SPP seeks court review of two FERC orders relating to Entergy Arkansas’ move to MISO

The Southwest Power Pool (SPP) petitioned the U.S. Court of Appeals for the District of Columbia March 23 to review an order FERC granted to the Midwest ISO (MISO) regarding the pending move of Entergy Arkansas to MISO.

In its less than two-page petition, SPP called the original order and FERC’s rejection of its request for rehearing of that order “arbitrary, capricious, and contrary to law.” The petition did not elaborate on that characterization. (Appeals court case # 12-1158).

“SPP believes the FERC has misinterpreted (in its July 1, 2011, Order granting MISO’s petition for declaratory order) certain terms of the joint operating agreement between SPP and MISO,” an SPP spokesperson told TransmissionHub on April 4. “SPP requested the FERC to rehear the matter and clarify its order, and the FERC rejected SPP’s request.” The next step for SPP was to ask the appeals court to review the FERC Orders.

At the core of the controversy is a FERC ruling on a MISO petition for declaratory order granted on July 1, 2011, and an order seeking rehearing of the matter, which FERC rejected on Jan. 26, 2012  (Docket Nos. EL11-34-000 and -001).

On April 8, 2011, MISO filed a petition seeking commission confirmation that the terms of the joint operating agreement in effect between SPP and MISO (SPP JOA), regarding the sharing of transmission capacity on a common path, will remain in effect and applicable to Entergy Arkansas in the event Entergy Arkansas becomes a transmission-owning member of MISO.

During discussions among SPP, MISO, and Entergy, MISO was asked to confirm the availability of transmission path sharing under section 5.2 of the SPP JOA in the event that Entergy Arkansas joined MISO.

MISO interpreted section 5.2 to mean: “If the parties have contract paths to the same entity, the combined contract path capacity will be made available for use by both parties. This will not create new contract paths for either party that did not previously exist,” according to the 2011 order.

MISO concluded that the transmission-sharing provisions would be applicable to the Entergy interconnection after Entergy becomes a MISO transmission owner and should be interpreted to allow MISO to utilize the combined transmission capacity of the existing SPP interconnections with Entergy and MISO, according to the 2011 FERC order.

SPP challenged MISO’s analysis and concluded that MISO would not be able to rely on the contract path-sharing provisions to use capacity on the SPP transmission system if Entergy Arkansas joined MISO. Among other things, SPP asserted that expiration of the interchange agreement in 2013 would eliminate high voltage ties between MISO and Entergy, and that MISO is limited to transmission capacity on flowgates based on its use of the regional systems as of April I, 2004, according to the 2011 order.

SPP also raised other issues, including MISO’s compensation to SPP and its members for use of the existing SPP transmission; the effect of the potential loss of MISO’s contract path with Entergy Arkansas, which SPP and other protesters viewed as “a real possibility” if Ameren terminates its membership and withdraws from MISO; and the need for more developed congestion management provisions in the SPP JOA to address the additional congestion that will be caused by the integration of Entergy Arkansas into MISO, according to FERC’s 2011 order.

FERC ruled in MISO’s favor on July 1, 2011, finding that the SPP JOA would allow for the sharing of available transmission capacity between MISO, SPP, and Entergy Arkansas. The commission also rejected several protests, including a protest that such a ruling was premature because SPP and MISO had not “exhausted the dispute resolution process [provided by] the SPP JOA.” In its ruling, FERC said the process had resulted in “no progress toward achieving a common understanding” of the disputed section of the SPP JOA, and that its ruling was therefore not premature.

Subsequently, SPP and six other entities filed requests for rehearing and/or clarification. On January 26, FERC denied those requests, prompting SPP to file its petition with the court on March 23.

A spokesperson for the Court of Appeals told TransmissionHub on April 2 it is unlikely the case will be heard until the court’s next term, which begins in September.

Calls seeking comment from SPP were not responded to by press time.

Entergy Arkansas is a subsidiary of Entergy (NYSE:ETR).

This article was updated on April 4 to include comments by SPP.