89346 Federal Register / Vol. 88, No. 247 / Wednesday, December 27, 2023 / Proposed Rules 

VOR/DME. The proposed airway actions 

are described below. 

V–48: V–48 currently extends 

between the Ottumwa, IA, VOR/DME 

and the Pontiac, IL, VOR/DME. The 

FAA proposes to remove the airway 

segment between the Ottumwa VOR/ 

DME and the Burlington, IA, VOR/DME. 

As amended, the airway would be 

changed to extend between the 

Burlington VOR/DME and the Pontiac 

VOR/DME. 

V–52: V–52 currently extends 

between the Des Moines, IA, VOR/ 

Tactical Air Navigation (VORTAC) and 

the Ottumwa, IA, VOR/DME; and 

between the St. Louis, MO, VORTAC 

and the Pocket City, IN, VORTAC. The 

FAA proposes to remove the airway 

segment between the Des Moines 

VORTAC and the Ottumwa VOR/DME. 

As amended, the airway would be 

changed to extend between the St. Louis 

VORTAC and the Pocket City VORTAC. 

V–206: V–206 currently extends 

between the Napoleon, MO, VORTAC 

and the Ottumwa, IA, VOR/DME. The 

FAA proposes to remove the airway 

segment between the Kirksville, MO, 

VORTAC and the Ottumwa VOR/DME 

due to the planned decommissioning of 

the VOR portion of the Ottumwa VOR/ 

DME. Additionally, the FAA proposes 

to also remove the airway segment 

between the Napoleon VORTAC and the 

Kirksville VORTAC due to that airway 

segment overlapping V–10 which will 

remain charted and provide 

navigational guidance between the two 

NAVAIDs. As amended, the airway 

would be revoked in its entirety. 

V–216: V–216 currently extends 

between the Lamar, CO, VOR/DME and 

the Mankato, KS, VORTAC; and 

between the Lamoni, IA, VOR/DME and 

the Janesville, WI, VOR/DME. The FAA 

proposes to remove the airway segment 

between the Lamoni VOR/DME and the 

Iowa City, IA, VOR/DME. As amended, 

the airway would be changed to extend 

between the Lamar VOR/DME and the 

Mankato VORTAC and between the 

Iowa City VOR/DME and the Janesville 

VOR/DME. 

V–434: V–434 currently extends 

between the Ottumwa, IA, VOR/DME 

and the Brickyard, IN, VORTAC. The 

FAA proposes to remove the airway 

segment between the Ottumwa VOR/ 

DME and the Moline, IL, VOR/DME. As 

amended, the airway would be changed 

to extend between the Moline VOR/ 

DME and the Brickyard VORTAC. 

The NAVAID radials listed in the 

VOR Federal Airway descriptions in the 

proposed regulatory text of this NPRM 

are unchanged and stated in degrees 

True north. 

Regulatory Notices and Analyses 

The FAA has determined that this 

proposed regulation only involves an 

established body of technical 

regulations for which frequent and 

routine amendments are necessary to 

keep them operationally current. It, 

therefore: (1) is not a ‘‘significant 

regulatory action’’ under Executive 

Order 12866; (2) is not a ‘‘significant 

rule’’ under DOT Regulatory Policies 

and Procedures (44 FR 11034; February 

26, 1979); and (3) does not warrant 

preparation of a regulatory evaluation as 

the anticipated impact is so minimal. 

Since this is a routine matter that will 

only affect air traffic procedures and air 

navigation, it is certified that this 

proposed rule, when promulgated, will 

not have a significant economic impact 

on a substantial number of small entities 

under the criteria of the Regulatory 

Flexibility Act. 

Environmental Review 

This proposal will be subject to an 

environmental analysis in accordance 

with FAA Order 1050.1F, 

‘‘Environmental Impacts: Policies and 

Procedures’’ prior to any FAA final 

regulatory action. 

List of Subjects in 14 CFR Part 71 

Airspace, Incorporation by reference, 

Navigation (air). 

The Proposed Amendment 

In consideration of the foregoing, the 

Federal Aviation Administration 

proposes to amend 14 CFR part 71 as 

follows: 

PART 71—DESIGNATION OF CLASS A, 

B, C, D, AND E AIRSPACE AREAS; AIR 

TRAFFIC SERVICE ROUTES; AND 

REPORTING POINTS 

■ 1. The authority citation for 14 CFR 

part 71 continues to read as follows: 

Authority: 49 U.S.C. 106(f), 106(g); 40103, 

40113, 40120; E.O. 10854, 24 FR 9565, 3 CFR, 

1959–1963 Comp., p. 389. 

§ 71.1 [Amended] 

■ 2. The incorporation by reference in 

14 CFR 71.1 of FAA Order JO 7400.11H, 

Airspace Designations and Reporting 

Points, dated August 11, 2023, and 

effective September 15, 2023, is 

amended as follows: 

Paragraph 6010(a) Domestic VOR Federal 

Airways. 

* * * * * 

V–48 [Amended] 

From Burlington, IA; Peoria, IL; to Pontiac, 

IL. 

* * * * * 

V–52 [Amended] 

From St Louis, MO; Troy, IL; INT Troy 

099° and Pocket City, IN, 311° radials; to 

Pocket City. 

* * * * * 

V–206 [Removed] 

* * * * * 

V–216 [Amended] 

From Lamar, CO; Hill City, KS; to Mankato, 

KS. From Iowa City, IA; INT Iowa City 062° 

and Janesville, WI, 240° radials; to Janesville. 

* * * * * 

V–434 [Amended] 

From Moline, IL; Peoria, IL; Champaign, IL; 

to Brickyard, IN. 

* * * * * 

Issued in Washington, DC, on December 

19, 2023. 

Frank Lias, 

Manager, Rules and Regulations Group. 

[FR Doc. 2023–28381 Filed 12–26–23; 8:45 am] 

BILLING CODE 4910–13–P 

DEPARTMENT OF ENERGY 

Federal Energy Regulatory 

Commission 

18 CFR Part 33 

[Docket No. AD24–6–000] 

Federal Power Act Section 203 Blanket 

Authorizations for Investment 

Companies 

AGENCY: Federal Energy Regulatory 

Commission. 

ACTION: Notice of inquiry. 

SUMMARY: The Federal Energy 

Regulatory Commission (Commission) 

seeks comment on whether, and if so, 

how, the Commission should revise its 

policy on providing blanket 

authorizations for investment 

companies under the Federal Power 

Act. The Commission also seeks 

comment on what constitutes control of 

a public utility in evaluating holding 

companies’, including investment 

companies’, requests for blanket 

authorization and what factors it should 

consider when evaluating control over 

public utilities as part of a request for 

blanket authorization. 

DATES: Initial comments are due March 

26, 2024 and reply comments are due 

April 25, 2024. 

ADDRESSES: Comments, identified by 

docket number, may be filed in the 

following ways. Electronic filing 

through http://www.ferc.gov, is 

preferred. 

• Electronic Filing: Documents must 

be filed in acceptable native 


ddrumheller on DSK120RN23PROD with PROPOSALS1
Federal Register / Vol. 88, No. 247 / Wednesday, December 27, 2023 / Proposed Rules 89347 

1For the purposes of this NOI, the term 

‘‘investment companies’’ refers to those companies 

meeting the definition of ‘‘investment companies’’ 

in the Investment Company Act of 1940, which 

includes any issuer that ‘‘holds itself out as being 

engaged primarily, or proposes to engage primarily, 

in the business of investing, reinvesting, or trading 

in securities.’’ 15 U.S.C. 80a–3. If commenters 

believe the Commission should apply a different 

definition or use a different term, they are 

encouraged to explain in their comments. 

2 16 U.S.C. 824b(a)(2). 

3 Id. 

4Transactions Subject to FPA Section 203, Order 

No. 669, 113 FERC ¶ 61,315 (2005), order on reh’g, 

Order No. 669–A, 115 FERC ¶ 61,097, order on 

reh’g, Order No. 669–B, 116 FERC ¶ 61,076 (2006); 

see Blanket Authorization Under FPA Section 203, 

Order No. 708, 122 FERC ¶ 61,156, order on reh’g, 

Order No. 708–A, 124 FERC ¶ 61,048 (2008), order 

on reh’g, Order No. 708–B, 127 FERC ¶ 61,157 

(2009) (amending the Commission’s regulations 

pursuant to FPA section 203 to provide for 

additional blanket authorizations under FPA 

section 203(a)(1)). 

5Energy Policy Act of 2005, Public Law 109–58, 

119 Stat. 594 (2005). 

6See 18 CFR 33.1(c). 

7Order No. 669, 113 FERC ¶ 61,315 at P 4. 

8 18 CFR 33.1(c)(9). 

9See id. § (c)(9)(i)–(iv). 

10UBS AG, 101 FERC ¶ 61,312 (2002), order on 

reh’g, 103 FERC ¶ 61,284, order on reh’g, 105 FERC 

¶ 61,078 (2003). 

11UBS AG, 105 FERC ¶ 61,078 at P 16. 

12Cap. Research & Mgmt. Co., 116 FERC ¶ 61,267 

(2006). 

13 15 U.S.C. 78a et seq. 

applications and print-to-PDF, but not 

in scanned or picture format. 

• For those unable to file 

electronically, comments may be filed 

by USPS mail or by hand (including 

courier) delivery. 

Æ Mail via U.S. Postal Service Only: 

Addressed to: Federal Energy 

Regulatory Commission, Secretary of the 

Commission, 888 First Street NE, 

Washington, DC 20426. 

Æ Hand (including courier) delivery: 

Deliver to: Federal Energy Regulatory 

Commission, 12225 Wilkins Avenue, 

Rockville, MD 20852. 

The Comment Procedures Section of 

this document contains more detailed 

filing procedures. 

FOR FURTHER INFORMATION CONTACT: 

Noah Monick (Legal Information), Office 

of the General Counsel, Federal 

Energy Regulatory Commission, 888 

First Street NE, Washington, DC 

20426, Noah.Monick@ferc.gov. 

Michelle Wei (Technical Information), 

Office of Energy Market Regulation, 

Federal Energy Regulatory 

Commission, 888 First Street NE, 

Washington, DC 20426, 

Michelle.Wei@ferc.gov. 

SUPPLEMENTARY INFORMATION: 

1. In this Notice of Inquiry (NOI), the 

Commission seeks comment on 

whether, and if so, how, the 

Commission should revise its policy on 

providing blanket authorizations for 

investment companies 1 under section 

203(a)(2) of the Federal Power Act 

(FPA).2 The Commission also seeks 

comment on what constitutes control of 

a public utility in evaluating holding 

companies’, including investment 

companies’, requests for blanket 

authorization and what factors it should 

consider when evaluating control over 

public utilities or holdings companies 

thereof as part of a request for blanket 

authorization. 

I. Background 

2. Section 203(a)(2) of the FPA 

provides that: 

No holding company in a holding company 

system that includes a transmitting utility or 

an electric utility shall purchase, acquire, or 

take any security with a value in excess of 

$10,000,000 of, or, by any means whatsoever, 

directly or indirectly, merge or consolidate 

with, a transmitting utility, an electric utility 

company, or a holding company in a holding 

company system that includes a transmitting 

utility, or an electric utility company, with a 

value in excess of $10,000,000 without first 

having secured an order of the Commission 

authorizing it to do so.3

3. The Commission has both 

established in its regulations and 

granted by Commission order blanket 

authorizations under section 203(a)(2) 

for transactions that meet certain 

criteria. In Order No. 669,4 the 

Commission promulgated regulations to 

implement the amendments to section 

203 in the Energy Policy Act of 2005 

(EPAct 2005),5 including granting 

blanket authorizations for certain types 

of transactions, such as foreign utility 

acquisitions by holding companies, 

intra-holding company system financing 

and cash management arrangements, 

certain internal corporate 

reorganizations, and certain investments 

in transmitting utilities and electric 

utility companies.6 The Commission 

stated that its goal in promulgating the 

new regulations was ‘‘to ensure that all 

jurisdictional transactions subject to 

section 203 are consistent with the 

public interest and at the same time 

ensure that our rules do not impede 

day-to-day business transactions or 

stifle timely investment in transmission 

and generation infrastructure.’’ 7 For 

example, one of the blanket 

authorizations granted by the 

Commission provides authorization for 

holding companies regulated by the 

Board of Governors of the Federal 

Reserve Bank or by the Office of the 

Comptroller of the Currency, under the 

Bank Holding Company Act of 1956 as 

amended by the Gramm–Leach–Bliley 

Act of 1999, to acquire and hold an 

unlimited amount of the securities of 

holding companies that include a 

transmitting utility or an electric utility 

company.8 The blanket authorization 

requires that the securities be held 

either as a fiduciary, as principal for 

derivatives hedging purposes incidental 

to the business of banking (so long as it 

commits not to vote such securities to 

the extent they exceed 10 percent of the 

outstanding shares), as collateral for a 

loan, or solely for purposes of 

liquidation and in connection with a 

loan previously contracted for and 

owned beneficially for a period of not 

more than two years (subject to 

conditions and a reporting 

requirement).9

4. Prior to Order No. 669, the 

Commission’s order in UBS AG granted 

a blanket authorization on an individual 

basis for UBS AG and Bank of America 

to acquire public utility securities 

during their banking businesses.10 The 

Commission stated that it was satisfied 

that the applicants in that proceeding 

would be precluded from using their 

fiduciary holdings to serve their own 

interests, rather than the interests of 

their fiduciary clients. The Commission 

stated that ‘‘backstop protection is 

provided by the procedures, controls 

and monitoring programs banking 

institutions are required to have in place 

in order to conduct fiduciary activities 

and the comprehensive nature of 

supervision and regulation by Bank 

Regulators of banks’ fiduciary.’’ 11

5. The Commission has also issued 

blanket authorizations, on a casespecific basis to investment companies, 

that allowed the acquisitions of 

securities in public utilities over the $10 

million threshold established by EPAct 

2005 and up to 20% of the outstanding 

voting securities of a given public 

utility. For instance, in 2006, the 

Commission granted a blanket 

authorization for Capital Research and 

Management Company to acquire utility 

securities on behalf of its funds, subject 

to certain conditions.12 As a result of 

these conditions, including limitations 

on the amount of both collective 

ownership and ownership of securities 

for each individual fund, governing 

policies, and status as beneficial owners 

eligible to file Schedule 13G under the 

Securities’ and Exchange Act of 1934,13

the Commission found that Capital 

Research and Management Company 

could not exercise control over public 

utilities, and that there would be no 

harm to the public interest that could 

otherwise result from their holding 

significant equity positions in public 


ddrumheller on DSK120RN23PROD with PROPOSALS1
89348 Federal Register / Vol. 88, No. 247 / Wednesday, December 27, 2023 / Proposed Rules 

14Cap. Research & Mgmt. Co., 116 FERC ¶ 61,267 

at P 32. 

15 Id. PP 26–27 (citing 15 U.S.C. 79a et seq.). 

16 Id. P 28. 

17See Ecofin Holdings Ltd., 120 FERC ¶ 61,189 

(2007); The Goldman Sachs Grp., 121 FERC 

¶ 61,059 (2007); Morgan Stanley, 121 FERC ¶ 61,060 

(2007); Legg Mason, Inc., 121 FERC ¶ 61,061 (2007); 

Horizon Asset Mgmt., Inc., 125 FERC ¶ 61,209 

(2008); Franklin Res., Inc., 126 FERC ¶ 61,250 

(2009); BlackRock, Inc., 131 FERC ¶ 61,063 (2010). 

Additional blanket authorizations were granted via 

delegated authority where applicants met the 

criteria established in previously-issued 

Commission orders. See T. Rowe Price Grp., Inc., 

119 FERC ¶ 62,048 (2007) (delegated order); Lord, 

Abbett & Co. LLC, 129 FERC ¶ 62,239 (2009) 

(delegated order); Mario J. Gabelli GGCP, Inc., 137 

FERC ¶ 62,127 (2011) (delegated order); The 

Vanguard Grp., Inc., 168 FERC ¶ 62,081 (2019) 

(delegated order). 

18See Cap. Research & Mgmt. Co., 116 FERC 

¶ 61,267 at P 46 (‘‘[G]iven the importance of 

balancing the need for regulatory oversight with the 

provision of some business certainty, the 

Commission grants the requested authorizations, as 

conditioned, on a temporary basis. The 

authorization expires three years from the date of 

this order, without prejudice to requests to extend 

the authorization.’’). 

19See, e.g., The Goldman Sachs Grp., 134 FERC 

¶ 61,227 (2011); BlackRock, Inc., 179 FERC ¶ 61,049 

(2022). 

20Control & Affiliation for Purposes of Mkt.- 

Based Rate Requirements Under Section 205 of the 

Fed. Power Act & the Requirements of Section 203 

of the Fed. Power Act, 130 FERC ¶ 61,046, at P 4 

(2010) (citing Securities Exchange Act of 1934, 15 

U.S.C. 78a et seq. (2000)). 

21 Id. PP 36–37 (requiring an affirmation from the 

investor that, among other things, it will: not seek 

or accept representation on the public utility’s 

board of directors or otherwise serve in any 

management capacity; not request or receive nonpublic information, either directly or indirectly, 

concerning the business or affairs of the public 

utility; and not solicit, or participate in any 

solicitation of, proxies involving the public utility). 

22Control & Affiliation for Purposes of Mkt.- 

Based Rate Requirements Under Section 205 of the 

Fed. Power Act & the Requirements of Section 203 

of the Fed. Power Act, 157 FERC ¶ 61,064 (2016). 

23See Lillian Federico, State Regulatory Reviews 

Are Creating Headwinds For Utility Merger Activity, 

S&P GLOBAL (Apr. 5, 2019), https://

www.spglobal.com/marketintelligence/en/newsinsights/research/state-regulatory-reviews-arecreating-headwinds-for-utility-merger-activity. 

24Financial Times, Index Funds Break Through 

$10m-in-Assets Mark, https://www.ft.com/content/ 

a7e20d96-318c-11ea-9703-eea0cae3f0de (Jan. 7, 

2020). 

25 Investment Company Institute, 2022 

Investment Company Factbook, at 29 (2022), 

https://www.icifactbook.org/pdf/2022_factbook.pdf. 

26Commissioners Danly, Clements, and Christie 

have raised concerns related to the influence of 

large investment companies over public utilities 

and whether there is adequate scrutiny in the grant 

of some blanket authorizations. See BlackRock, Inc., 

179 FERC ¶ 61,049 (Clements, Comm’r, concurring 

at P 3); BlackRock, Inc., 179 FERC ¶ 61,049 

(Christie, Comm’r, concurring at PP 4–6); Joint 

Statement of Commissioner Danly & Commissioner 

Christie Regarding The Vanguard Group, Inc. et al., 

Docket No. EC19–57–001, at PP 7–9 (Aug. 11, 2022) 

(eLibrary Accession No. 20220811–4002); Joint 

Statement of Commissioner Danly & Commissioner 

Christie Regarding The Vanguard Group, Inc., et al., 

Docket No. EC19–57–002, at P 7 (May 9, 2023) 

(eLibrary Accession No. 20230509–4000). 

utilities.14 The Commission noted that 

the repeal of the Public Utility Holding 

Company Act of 1935 (PUHCA 1935) 

and modifications to section 203 of the 

FPA had changed the law governing 

investment in utility securities.15 The 

Commission found that a blanket 

authorization was appropriate to 

‘‘encourage greater investment in 

utilities by mutual funds,’’ provided 

that the Commission can perform 

continuing oversight in accordance with 

section 203 of the FPA.16

6. The Commission issued other

individual blanket authorizations after 

its order in Capital Research & 

Management Co. applying similar 

conditions.17 The blanket authorizations 

were time-limited, for a period of three 

years, based on the Commission’s 

reasoning that it should periodically 

reevaluate whether the blanket 

authorizations remained consistent with 

the public interest.18 The Commission 

has in several instances granted 

subsequent requests for extensions of 

those blanket authorizations upon the 

same terms and conditions of the 

original orders.19

7. In 2010, the Commission undertook

a generic proceeding to address the 

acquisition of voting securities of a 

public utility by holding companies in 

response to a petition by the Electric 

Power Supply Association (EPSA) 

requesting that the Commission provide 

clarification on the Commission’s 

jurisdiction over investors holding 

between 10% and 20% of a public 

utility’s outstanding voting securities 

who are eligible to file a statement of 

beneficial ownership with the Securities 

and Exchange Commission.20 In that 

proceeding, the Commission issued a 

Notice of Proposed Rulemaking (NOPR) 

proposing to create a FERC form 

wherein holding companies would 

affirm that an investor did not control 

a public utility when the investor 

refrained from engaging in certain 

actions.21 Entities signing the form 

would have been eligible for a blanket 

authorization for the acquisition of up to 

20% of the outstanding voting securities 

of a public utility or holding company 

thereof. Comments on the NOPR 

generally fell into two groups. The first 

group believed that the Commission’s 

proposal was too restrictive and that an 

investor would be unwilling to commit 

to the restrictions on the proposed FERC 

form, such that the Commission’s 

proposal did not provide the original 

relief requested by EPSA; the second 

group believed the Commission could 

be opening up wholesale energy markets 

to anticompetitive behavior through 

partial acquisitions of the securities of 

multiple public utilities without 

adequate oversight. The Commission 

ultimately decided that, having 

considered these comments, it was 

persuaded to not seek to adopt the 

proposed reforms, and withdrew the 

NOPR and terminated the rulemaking 

proceeding.22

8. Since the Commission revised its

regulations to expand blanket 

authorizations under section 203(a)(2) 

and began granting case-specific blanket 

authorizations for holding companies, 

including investment companies, there 

have been changes in the public utility, 

finance, and banking industries that 

warrant consideration of whether the 

Commission’s blanket authorization 

policy continues to work as intended. 

These changes include consolidation in 

the public utility industry as well as the 

growth of large index funds and asset 

managers. Factors such as the repeal of 

PUHCA 1935 and increased interest in 

U.S. utility assets by foreign companies/ 

investors and private equity investors 

have led to the greater consolidation of 

utility holding companies, as shown by 

utility merger activity of approximately 

$200 billion from 2012 to 2018.23 At the 

beginning of 2010, there was 

approximately $2.3 trillion invested in 

index funds, which grew to $11.4 

trillion by the end of 2019.24 Index 

funds are estimated to have grown from 

20% of the fund market in 2011 to 43% 

by the end of 2021.25 Both commenters 

and FERC Commissioners have noted 

that this change in the manner in which 

assets are owned and controlled 

warrants the Commission’s careful 

consideration to make sure that its 

blanket authorization policy is 

consistent with the public interest.26

II. Discussion

9. We are issuing this NOI to further

explore whether, and if so, how, the 

Commission should revise its policy on 

blanket authorizations for holding 

companies, including investment 

companies, under section 203(a)(2) of 

the FPA. We invite all interested 

persons to submit comments and reply 

comments on any or all of the questions 

listed below. Commenters need not 

answer all the questions. 

A. Blanket Authorization Policy

10. As noted above, the Commission

has granted company-specific blanket 

authorizations under section 203(a)(2) 

for holding companies, including 

investment companies’ managed funds, 

to acquire the voting securities of public 

utilities and holding companies thereof, 

in addition to the blanket authorizations 

granted by the Commission in its 

regulations. We seek comment on 


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27See, e.g., Black Hills Colo. Elec., LLC, 184 FERC 

¶ 61,172, at P 19 (2023) (‘‘Black Hills MBR Sellers 

state that State Street represented to them that State 

Street qualifies under section 33.1(c)(9) of the 

Commission’s regulations for blanket authorization 

under section 203(a)(2) of the FPA to acquire and 

hold an unlimited amount of securities of holding 

companies that include a transmitting utility or an 

electric utility company.’’) (citation omitted); see 

also id. (Danly, Comm’r, concurring at P 3) (‘‘It is 

not clear to me whether State Street satisfies the 

requirements above and nothing in Black Hills MBR 

Sellers’ filing demonstrates which, if any, of the 

elements of our regulation State Street satisfies.’’). 

28See Nathan Atkinson, If Not the Index Funds, 

Then Who?, 17 BERKELEY BUS. L.J. 44, 45 (2020) 

(‘‘In recent years, large asset managers have reached 

incredible sizes, managing trillions of dollars of 

assets on behalf of tens of millions of clients. The 

largest three, BlackRock, Vanguard, and State 

Street, taken together (the ‘Big Three’), vote about 

20% of shares in most large companies, with the 

majority of these shares held in passive index 

funds.’’) (citation omitted); Lucian Bebchuk & Scott 

Hirst, The Specter of the Giant Three, 99 B.U. L. 

REV. 721, 724 (2019). 

29See Public Citizen, Inc., Protest, Docket No. 

EC16–77–002, at 1 (filed Mar. 11, 2022) (‘‘Not only 

is it impossible for a fund manager of BlackRock’s 

size and scope to remain a passive investor, 

scholarly research demonstrates that BlackRock’s 

accumulation of voting securities constitutes 

control over utilities, and its horizontal power over 

competing utilities harms competition.’’).; see also 

Einer Elhauge, Horizontal Shareholding, 129 

HARV. L. REV. 1267, 1267 (2016) (‘‘A small group 

of institutions has acquired large shareholdings in 

horizontal competitors throughout our economy, 

causing them to compete less vigorously with each 

other.’’). 

30See Consumers’ Research, Inc., Motion to 

Intervene and Protest, Docket No. EC19–57–002, at 

4–5 (filed Nov. 28, 2022) (arguing that the three 

largest index funds have ‘‘have embarked on a fullscale engagement and proxy-voting strategy to force 

utility companies to comply with various 

decarbonization goals’’); see also Eric C. Chaffee, 

Index Funds & ESG Hypocrisy, 71 CASE W. RES. 

L. REV. 1295, 1298–1299 (2021) (noting statements 

by index fund managers related to climate and 

sustainability goals). 

current Commission policy as well as 

whether, and if so, how, the 

Commission should revise its policy. 

(Q1) Please describe whether the 

Commission’s current blanket 

authorization policy, as set forth in the 

Commission’s regulations or on a casespecific basis, is sufficient to ensure that 

holding companies, including 

investment companies, lack the ability 

to control the public utilities and 

holding companies whose securities 

they acquire and that the transactions 

underlying the blanket authorization are 

consistent with the public interest. 

(Q2) If the Commission’s current 

policy is insufficient, how should the 

Commission revise its case-specific 

blanket authorizations for holding 

companies, including investment 

companies, to acquire voting securities? 

How should the Commission revise its 

regulations providing certain blanket 

authorizations under section 203(a)(2)? 

(Q3) Are the existing conditions and 

restrictions associated with case-specific 

blanket authorizations, such as the 

submission of Securities and Exchange 

Commission (SEC) Schedule 13D and 

13G filings, effective in ensuring that 

holding companies, including 

investment companies, lack control over 

public utilities, and holding companies 

thereof, such that the Commission can 

be assured that the transactions 

underlying the blanket authorization are 

consistent with the public interest? 

(Q4) Does the current scope or 

availability of blanket authorizations for 

the acquisition of voting securities by 

holding companies, including 

investment companies, create concerns 

regarding an adverse effect on 

competition or jurisdictional rates? 

(Q5) If there are concerns with the 

current policy regarding grants of 

blanket authorizations to holding 

companies, including investment 

companies, are there specific 

commitments or other conditions from 

holding companies, including 

investment companies, that could give 

the Commission assurance that such 

blanket authorizations are consistent 

with the public interest? 

(Q6) The blanket authorization in 18 

CFR 33.1(c)(9)(iv) requires that a 

holding company file—when securities 

are held ‘‘[s]olely for purposes of 

liquidation and in connection with a 

loan previously contracted for and 

owned beneficially for a period of not 

more than two years,’’—on a public 

basis and within 45 days of the close of 

each calendar quarter, both its total 

holdings and its holdings as principal, 

each by class, unless the holdings 

within a class are less than one percent 

of outstanding shares, irrespective of the 

capacity in which they were held. 

Specifically, there have been cases 

where it was unclear, based on the 

record, whether an entity has satisfied 

the requirements for blanket 

authorization under 18 CFR 33.1(c)(9).27

Should the Commission require a 

holding company, or a subsidiary of that 

company, that qualifies for FPA section 

203 blanket authorization under 18 CFR 

33.1(c)(9) to report on what basis it 

qualifies (i.e., ‘‘(i) [a]s a fiduciary; (ii) 

[a]s principal for derivatives hedging 

purposes incidental to the business of 

banking and it commits not to vote such 

securities to the extent they exceed 10 

percent of the outstanding shares; (iii) 

[a]s collateral for a loan; or (iv) [s]olely 

for purposes of liquidation and in 

connection with a loan previously 

contracted for and owned beneficially 

for a period of not more than two years 

. . . .’’)? Are there any other measures 

that the Commission should take to 

oversee compliance with the terms of 

these blanket authorizations? 

(Q7) The case-specific blanket 

authorizations granted by the 

Commission to investment companies 

generally require informational filings of 

holdings, similar to that required of the 

blanket authorization in 18 CFR 

33.1(c)(9)(iv). Are these informational 

filings sufficient for the Commission to 

maintain an appropriate level of 

oversight for compliance with the terms 

of blanket authorizations? Are there any 

other measures that the Commission 

should take to oversee compliance with 

the terms of these blanket 

authorizations? 

B. Large Investment Companies 

11. The three largest index fund 

investment companies currently vote 

over 20% of the stock in the largest U.S. 

public companies, a number that may 

soon rise to 40%.28 Some have argued 

that the size of these investment 

companies creates issues related to 

competition and gives the investment 

companies unique leverage over the 

utilities whose voting securities they 

control.29 Additionally, some have 

argued that the largest index funds have 

used their ownership stakes to pressure 

utilities to meet particular public policy 

goals, despite committing to not 

exercise control over the utilities.30 We 

seek comment on whether, and if so, 

how, the Commission should consider 

the size of an investment company in 

evaluating a request for blanket 

authorization under section 203(a)(2). 

(Q8) How can the Commission 

effectively evaluate the influence and 

control exerted by holding companies, 

including investment companies, 

regardless of their size, over public 

utilities when considering blanket 

authorizations under section 203(a)(2)? 

What factors should be prioritized to 

ensure a fair and comprehensive 

assessment while maintaining a 

straightforward and equitable process 

for all holding companies, including 

investment companies? 

(Q9) Please describe whether and how 

the Commission should consider 

holding companies’, including 

investment companies’, pre-existing 

ownership and control of public utilities 

and holding companies thereof in 

determining whether to grant blanket 

authorizations under section 203(a)(2). 

(Q10) How should the Commission 

distinguish between various types of 

investment vehicles for purposes of 

section 203(a)(2) blanket authorizations? 

(Q11) What are the impacts on the 

public interest, both positive and 

negative, of holding companies, 

including investment companies, 

holding voting securities in multiple 


ddrumheller on DSK120RN23PROD with PROPOSALS1
89350 Federal Register / Vol. 88, No. 247 / Wednesday, December 27, 2023 / Proposed Rules 

31See, e.g., BlackRock, Inc., 131 FERC ¶ 61,063 at 

P 17. 

32See Senator Michael S. Lee et al., Letter to 

Commission, Docket No. EC16–77–002 at 5 (filed 

June 28, 2023) (‘‘Many of [BlackRock’s] significant 

attempts to influence control, however, have likely 

been behind closed doors, in the form of ‘investor 

engagement’ with the backdrop of [Climate Action 

100+] and [the Net Zero Asset Managers Initiative]’s 

coordinated activities and massive collective voting 

power.’’). 1See, e.g., Va. Code Ann. § 56.1 et seq. 

public utilities and Commissionregulated entities? 

(Q12) What other ways may up to 

20% ownership or control of multiple 

public utilities and holding companies 

thereof by holding companies, including 

investment companies, affect the public 

interest that the Commission should 

consider? 

C. Evaluation of Control Under Section 

203 of the FPA 

12. Often, when seeking a blanket 

authorization under section 203(a)(2), 

an investment company will argue that 

its investments in public utilities do not 

allow for it to control the public utility, 

including control over the day-to-day 

management and operations of the 

utility, or holding company thereof.31

However, it has been argued that by 

holding voting securities in a large 

number of public utilities, investment 

companies are able to influence utility 

behavior in ways that are not captured 

by the Commission’s current analysis of 

control.32 We seek comment on what 

factors the Commission should consider 

when evaluating control over public 

utilities as part of a request for blanket 

authorization. 

(Q13) In what way may a holding 

company, including an investment 

company, exert control over public 

utilities that is not currently captured by 

the Commission’s current policies and 

regulations? 

(Q14) What strategies or actions taken 

by holding companies, including 

investment companies, or the actions of 

a public utility that is the subject of a 

blanket authorization could demonstrate 

control or a degree of influence that 

would require prior Commission review 

under section 203(a)(2)? In other words, 

what are the indicia of control that the 

Commission could look to when 

assessing whether a holding company 

can exercise control? 

(Q15) Does holding the voting 

securities, notwithstanding 

commitments not to exercise control, of 

multiple public utilities provide a form 

of control or influence that is not 

addressed by the Commission’s current 

polices and regulations? If so, how? And 

how should the Commission resolve 

this form of control or influence? 

(Q16) Should the Commission 

consider the impact of investment 

companies holding public utility voting 

securities on long-term planning by 

public utilities or other issues beyond 

day-to-day control over utility 

operations? If so, how? 

(Q17) What corporate governance 

factors should the Commission consider 

when evaluating whether investment 

companies can exercise control over 

public utilities? For instance, should the 

Commission consider the ability of an 

investment company to influence board 

membership of a public utility and, if 

so, how? 

III. Comment Procedures 

13. The Commission invites interested 

persons to submit comments on the 

matters and issues identified in this 

notice. Initial comments are due March 

26, 2024 and reply comments are due 

April 25, 2024. Comments must refer to 

Docket No. AD24–6–000, and must 

include the commenter’s name, the 

organization they represent, if 

applicable, and their address in their 

comments. All comments will be placed 

in the Commission’s public files and 

may be viewed, printed, or downloaded 

remotely as described in the Document 

Availability section below. Commenters 

on this proposal are not required to 

serve copies of their comments on other 

commenters. 

14. The Commission encourages 

comments to be filed electronically via 

the eFiling link on the Commission’s 

website at http://www.ferc.gov. The 

Commission accepts most standard 

word processing formats. Documents 

created electronically using word 

processing software must be filed in 

native applications or print-to-PDF 

format and not in a scanned format. 

Commenters filing electronically do not 

need to make a paper filing. 

15. Commenters that are not able to 

file comments electronically may file an 

original of their comment by USPS mail 

or by courier-or other delivery services. 

For submission sent via USPS only, 

filings should be mailed to: Federal 

Energy Regulatory Commission, Office 

of the Secretary, 888 First Street NE, 

Washington, DC 20426. Submission of 

filings other than by USPS should be 

delivered to: Federal Energy Regulatory 

Commission, 12225 Wilkins Avenue, 

Rockville, MD 20852. 

IV. Document Availability 

16. In addition to publishing the full 

text of this document in the Federal 

Register, the Commission provides all 

interested persons an opportunity to 

view and/or print the contents of this 

document via the internet through the 

Commission’s Home Page (http://

www.ferc.gov). 

17. From the Commission’s Home 

Page on the internet, this information is 

available on eLibrary. The full text of 

this document is available on eLibrary 

in PDF and Microsoft Word format for 

viewing, printing, and/or downloading. 

To access this document in eLibrary, 

type the docket number excluding the 

last three digits of this document in the 

docket number field. 

18. User assistance is available for 

eLibrary and the Commission’s website 

during normal business hours from the 

Commission’s Online Support at 202– 

502–6652 (toll free at 1–866–208–3676) 

or email at ferconlinesupport@ferc.gov. 

By direction of the Commission. 

Commissioner Christie is concurring 

with a separate statement attached. 

Issued: December 19, 2023. 

Debbie-Anne A. Reese, 

Deputy Secretary. 

United States of America 

Federal Energy Regulatory Commission 

Federal Power Act Section 203 Blanket 

Authorizations for Investment 

Companies 

Docket No. AD24–6–000 

(Issued December 19, 2023) 

CHRISTIE, Commissioner, concurring: 

1. Public utilities, sometimes called 

‘‘public service corporations’’ or ‘‘public 

service companies’’ under various state 

laws,1 are not garden-variety, for-profit, 

shareholder-owned companies. In 

particular, public utilities that provide 

electrical power to retail customers are 

usually holders of a state-granted 

monopoly franchise that comes with 

various public service obligations, such 

as providing reliable power service at 

rates that are just and reasonable. So 

whether a public utility is owned by 

investors directly or through a holding 

company structure, it is absolutely 

essential for regulators to make sure that 

the interests of investors do not conflict 

with the public service obligations that 

a utility has. And yes, there is a 

potential conflict. That potential 

conflict requires heightened regulatory 

scrutiny when huge investment 

companies and asset managers, as well 

as large private equity funds, which 

individually and collectively direct 

literally trillions of dollars in capital, 

appear to be acting not as passive 

investors simply seeking the best riskbased returns for their own clients, but 

instead appear to be actively using their 

investment power to affect how the 


ddrumheller on DSK120RN23PROD with PROPOSALS1
Federal Register / Vol. 88, No. 247 / Wednesday, December 27, 2023 / Proposed Rules 89351 

2BlackRock, Inc., 179 FERC ¶ 61,049 (2022) 

(Christie, Comm’r, concurring at P 3) (BlackRock 

Concurrence), available at https://www.ferc.gov/ 

news-events/news/commissioner-christiesconcurrence-blackrocks-authorization-buy-votingsecurities. 

3 You can see the extent of these investment 

managers’ holdings through the quarterly reports 

the Commission receives as part of the requirements 

associated with section 203(a)(2) blanket 

authorizations. See, e.g., BlackRock, Quarterly 

Report, Docket No. EC16–77–002 (filed Nov. 15, 

2023) (detailing holdings in several publicly traded 

holding companies with public utility subsidiaries). 

4See BlackRock Concurrence at PP 4–5. 

5See, e.g., Testimony of Commissioner Mark C. 

Christie, Oversight of FERC: Adhering to a Mission 

of Affordable and Reliable Energy for America, 

United States House of Representatives (June 12, 

2023), available at https://www.ferc.gov/media/ 

testimony-commissioner-mark-c-christie-oversightferc-adhering-mission-affordable-and; Written 

Testimony of Commissioner Mark Christie Before 

the Committee on Energy and Natural Resources, 

United States Senate (Sept. 27, 2021), available at 

https://cms.ferc.gov/media/written-testimonycommissioner-mark-christie-committee-energy-andnatural-resources-united. 

6See, e.g., Transactions Subject to FPA Section 

203, Order No. 669, 113 FERC ¶ 61,315 (2005), 

order on reh’g, Order No. 669–A, 115 FERC 

¶ 61,097, order on reh’g, Order No. 669–B, 116 

FERC ¶ 61,076 (2006). 

utility meets its own public service 

obligations. That is why this proceeding 

is so essential, to explore those issues 

and determine whether the 

Commission’s own regulations and 

regulatory practices are still sufficient to 

protect the interests of the customers of 

public utility companies which, again, 

are likely to be monopoly providers of 

a vital public service such as electrical 

power. 

2. As I mentioned in my concurrence

to an earlier order extending BlackRock, 

Inc.’s (BlackRock) blanket authorization 

under section 203 of the Federal Power 

Act (FPA),2 it simply is no longer a 

credible assertion that investment 

managers, like BlackRock, State Street 

Corporation, and The Vanguard Group, 

Inc., are always or should be assumed 

to be merely passive investors. These 

investment managers are often the three 

biggest investors in publicly traded 

companies across the U.S. economy, 

including the utility industry, and wield 

significant financial power by virtue of 

their investments.3 These investment 

managers may occasionally use that 

financial power to push various types of 

policy agendas, agendas that may 

ultimately conflict with the utility’s 

public service obligations to its 

customers.4 Or, totally different from 

any policy goal, the threat may come 

from a private equity investor’s attempt 

to turn a quick profit on a short-term 

trade by undercutting utility practices 

that are designed to serve its retail 

customers over the long term, not the 

short-term interests of the private equity 

investor. 

3. One focus recently, and rightfully

so, has been on ‘‘ESG’’ (environmental, 

social, and governance-related) 

corporate initiatives, with huge asset 

managers pushing policy decisions that 

should be left to elected legislators. For 

example, I have pointed out the 

reliability problems that will result from 

premature dispatchable generation 

retirements that may come from these 

initiatives.5 Decisions on the 

appropriate generation resources mix for 

a public utility with a state-granted 

franchise are policy decisions for state 

policymakers, not huge Wall Street asset 

managers. 

4. But let us be clear—‘‘ESG’’ investor

activity is simply a symptom of a larger, 

more pernicious threat that has always 

existed in the utility industry: improper 

investor influence and control over 

public utilities. Large investors can and 

do force utilities to make decisions that 

are contrary to their public service 

obligations to their retail customers. 

This, among other related concerns, is 

exactly why Congress enacted a suite of 

consumer protection statutes, including 

the FPA almost 100 years ago. 

Congress’s subsequent revisions to the 

FPA over the years, such as by the 

Energy Policy Act of 2005, signal the 

ongoing importance of consumer 

protection in the Commission’s 

regulatory responsibilities, including 

under section 203. Congress may have 

directed the Commission to streamline 

its regulations to facilitate greater 

investments in the utility industry, such 

as through section 203 blanket 

authorizations,6 but that streamlining 

does not, and should never, come at 

expense of protecting consumers. 

Indeed, it is the Commission’s task to 

balance these two competing 

responsibilities and to continue to 

revisit and evaluate that balance. So I 

fully agree that this NOI is timely and 

compelling and I look forward to 

moving forward on it. 

For these reasons, I respectfully 

concur. 

Mark C. Christie, 

Commissioner. 

[FR Doc. 2023–28665 Filed 12–22–23; 2:00 pm] 

BILLING CODE 6717–01–P 

ENVIRONMENTAL PROTECTION 

AGENCY 

40 CFR Part 52 

[EPA–R09–OAR–2023–0590; FRL–11615– 

01–R9] 

Air Plan Approval; California; YoloSolano Air Quality Management 

District 

AGENCY: Environmental Protection 

Agency (EPA). 

ACTION: Proposed rule. 

SUMMARY: The Environmental Protection 

Agency (EPA) is proposing to approve, 

through parallel processing, state 

implementation plan (SIP) revisions 

from the Yolo-Solano Air Quality 

Management District (YSAQMD or 

‘‘District’’) to address Clean Air Act 

(CAA or ‘‘Act’’) requirements related to 

the 2008 8-hour ozone national ambient 

air quality standards (NAAQS or 

‘‘standards’’). These revisions concern 

emissions of oxides of nitrogen (NOX) 

from biomass boilers, and also address 

reasonably available control technology 

(RACT) requirements for major sources 

of NOX in the portion of the Sacramento 

Metro, CA, nonattainment area that is 

subject to YSAQMD jurisdiction. We are 

taking comments on this proposal and 

plan to follow with a final action. 

DATES: Comments must be received on 

or before January 26, 2024. 

ADDRESSES: Submit your comments, 

identified by Docket ID No. EPA–R09– 

OAR–2023–0590 at https:// 

www.regulations.gov. For comments 

submitted at Regulations.gov, follow the 

online instructions for submitting 

comments. Once submitted, comments 

cannot be edited or removed from 

Regulations.gov. The EPA may publish 

any comment received to its public 

docket. Do not submit electronically any 

information you consider to be 

Confidential Business Information (CBI) 

or other information whose disclosure is 

restricted by statute. Multimedia 

submissions (audio, video, etc.) must be 

accompanied by a written comment. 

The written comment is considered the 

official comment and should include 

discussion of all points you wish to 

make. The EPA will generally not 

consider comments or comment 

contents located outside of the primary 

submission (i.e., on the web, cloud, or 

other file sharing system). For 

additional submission methods, please 

contact the person identified in the FOR

FURTHER INFORMATION CONTACT section. 

For the full EPA public comment policy, 

information about CBI or multimedia 

submissions, and general guidance on 

making effective comments, please visit 


ddrumheller on DSK120RN23PROD with PROPOSALS1