FERC sends dispute over landfill gas project into hearing process

At their monthly meeting on Jan. 17, the commissioners at the Federal Energy Regulatory Commission decided to put a long-running dispute between power plant developer North American Natural Resources and affiliates of American Electric Power (NYSE: AEP) into a trial-type hearing, while urging the parties to settle the dispute in the meantime.

On Oct. 2, 2012, North American filed a complaint against American Electric Power Service Corp., Indiana Michigan Power (both units of AEP) and PJM Interconnection under section 206 of the Federal Power Act (FPA) and Rule 206 of the commission’s Rules of Practice and Procedure. North American alleged violations of PJM’s Open Access Transmission Tariff provisions governing small generator interconnections to the transmission system.

In December 2007, North American submitted an application to PJM for the interconnection of the 6.4-MW Southeast Berrien landfill gas generating station in Berrien County, Mich., to AEP’s 69-kV Buchanan Hydro-Niles transmission line. PJM assigned the Southeast Berrien Plant to queue position T-111.

In studying North American’s interconnection request, PJM determined that upgrades to the Buchanan Hydro substation and Niles substation would be necessary, and that a new switching station—the Mayflower substation—was needed to interconnect the plant. North American exercised its contractual option to build the Mayflower substation. That infrastructure was built and the Southeast Berrien Plant commenced commercial operations in May 2009.

“The dispute in this case involves multiple issues concerning the construction of the aforementioned interconnection facilities and PJM’s management of the interconnection process and cost allocation,” said the Jan. 17 FERC order. “The parties were engaged in settlement negotiations with the Commission’s Dispute Resolution Staff for more than two years. The complaint now before us was filed following the parties’ failure to negotiate a settlement during those negotiations.”

FERC added: “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 commence. 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.”