, the Commission expects the transmitting utility to explore such 
alternatives (e.g., redispatching certain generating units to alleviate 
a constraint).

[58 FR 38969, July 21, 1993]