17654 Federal Register / Vol. 80, No. 62 / Wednesday, April 1, 2015 / Rules and Regulations 

DEPARTMENT OF ENERGY 

Federal Energy Regulatory 

Commission 

18 CFR Part 35 

[RM14–11–000; Order No. 807] 

Open Access and Priority Rights on 

Interconnection Customer’s 

Interconnection Facilities 

AGENCY: Federal Energy Regulatory 

Commission. 

ACTION: Final rule. 

SUMMARY: In this Final Rule, the Federal 

Energy Regulatory Commission is 

amending its regulations to waive the 

Open Access Transmission Tariff 

requirements, the Open Access SameTime Information System requirements, 

and the Standards of Conduct 

requirements, under certain conditions, 

for the ownership, control, or operation 

of Interconnection Customer’s 

Interconnection Facilities (ICIF). This 

Final Rule finds that those seeking 

interconnection and transmission 

service over ICIF that are subject to the 

blanket waiver adopted herein may 

follow procedures applicable to requests 

for interconnection and transmission 

service under sections 210, 211, and 212 

of the FPA, which also allows the 

contractual flexibility for entities to 

reach mutually agreeable access 

solutions. This Final Rule establishes a 

modified rebuttable presumption for a 

five-year safe harbor period to reduce 

risks to ICIF owners eligible for the 

blanket waiver during the critical early 

years of their projects. Finally, this Final 

Rule modifies, as described in detail 

below, several elements of the Notice of 

Proposed Rulemaking, including the 

entities eligible for the OATT waiver, 

the date on which the safe harbor 

begins, the rebuttable presumption that 

the ICIF owner should not be required 

to expand its facilities during the safe 

harbor, and the facilities covered by the 

Final Rule. 

DATES: This rule will become effective 

June 30, 2015. 

FOR FURTHER INFORMATION CONTACT: 

Becky Robinson (Technical 

Information), Office of Energy Policy 

and Innovation, Federal Energy 

Regulatory Commission, 888 First 

Street NE., Washington, DC 20426, 

(202) 502–8868, 

Becky.Robinson@ferc.gov. 

Brian Gish (Legal Information), Office of 

the General Counsel—Energy Markets, 

Federal Energy Regulatory 

Commission, 888 First Street NE., 

Washington, DC 20426, (202) 502– 

8998, Brian.Gish@ferc.gov. 

SUPPLEMENTARY INFORMATION: 

ORDER NO. 807 

FINAL RULE

Paragraph Nos. 

I. Introduction ........................................................................................................................................................................... 1 

II. Background ........................................................................................................................................................................... 6 

A. Development of ICIF Policies ...................................................................................................................................... 6 

III. Need for Reform .................................................................................................................................................................. 18 

A. Commission Proposal ................................................................................................................................................... 18 

B. Comments ...................................................................................................................................................................... 19 

C. Commission Determination .......................................................................................................................................... 33 

IV. Proposed Reforms ............................................................................................................................................................... 41 

A. Eligible ICIF .................................................................................................................................................................. 41 

1. Commission Proposal ............................................................................................................................................ 41 

2. Comments ............................................................................................................................................................... 42 

3. Commission Determination ................................................................................................................................... 43 

B. Grant Blanket Waivers to Eligible ICIF Owners ......................................................................................................... 44 

1. Blanket Waivers ..................................................................................................................................................... 44 

2. Requirement That ICIF Owners Must Sell Electricity To Qualify for the Waiver ............................................. 59 

3. Status of the Third-Party Requester ...................................................................................................................... 76 

4. Non-Public Utilities ............................................................................................................................................... 79 

5. Applicability to Industrial Power Systems’ Tie Lines ......................................................................................... 83 

6. Applicability of the Blanket Waiver to Additional Regulations ......................................................................... 85 

7. Existing Agreements and Waivers ........................................................................................................................ 88 

8. Existing OATTs ...................................................................................................................................................... 90 

9. Revoking the Blanket Waiver ................................................................................................................................ 94 

C. Interconnection and Transmission Under Sections 210 and 211 of the Federal Power Act ................................... 104 

1. Sections 210 and 211 ............................................................................................................................................. 104 

2. Voluntary Arrangements ........................................................................................................................................ 115 

3. Interaction With the Transmission System .......................................................................................................... 119 

4. Scope of Regulations To Be Modified .................................................................................................................. 128 

5. Reliability Standards .............................................................................................................................................. 131 

D. Safe Harbor ................................................................................................................................................................... 133 

1. Whether and To What Extent There Should Be a Safe Harbor Period .............................................................. 133 

2. Starting Point for the Safe Harbor Period ............................................................................................................. 141 

3. Length of the Safe Harbor Period .......................................................................................................................... 147 

E. Affiliate Concerns ......................................................................................................................................................... 153 

1. Commission Proposal ............................................................................................................................................ 153 

2. Comments ............................................................................................................................................................... 154 

3. Commission Determination ................................................................................................................................... 165 

F. Miscellaneous ................................................................................................................................................................ 170 

1. Treatment of Line Losses on ICIF ......................................................................................................................... 170 

2. Applicability of the Commission’s ‘‘Prior Notice’’ Policy .................................................................................. 172 

3. Technical Aspects of Interconnection .................................................................................................................. 174 

4. Implementation ...................................................................................................................................................... 176 

V. Information Collection Statement ....................................................................................................................................... 177 

VI.8 Regulatory Flexibility Act Analysis ................................................................................................................................ 184 

VII. Document Availability ...................................................................................................................................................... 185 

VIII. Effective Date and Congressional Notification ............................................................................................................... 188 

Regulatory Text 

Appendix A: List of Short Names of Commenters on the Notice of Proposed Rulemaking 

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Federal Register / Vol. 80, No. 62 / Wednesday, April 1, 2015 / Rules and Regulations 17655 

1The jurisdictional interconnection facilities for 

which this Final Rule grants a waiver have 

sometimes in the past been referred to informally 

as ‘‘generator tie lines,’’ but, in the Notice of 

Proposed Rulemaking, the Commission used the 

term ICIF as defined in the pro forma documents 

issued with Order No. 2003. As discussed below, 

infra section IV.A Eligible ICIF, we continue to use 

the term ‘‘ICIF’’ throughout this Final Rule but 

clarify there that we intend the term to encompass 

a broader scope. Standardization of Generator 

Interconnection Agreements and Procedures, Order 

No. 2003, 68 FR 49845 (Aug. 19, 2003), FERC Stats. 

& Regs. ¶31,146, at Appendix C, Appendix 6, 

Article 1 (2003), order on reh’g, Order No. 2003– 

A, 69 FR 15932 (Mar. 26, 2004), FERC Stats. & Regs. 

¶ 31,160, order on reh’g, Order No. 2003–B, 70 FR 

265 (Jan. 4, 2005), FERC Stats. & Regs. ¶ 31,171 

(2004), order on reh’g, Order No. 2003–C, 70 FR 

37661 (Jun. 30, 2005), FERC Stats. & Regs. ¶ 31,190 

(2005), aff’d sub nom. Nat’l Ass’n of Regulatory 

Util. Comm’rs v. FERC, 475 F.3d 1277 (D.C. Cir. 

2007), cert denied, 552 U.S. 1230 (2008). 

2 16 U.S.C. 824i, 824j, and 824k. 

3 In this Final Rule, the term ‘‘ICIF owners’’ 

includes those who operate or control ICIF. 

4Open Access and Priority Rights on 

Interconnection Customer’s Interconnection 

Facilities, Notice of Proposed Rulemaking, 79 FR 

31061 (May 30, 2014), FERC Stats. & Regs. ¶ 32,701 

(2014), corrected, 79 FR 35501 (June 23, 2014). 

5As discussed infra, the blanket waiver will 

apply only to entities that are either directly subject 

to section 210 or have voluntarily committed to 

comply with section 210. 

6 16 U.S.C. 824(b). 

7 16 U.S.C. 824(e). Section 201(f) of the FPA 

exempts certain governmental entities and electric 

cooperatives from being a public utility. 

8 16 U.S.C. 824d and 824e. 

9Promoting Wholesale Competition Through 

Open Access Non-Discriminatory Transmission 

Services by Public Utilities; Recovery of Stranded 

Costs by Public Utilities and Transmitting Utilities, 

Order No. 888, 61 FR 21540 (May 10, 1996), FERC 

Stats. & Regs. ¶ 31,036 (1996), order on reh’g, Order 

No. 888–A, 62 FR 12274 (Mar. 14, 1997), FERC 

Stats. & Regs. ¶ 31,048, order on reh’g, Order No. 

888–B, 81 FERC ¶ 61,248 (1997), order on reh’g, 

Order No. 888–C, 82 FERC ¶ 61,046 (1998), aff’d in 

relevant part sub nom. Transmission Access Policy 

Study Group v. FERC, 225 F.3d 667 (D.C. Cir. 2000), 

aff’d sub nom. New York v. FERC, 535 U.S. 1 

(2002). 

I. Introduction 

1. In this Final Rule, the Federal 

Energy Regulatory Commission (FERC 

or Commission) is amending its 

regulations to waive the Open Access 

Transmission Tariff (OATT) 

requirements of 18 CFR 35.28, the Open 

Access Same-Time Information System 

(OASIS) requirements of 18 CFR 37, and 

the Standards of Conduct requirements 

18 CFR 358, under certain conditions, 

for the ownership, control, or operation 

of Interconnection Customer’s 

Interconnection Facilities (ICIF).1 This 

Final Rule finds that those seeking 

interconnection and transmission 

service over ICIF that are subject to the 

blanket waiver adopted herein may 

follow procedures applicable to requests 

for interconnection and transmission 

service under sections 210, 211, and 212 

of the Federal Power Act (FPA), which 

also allows the contractual flexibility for 

entities to reach mutually agreeable 

access solutions.2 This Final Rule 

establishes a modified rebuttable 

presumption for a five-year safe harbor 

period to reduce risks to ICIF owners 3

eligible for the blanket waiver during 

the critical early years of their projects. 

Finally, this Final Rule modifies, as 

described in detail below, several 

elements of the Notice of Proposed 

Rulemaking (NOPR), including the 

entities eligible for the OATT waiver, 

the date on which the safe harbor 

begins, the rebuttable presumption that 

the ICIF owner should not be required 

to expand its facilities during the safe 

harbor, and the facilities covered by the 

Final Rule.4

2. We find that requiring the filing of 

an OATT is not necessary to prevent 

unjust or unreasonable rates or unduly 

discriminatory behavior with respect to 

ICIF, over which interconnection and 

transmission services can be ordered 

pursuant to sections 210, 211, and 212 

of the FPA.5 Further, we conclude that 

the Commission’s policies requiring the 

ICIF owner to make excess capacity 

available to third parties unless it can 

justify its planned use of the line 

impose risks and burdens on ICIF 

owners and create regulatory 

inefficiencies that are not necessary 

given the goals that the Commission 

seeks to achieve through such policies. 

Based on comments received as part of 

our consideration of the treatment of 

ICIF, we understand that generation 

developers may develop new projects in 

phases and build interconnection 

facilities large enough to accommodate 

the development of all planned phases. 

The Commission’s existing policy has 

led ICIF owners to file petitions for 

declaratory orders demonstrating plans 

and milestones for future generation 

development to reserve for themselves 

currently excess ICIF capacity that they 

built for such purposes. In the vast 

majority of cases, the Commission has 

granted the petition, based on 

confidential documentation filed by the 

ICIF owner, with a limited description 

of the plans and milestones the 

Commission deemed dispositive. 

Further, the Commission’s existing 

policy of treating ICIF the same as other 

transmission facilities for OATT 

purposes, including the requirement to 

file an OATT following a third-party 

request, creates undue burden for ICIF 

owners without a corresponding 

enhancement of access given the ICIF 

owner’s typical ability to establish 

priority rights. 

3. Granting an OATT waiver to ICIF 

owners and providing that third-party 

access be governed by sections 210, 211, 

and 212 will enable ICIF owners and 

third parties, where possible, to reach 

mutually agreeable and voluntary 

arrangements that provide ICIF access to 

third parties, while protecting a third 

party’s right to request that the 

Commission order interconnection and 

transmission service over ICIF. We find 

that providing this contractual 

flexibility may remove barriers to an 

ICIF owner’s willingness to enter into 

such an agreement with a third party. 

4. We recognize that ICIF owners 

often construct ICIF to accommodate 

multiple generation project phases and 

intend for their subsequent generation 

projects to use what is initially excess 

capacity on the ICIF. We believe that the 

safe harbor period established by this 

Final Rule will enable these ICIF owners 

to focus in the early stages of 

development on building generation. 

5. We find that the reforms adopted 

herein re-balance the burden on ICIF 

owners and encourage efficient 

generation and interconnection facility 

development, while maintaining access 

to available capacity for third parties 

where appropriate. 

II. Background 

A. Development of ICIF Policies 

6. Under section 201(b) of the FPA, 

the Commission has jurisdiction over all 

facilities used for the transmission of 

electric energy in interstate commerce.6

Under section 201(e) of the FPA, any 

person who owns or operates facilities 

subject to the jurisdiction of the 

Commission is a public utility.7 The 

Commission is charged with the 

responsibility under sections 205 and 

206 of the FPA to ensure that a public 

utility’s rates, charges, and 

classifications of service are just and 

reasonable and not unduly 

discriminatory or preferential.8

7. In Order No. 888, the Commission, 

relying upon its authority under 

sections 205 and 206 of the FPA, 

established non-discriminatory open 

access to electric transmission service as 

the foundation necessary to develop 

competitive bulk power markets in the 

United States.9 Order No. 888, codified 

in section 35.28 of the Commission’s 

regulations, requires that any public 

utility that owns, controls, or operates 

facilities used for the transmission of 

electric energy in interstate commerce 

must file an OATT and comply with 

other related requirements. The 

Commission in Order No. 888 did not 

specifically address transmission 

facilities associated with the 

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17656 Federal Register / Vol. 80, No. 62 / Wednesday, April 1, 2015 / Rules and Regulations 

10Open Access Same-Time Information System 

and Standards of Conduct, Order No. 889, 61 FR 

21737 (May 10, 1996), FERC Stats. & Regs. ¶ 31,035 

(1996), order on reh’g, Order No. 889–A, FERC 

Stats. & Regs. ¶ 31,049 (1997), reh’g denied, Order 

No. 889–B, 81 FERC ¶ 61,253 (1997). 

11Although originally promulgated by Order No. 

889, the Commission has since relocated the 

Standards of Conduct to Part 358 and adopted a 

number of changes, most recently revised by Order 

No. 717. Standards of Conduct for Transmission 

Providers, Order No. 717, FERC Stats. & Regs. 

¶ 31,280 (2008). 

12Order No. 2003, FERC Stats. & Regs. ¶ 31,146 

at P 11. 

13 Id. PP 12, 20. 

14As discussed above, throughout this Final Rule, 

the terms LGIP and LGIA refer to the pro forma 

versions of those documents. 

15Order No. 2003 established rules for a Large 

Generating Facility, defined as a generating facility 

with a capacity of more than 20 MW. Similarly, in 

Order No. 2006, the Commission established the 

pro forma Small Generator Interconnection 

Procedures and the pro forma Small Generator 

Interconnection Agreement for interconnecting 

small generators (no larger than 20 MW). 

Standardization of Small Generator Interconnection 

Agreements and Procedures, Order No. 2006, FERC 

Stats. & Regs. ¶ 31,180, order on reh’g, Order No. 

2006–A, FERC Stats. & Regs. ¶ 31,196 (2005), order 

granting clarification, Order No. 2006–B, FERC 

Stats. & Regs. ¶ 31,221 (2006). 

16LGIA Article 1. Section 1 of the LGIP includes 

identical definitions to those in Article 1 of the 

LGIA. 

17Unless otherwise indicated, capitalized terms 

herein have the same definition as in the 

Commission’s LGIA or in the OATT, as applicable. 

18LGIA Article 1. See supra n.1. 

19The Point of Interconnection is defined in 

Article 1 of the LGIA as the point where the 

Interconnection Facilities connect to the 

Transmission Provider’s Transmission System. 

20The Point of Change of Ownership is defined 

in Article 1 of the LGIA as the point, as set forth 

in Appendix A to the LGIA, where the 

Interconnection Customer’s Interconnection 

Facilities connect to the Transmission Provider’s 

Interconnection Facilities. LGIP section 11.2 states 

that the Transmission Provider and Interconnection 

Customer shall negotiate the provisions of the 

appendices to the LGIA. 

21LGIA Article 1. 

22 In limited circumstances, power may flow from 

the grid to supply station power in the event no 

power is being produced at the generating facility. 

23See, e.g., Bayonne Energy Center, LLC, 136 

FERC ¶ 61,019 (2011) (involving a 6.75-mile, 345- 

kV interconnection facility); Terra-Gen Dixie 

Valley, LLC, 132 FERC ¶ 61,215 (2010) (Terra-Gen 

I), reh’g denied, 134 FERC ¶ 61,021 (2011), order on 

request for priority rights, 137 FERC ¶ 61,179 

(2011), order on reh’g, 147 FERC ¶ 61,122 (2014) 

(involving a 214-mile, 230-kV interconnection 

facility). See also, e.g., Southern Company Serv., 

Inc., Docket No. ER12–554–000 (Jan. 6, 2012) 

(delegated letter order) (involving an approximately 

2000 foot interconnection facility). 

24 Milford Wind Corridor, LLC, 129 FERC 

¶ 61,149, at P 24 (2009) (Milford). 

interconnection of electric generating 

units to the transmission grid. 

8. At the same time, the Commission 

issued Order No. 889,10 which 

promulgated the Open Access SameTime Information System (OASIS) and 

Standards of Conduct requirements in 

Part 37 of the Commission’s regulations 

to ensure the contemporaneous 

disclosure of certain information and 

prevent transmission providers from 

engaging in non-discriminatory 

behavior in favor of their marketing 

affiliates.11

9. In Order No. 2003, the Commission 

found that interconnection service plays 

a crucial role in bringing generation into 

the market to meet the growing needs of 

electricity customers and competitive 

electricity markets.12 The Commission 

reiterated that ‘‘[i]nterconnection is a 

critical component of open access 

transmission service,’’ and that ‘‘the 

Commission may order generic 

interconnection terms and procedures 

pursuant to its authority to remedy 

undue discrimination and preferences 

under sections 205 and 206 of the 

Federal Power Act.’’ 13 The Commission 

concluded that there was a pressing 

need for a uniformly applicable set of 

procedures and a pro forma agreement 

to form the basis of interconnection 

service for large generators, and thus 

promulgated the pro forma Large 

Generator Interconnection Procedures 

(LGIP) and the pro forma Large 

Generator Interconnection Agreement 

(LGIA) 14 to be included in every public 

utility’s OATT.15

10. Article 11.1 of the LGIA provides 

that the ‘‘Interconnection Customer 

shall design, procure, construct, install, 

own and/or control Interconnection 

Customer Interconnection Facilities . . . 

at its sole expense.’’ The LGIA defines 

ICIF as ‘‘all facilities and equipment, as 

identified in Appendix A of the 

Standard Large Generator 

Interconnection Agreement, that are 

located between the Generating Facility 

and the Point of Change of Ownership, 

including any modification, addition, or 

upgrades to such facilities and 

equipment necessary to physically and 

electrically interconnect the Generating 

Facility to the Transmission Provider’s 

Transmission System. Interconnection 

Customer’s Interconnection Facilities 

are sole use facilities.’’ 16 The LGIA 

defines ‘‘Interconnection Facilities’’ 17

as the: 

Transmission Provider’s Interconnection 

Facilities and the Interconnection Customer’s 

Interconnection Facilities. Collectively, 

Interconnection Facilities include all 

facilities and equipment between the 

Generating Facility and the Point of 

Interconnection, including any modification, 

additions or upgrades that are necessary to 

physically and electrically interconnect the 

Generating Facility to the Transmission 

Provider’s Transmission System. 

Interconnection Facilities are sole use 

facilities and shall not include Distribution 

Upgrades, Stand Alone Network Upgrades or 

Network Upgrades.18

Finally, the LGIA defines Transmission 

Provider’s Interconnection Facilities as 

‘‘those Interconnection Facilities that 

are located between the Point of 

Interconnection 19 with the grid and the 

Point of Change of Ownership,20 and 

which are owned, controlled, or 

operated by the transmission 

provider.’’ 21

11. In general, Interconnection 

Facilities are constructed to enable a 

generation facility or multiple 

generation facilities to transmit power to 

the integrated transmission grid. 

Interconnection Facilities are typically 

radial in nature, with a single point of 

interconnection with the network grid, 

and over which power flows in one 

direction toward the transmission 

grid.22 Depending on the circumstances, 

Interconnection Facilities may range in 

length, but can span considerable 

distances and represent significant 

transmission capacity.23

12. In a series of cases since Order No. 

2003 became effective, issues have been 

raised regarding the extent to which, if 

at all, third parties should be able to 

have access rights for transmission on 

the facilities located between the 

generating facility and the Point of 

Change of Ownership at which the 

Transmission Provider’s 

Interconnection Facilities begin, i.e., 

ICIF. Applications have come before the 

Commission as petitions for declaratory 

order and requests for service under 

sections 210 and 211. In each of these, 

the Commission has put the onus on the 

developer, if it would like to preempt a 

third party’s use, to demonstrate that it 

has plans to use the currently excess 

capacity. 

13. In Milford Wind Corridor, LLC, the 

Commission recognized that it has 

granted waivers of the OATT 

requirements on a case-by-case basis for 

ICIF owners who demonstrate that their 

ICIF are limited and discrete and there 

is no outstanding request by a third 

party to access the ICIF.24

14. At issue in these cases was 

whether the entity that owns and/or 

controls ICIF to serve its or its affiliates’ 

generation project or projects has any 

priority right over third-party requesters 

to use the capacity on its ICIF. Where an 

ICIF owner has specific, pre-existing 

generator expansion plans with 

milestones for construction of 

generation facilities and can 

demonstrate that it has made material 

progress toward meeting those 

milestones, the Commission granted 

priority rights for excess capacity on the 

ICIF for those future generation 

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Federal Register / Vol. 80, No. 62 / Wednesday, April 1, 2015 / Rules and Regulations 17657 

25Alta Wind I, LLC, 134 FERC ¶ 61,109, at PP 16– 

17 (2011); Milford, 129 FERC ¶ 61,149 at P 22; Aero 

Energy LLC, 116 FERC ¶ 61,149, at P 28 (2006) Aero 

Modification Order. Such plans and initial progress 

also must pre-date a valid request for service. TerraGen I, 132 FERC ¶ 61,215 at P 53. 

26Aero Energy LLC, 115 FERC ¶ 61,128 (2006) 

(Aero Proposed Order), order granting modification, 

116 FERC ¶ 61,149 (2006) (Aero Modification 

Order), final order, 118 FERC ¶ 61,204 (2007), reh’g 

denied, 120 FERC ¶ 61,188 (2007) (Aero Rehearing 

Order) (collectively, Aero). 

27Aero Modification Order, 116 FERC ¶ 61,149 at 

P 28. 

28See, e.g., Milford, 129 FERC ¶ 61,149 at P 24; 

Terra-Gen I, 132 FERC ¶ 61,215 at P 49. 

29 Milford, 129 FERC ¶ 61,149 at P 22. 

30The Aero precedent cited above is the only 

instance where the Commission has not granted 

priority rights upon an attempted plans and 

milestones demonstration. 

31See NextEra Energy Resources, LLC, 142 FERC 

¶ 61,043, at P 26 (2013). 

32Subsequent to ordering transmission under 

FPA sections 210 and 211 in Aero, the Commission 

granted market-based rates to several Sagebrush 

affiliates on the condition that Sagebrush file an 

OATT for its line if any third party filed a request 

for service on the line. EDFD Handsome-Lake, 127 

FERC ¶ 61,243, at P 15 (2009). Such a request was 

made, and Sagebrush filed an OATT for its 

interconnection facility. Sagebrush, a California 

Partnership, 130 FERC ¶ 61,093, order on reh’g, 132 

FERC ¶ 61,234 (2010). In Peetz Logan, the 

generation owner filed an OATT in response to a 

request for third-party interconnection and 

transmission services over its existing 78.2-mile, 

230-kV ICIF that had been used to connect three 

affiliated wind generation projects to the grid. Peetz 

Logan Interconnect, LLC, 136 FERC ¶ 61,075 (2011) 

(Peetz Logan). In Sky River, the Commission 

rejected the filing of an executed Common Facilities 

Agreement providing a third party the right to 

access and utilize Sky River, LLC’s interest in a 

nine-mile 230-kV ‘‘generator tie-line.’’ Instead, the 

Commission required that any service by nonowners over the line must be made pursuant to an 

OATT. Sky River, LLC, 134 FERC ¶ 61,064 (2011) 

(Sky River). Also, in Terra-Gen, the generator owner 

of a 214-mile, 230-kV radial interconnection facility 

was ordered by the Commission to file an OATT in 

response to a request for third-party transmission 

service. Terra-Gen Dixie Valley, LLC, 134 FERC 

¶ 61,027 (2011), order on reh’g, 135 FERC ¶ 61,134 

(2011), order granting extension of time, 136 FERC 

¶ 61,026 (2011), order on reh’g, 147 FERC ¶ 61,122 

(2014). 

33See Milford, 129 FERC ¶ 61,149 at P 24 (noting 

that the fact that the facilities merely tie a generator 

to the grid does not render a line exempt from the 

Commission’s regulation of transmission facilities). 

See also Evergreen Wind Power III, LLC, 135 FERC 

¶ 61,030, at P 15 n.18 (2011) (granting request for 

waiver of the OATT requirement in the context of 

a request for market-based rate authority). 

34The Commission has the general statutory 

authority to waive its regulations as it may find 

necessary or appropriate. UtiliCorp United Inc., 99 

FERC ¶ 61,280, at P 12 (2002); see also Pacific Gas 

and Electric Co., 99 FERC ¶ 61,045, at P 5 (2002) 

(‘‘It is however well established that, with or 

without an explicit provision to that effect, an 

agency may waive its regulations in appropriate 

cases.’’). Similarly, section 358.1(d) of the 

Commission’s regulations provides that a 

transmission provider may seek a waiver from all 

or some of the requirements of Part 358. 

35See, e.g., Prairie Breeze Wind Energy LLC, 145 

FERC ¶ 61,290, at P 26 (2013); Ebensburg Power 

Company, 145 FERC ¶ 61,265, at P 27 (2013); 

CSOLAR IV South, LLC, 143 FERC ¶ 61,275, at P 16 

(2013). 

36 Milford, 129 FERC ¶ 61,149 at P 27. See 

Termoelectrica U.S., LLC, 105 FERC ¶ 61,087, at P 

11 (2003); Black Creek Hydro, Inc., 77 FERC 

¶ 61,232, at 61,941 (1996). 

37NOPR, FERC Stats. & Regs. ¶ 32,701 at P 54. 

projects.25 For example in Aero Energy, 

LLC,26 before ordering service over the 

Sagebrush line pursuant to FPA sections 

210 and 211, the Commission provided 

the opportunity for the ICIF owner to 

demonstrate that it had pre-existing 

contractual obligations or other specific 

plans that would prevent it from 

providing the requested firm 

transmission service to the third party.27

As a result, the Commission found that 

one of the Sagebrush partners had 

shown that it had pre-existing 

expansion plans that, at some future 

date, would require firm transmission 

capacity, and that two other Sagebrush 

partners had not shown that they had 

pre-existing expansion plans that would 

require additional transmission 

capacity. 

15. The Commission has also 

considered, on a case-by-case basis, 

petitions for declaratory order 

requesting that an ICIF owner be granted 

priority over third parties to use 

capacity on its ICIF.28 In Milford, the 

Commission granted such priority, 

finding that Milford had shown that it 

had specific plans for phased 

development of its generation. The 

Commission in Milford summarized the 

Aero precedent as providing that: 

A transmission owner that filed specific 

expansion plans with definite dates and 

milestones for construction, and had made 

material progress toward meeting its 

milestones, had priority over later 

transmission requests.29

This required demonstration necessary 

to claim priority rights has been referred 

to as the ‘‘specific plans and 

milestones’’ showing. This granting of 

priority rights preserves the ability of 

the generation developer to deliver its 

future output to the point of 

interconnection with the integrated 

transmission grid, so long as it can make 

the relevant showing to the Commission 

sufficient to justify priority.30 The 

Commission has also found that an 

affiliate of the ICIF owner that is 

developing its own generator projects 

also may obtain priority rights to the 

capacity on the ICIF by meeting the 

‘‘specific plans and milestones’’ 

standard with respect to future use.31

16. Notwithstanding the ability of an 

ICIF owner to request priority rights, 

where an ICIF owner has received a 

third-party request for service, the 

Commission has required that the ICIF 

owner file an OATT.32

17. In summary, the Commission’s 

existing policy since 2009 is that, 

because ICIF are facilities used for the 

transmission of electric energy in 

interstate commerce, those who own, 

control, or operate ICIF must either have 

an OATT on file or receive a waiver of 

the OATT requirement.33 Section 

35.28(d) provides that any public utility 

subject to OATT, OASIS, and Standards 

of Conduct requirements may file a 

request for a waiver for good cause 

shown.34 The Commission grants such 

requests for waiver where the public 

utility owns only limited and discrete 

facilities or is a small utility.35 Even if 

a waiver of the OATT is granted for 

ICIF, the ICIF owner is subject to the 

requirement that, if a request for 

transmission service over the facilities is 

made, it would have to file an OATT 

within 60 days of the request 36 and 

comply with any additional 

requirements then in effect for public 

utility transmission providers. The ICIF 

owner would thus become subject to all 

of the relevant pro forma OATT 

requirements, unless it successfully 

seeks and receives approval for 

deviations from the pro forma OATT. 

III. Need for Reform 

A. Commission Proposal 

18. The Commission issued a NOPR 

in this proceeding on May 15, 2014. In 

the NOPR, the Commission proposed to 

grant a blanket waiver for ICIF of all 

OATT, OASIS, and Standards of 

Conduct requirements in circumstances 

where a public utility is subject to such 

requirements solely because it owns, 

controls, or operates ICIF and sells 

electric energy from its generating 

facility. The Commission also proposed 

a safe harbor period of five years during 

which there would be a rebuttable 

presumption that: (1) The eligible ICIF 

owner has definitive plans to use its 

capacity without having to make a 

demonstration through a specific plans 

and milestones showing; and (2) the 

eligible ICIF owner should not be 

required to expand its facilities.37 The 

Commission found, on a preliminary 

basis, that there was a need for reform 

because OATT requirements as applied 

to ICIF may impose risks and burdens 

on generators and create regulatory 

inefficiencies that are not necessary to 

achieve the Commission’s open access 

goals. The Commission also 

preliminarily found that there was a 

need to reform its requirements for 

achieving non-discriminatory access 

over ICIF so as not to discourage 

competitive generation development 

with unnecessary burdens, while 

ensuring non-discriminatory access by 

eligible transmission customers. 

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38See Appendix A for a list of NOPR 

commenters. 

39These include AWEA, BHE, BP Wind, Linden, 

DTE, E.ON, EEI, ELCON, EPSA, First Wind, 

Invenergy, ITC, MISO, MISO TOs, NextEra, NRG, 

Recurrent, SEIA, Sempra, Southern, and Terra-Gen. 

SWP also commented on the NOPR, but did not 

express support or opposition to the proposed 

changes overall. 

40AWEA at 1; E.ON at 2; and NextEra at 3. 

41EEI at 2. 

42AWEA at 2; Linden at 3; and E.ON at 2. 

43BHE at 1; EEI at 2; and ELCON at 2. 

44Terra-Gen at 1. 

45Terra-Gen at 1 (citing New York State Electric 

& Gas Corp. v. FERC, 638 F.2d 388, 402 (2d. Cir. 

1980), cert. denied, 454 U.S. 821 (1981)). 

46Linden at 4. 

47ELCON at 2. 

48MISO at 4–5. 

49BP Wind at 4; Linden at 3; ELCON at 2; and 

E.ON at 2. 

50MISO at 5. 

51MISO at 5. 

52APPA and TAPS at 2 and NCPA at 3. 

53APPA and TAPS at 2. 

54NCPA at 3. 

55NRECA at 2. 

56NCPA states that it supports the comments 

submitted by APPA and TAPS. NCPA at 1 and 3. 

57APPA and TAPS at 20 (citing NOPR, FERC 

Stats. & Regs. ¶ 32,701 at PP 32, 36). 

58APPA and TAPS at 21. 

59APPA and TAPS at 8 (citing NOPR, FERC Stats. 

& Regs. ¶ 32,701 at P 9, n.16). 

60APPA and TAPS at 8–9. 

B. Comments 

19. The Commission received 24 

comments and one reply comment on 

the NOPR.38 Of those, 21 commenters 39

generally support the need for reform 

and the NOPR proposals. Commenters 

state that the Commission’s existing 

policy is unduly burdensome and 

unnecessary 40 and that it does not meet 

the goal of promoting development of 

generation facilities while ensuring not 

unduly discriminatory open access to 

transmission facilities.41 Commenters 

argue that ICIF owners are focused on 

developing new generation resources 

and the time, effort and cost of 

complying with the OATT requirements 

under the Commission’s existing policy 

hinders generation development.42

Commenters support the Commission’s 

goal of reducing regulatory burdens and 

promoting development of generation 

facilities while ensuring open access to 

transmission facilities and support the 

Commission’s proposal to revise its 

current ICIF policies.43

20. Terra-Gen states that the NOPR 

proposals are essential to minimize the 

business and regulatory risks faced by 

generation owners and developers.44

Further, Terra-Gen argues that the 

Commission’s existing ICIF policy 

allows third parties to impose 

substantial and potentially 

unrecoverable regulatory compliance 

and other costs on generation owners by 

requesting access to ICIF without 

making a showing that the third party is 

‘‘ready, willing, and able to pay the 

reasonable costs of transmission 

services plus a reasonable rate of return 

on such costs.’’ 45

21. Linden states that ICIF owners 

generally plan to use the excess capacity 

on their ICIF for their own purposes and 

that the Commission’s existing policy 

imposes a risk of losing that capacity if 

another party makes a request for 

service.46 ELCON argues that an ICIF 

owner should retain the rights over its 

ICIF for its own future projected use.47

22. MISO supports revising the 

Commission’s ICIF policy because it 

argues that the existing policy: (1) 

Creates disincentives to develop more 

efficient, high-voltage ICIF by 

expanding the costs and responsibilities 

of generation owners; (2) imposes 

transmission owner requirements on 

entities that are not in the business of 

providing transmission service to third 

parties; and (3) creates concerns over 

the interaction of ICIF with the 

transmission system, and the reliable 

interconnection of projects to the 

transmission system.48

23. Commenters argue that ICIF are 

unique and the Commission’s open 

access requirements and pro forma 

OATT were not designed for and are not 

appropriate for these facilities.49 MISO 

asserts that use of an OATT by an ICIF 

owner raises complicated issues 

regarding seams agreements between the 

transmission provider and the ICIF 

owner and issues related to Order No. 

1000-compliance regional transmission 

planning and cost allocation.50 MISO 

also notes that using OATTs for access 

to ICIF could create different 

interconnection processes for different 

ICIF within the MISO footprint, thus 

complicating the interconnection 

process.51

24. On the other hand, APPA, TAPS, 

and NCPA state that they support the 

Commission’s goal of promoting 

generation development, but assert that 

the NOPR proposals would erode the 

Commission’s open access transmission 

policies.52 APPA and TAPS argue that 

the Commission should instead address 

the concerns identified in the NOPR in 

a manner that preserves the open access 

underpinnings of competitive markets 

and its reliance on market-based rates to 

ensure just and reasonable wholesale 

sales, and meets its statutory obligation 

to eliminate undue discrimination in 

transmission service. APPA and TAPS 

contend that the NOPR, as proposed, 

fundamentally erodes open access by 

making it effectively impossible for 

subsequent competitive generation 

developers to interconnect with the ICIF 

owner’s facilities for long periods of 

time, if ever.53 NCPA states that while 

it supports the Commission’s desire to 

promote generation development, it 

shares the concerns expressed by APPA 

and TAPS that the NOPR imperils the 

open access underpinnings for 

competitive markets by cutting back on 

the significant procedural reforms 

initiated by this Commission in Order 

Nos. 888 and 889, and supports the 

alternatives proposed by APPA and 

TAPS, as described below, by which the 

Commission could achieve the NOPR’s 

objectives without unnecessarily 

reducing the protection from 

discrimination that those orders 

provided.54 Similarly, NRECA states 

that it appreciates the Commission’s 

concerns about imposing the entire 

open access regime on entities that only 

own ICIF, but contends that reducing 

this burden must not come at the 

expense of ensuring that load-serving 

entities have access to facilities to serve 

their loads.55

25. APPA and TAPS 56 argue that the 

NOPR fails to demonstrate the need to 

change the requirement that an ICIF 

owner file an OATT upon receipt of a 

third-party request for service, noting 

that the NOPR itself recognizes that 

third-party requests to ICIF owners for 

service are ‘‘infrequen[t]’’ and 

‘‘relatively rare.’’ 57 They also contend 

that the NOPR has not demonstrated 

that the proposed procedures would 

cost less than existing requirements, 

arguing that the lengthy and costly 

procedures of sections 210 and 211 

could not possibly be less expensive for 

ICIF owners on an industry-wide basis. 

They argue that the NOPR proposals 

will therefore be ineffective at reducing 

the regulatory costs of ICIF owners and 

may function as a bar to open access.58

26. APPA and TAPS contend that the 

NOPR would invite ICIF owners to close 

off access to what could well be 

significant highways to areas ripe for 

renewable resource development.59

APPA and TAPS argue that the NOPR 

would allow an ICIF owner to hold that 

transmission corridor hostage, block 

efficient expansion, and deny access to 

competitors. They add that the ICIF 

owner is likely to be the competitor of 

the third party seeking interconnection 

and transmission service over the ICIF, 

giving the ICIF owner strong incentive 

to use its control over ICIF to the 

advantage of its own generation 

resources.60

27. APPA and TAPS also state that the 

Commission cannot assume that open 

access principles need not apply to ICIF 

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61APPA and TAPS at 9–10. 

62APPA and TAPS at 21–22. 

63APPA and TAPS at 23. 

64APPA and TAPS at 23–24. 

65NRECA at 5–6. 

66NRECA at 6–7. 

67NRECA at 7. 

68Priority Rights to New Participant-Funded 

Transmission, March 15, 2011 Technical 

Conference, AD11–11–000. 

69Open Access and Priority Rights on 

Interconnection Facilities, Notice of Inquiry, FERC 

Stats. & Regs. ¶ 35,574 (cross-referenced at 139 

FERC ¶ 61,051 (2012). 

70See NextEra at 5 (‘‘Two of the three NextEra 

subsidiaries that received inquiries triggering OATT 

filings with respect to their ICIF—Sagebrush and 

Peetz Logan—never had customers actually pursue 

transmission or interconnection service following 

the initial inquiries’’) and Terra-Gen at 2 (‘‘Dixie 

Valley . . . incurred substantial costs in attempting 

to comply with the Commission’s OATT 

requirements over several years, only to find that 

it would have no way to recover those costs because 

the customer that requested transmission service 

ultimately did not become a transmission 

customer’’). 

71Sky River, 134 FERC ¶ 61,064 at P 13. 

because competitors can build their 

own, arguing that such lines require 

extensive permitting, and that it is often 

more difficult to obtain siting approvals 

for a second line once a first line has 

been permitted.61 They contend that, 

even where it is possible to obtain 

necessary siting approvals for 

duplicative lines, inefficient build-out 

of the grid would make it more costly 

than necessary to access new generation 

resources, burdening those resources 

and consumers, as well as undermining 

competitive wholesale markets. 

28. APPA and TAPS contend that 

departure from the Commission’s nondiscriminatory access requirements 

cannot be excused by the fact that usage 

of ICIF has been requested infrequently 

thus far, arguing that ICIF access may 

well become more common in the future 

given the increasing dependence on 

renewable resources. 

29. APPA, TAPS, and NRECA suggest 

alternatives to the NOPR proposals. 

APPA and TAPS state that the 

Commission could grant a blanket 

waiver of OATT, OASIS, and Standards 

of Conduct requirements, but require 

ICIF owners to submit a standardized, 

more limited OATT within 60 days of 

a third-party service request. APPA and 

TAPS argue that the modified OATT 

should not remove core elements of 

open access, including the obligation to 

expand and the development of rates for 

point-to-point service, but could 

eliminate provisions for network 

transmission service and ancillary 

services.62 They state that this will 

reduce the regulatory burden on ICIF 

owners and eliminate the need to apply 

for special waivers on a case-by-case 

basis, while preserving key limitations 

on the ICIF owner’s ability to 

discriminate and create barriers to entry 

to competitive markets. 

30. APPA and TAPS state that the 

Commission could address the concern 

that the existing policy creates too low 

a bar for third-party requests to trigger 

the requirement for an ICIF owner to file 

an OATT by specifying clarified and 

heightened thresholds for a service 

request to trigger the requirement to file. 

They add that the Commission could 

approve fee structures that enable an 

ICIF owner to insist upon reasonable 

deposits before the obligation to file a 

notice of receipt of a service request 

and, subsequently, an OATT is 

triggered.63 They argue that such 

additional deposits would discourage 

speculative service requests that trigger 

a first-time OATT filing and fully 

address the specific ICIF owner 

regulatory burden that the NOPR 

identifies. They contend that while the 

extra deposit would increase costs for 

the first entity that seeks service from 

the ICIF owner’s corporate family, the 

amount of the deposit would be much 

lower than the costs of requesting, 

negotiating, and litigating service under 

sections 210 and 211.64

31. NRECA suggests that the 

Commission could implement a 

procedure under which a prospective 

customer seeking service on ICIF must 

submit a request that is fully supported 

by specified information, followed by 

the necessary studies and the parties 

cooperating to reach an agreement for 

service within a specified period of 

time, such as 90 days.65 NRECA adds 

that if the parties are not able to reach 

an agreement, the ICIF owner would file 

an unexecuted service proposal with the 

Commission.66

32. NRECA argues that its proposed 

procedures would address the 

Commission’s concern that the existing 

policy ‘‘creates too low a bar for thirdparty requests for service’’ because those 

seeking service would be required to 

provide adequate information to support 

their requests. NRECA also argues that 

its proposal would alleviate the concern 

that an ICIF owner may be required to 

file an OATT due to a service request by 

a requester that subsequently fails to 

pursue any further development, 

because a mere service request would 

no longer trigger that requirement. In 

addition, NRECA contends that its 

proposal would promote flexibility by 

requiring the parties to work together to 

attempt to reach an agreement.67

C. Commission Determination 

33. We believe this Final Rule will 

relieve regulatory burdens and 

unnecessary risks from generation 

developers to encourage the 

development of new generation and 

efficient interconnection facilities and 

promote competition while ensuring 

access to transmission on a not unduly 

discriminatory basis. 

34. Our action is supported by 

comments on the NOPR, the technical 

conference,68 and Notice of Inquiry.69

Specifically, we appreciate that filing 

and maintaining an OATT can be 

burdensome to ICIF owners who do not 

seek to provide transmission service. 

Adding a potential OATT obligation to 

a generation project can introduce an 

additional element of risk for the 

developer and its lenders that they 

would not have if the project were not 

subject to the potential obligation to file 

and maintain a transmission tariff. The 

risk stems from the policy to require an 

ICIF owner to file an OATT within 60 

days of a request for service by a third 

party and must begin interconnection 

studies. The ICIF owner’s obligation can 

be triggered with minimal effort by a 

third party requester, thus a request for 

service may not sufficiently distinguish 

third party requesters who have a wellsupported request for service from those 

that do not. We are aware of situations 

where the ICIF owner received a request 

for service triggering the requirement 

that the owner file an OATT, but the 

requester then failed to pursue any 

further development.70 This is an 

additional risk for the ICIF owner. 

35. We also agree that a number of 

sections of the pro forma OATT, such as 

the provisions regarding network 

service, ancillary services, and planning 

requirements, are arguably inapplicable 

to most or all ICIF owners. Although 

ICIF owners may propose deviations 

from the pro forma OATT, the 

Commission’s existing process of 

handling these proposed deviations on 

a case-by-case basis can impose the risk 

of a time-consuming proceeding with an 

uncertain outcome. 

36. Moreover, interconnecting with 

ICIF often involves unique 

circumstances that would benefit from 

negotiations to tailor individual access 

agreements. However, the existing 

policy limits an ICIF owner’s 

contractual flexibility and does not 

allow parties to use common facility 

agreements or have service governed 

outside of an OATT.71

37. In addition, it is common for an 

ICIF owner to initially have excess 

capacity on its ICIF when it plans to 

bring generation into commercial 

service in stages. The Commission has 

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72APPA and TAPS at 20. 

73AWEA at 2 and E.ON at 2. 

74Between January 1, 2009, and January 1, 2014, 

the Commission issued approximately 80 orders 

granting waiver of OATT, OASIS, and Standards of 

Conduct requirements to ICIF owners. 

75See, e.g., Aero Modification Order, 116 FERC 

¶ 61,149 at P 28. 

76NOPR, FERC Stats. & Regs. ¶ 32,701 at PP 1 and 

35. 

77LGIA Article 1. 

78First Wind at 11–12 and Invenergy at 4–6. 

79AWEA at 7–8. 

a process for granting priority rights to 

the ICIF owner for such excess capacity 

on a case-by-case basis. However, filing 

a petition for declaratory order to 

establish priority rights can be a 

significant burden for the ICIF owner 

because the Commission’s existing 

policy of requiring a demonstration of 

‘‘specific plans and milestones’’ can 

require substantial effort and resources 

on the part of the ICIF owner to make 

the necessary showings. Further, these 

priority rights do not diminish the risk 

and potential burden that the ICIF 

owner may have to file an OATT within 

60 days of a request for service. 

38. Contrary to APPA and TAPS’ 

argument that the proposed revisions 

will likely cost more to implement than 

the Commission’s existing OATT 

requirements,72 other commenters assert 

that the risks described above fall on all 

ICIF owners and therefore that the 

Commission’s existing policy imposes 

costs,73 despite the fact that it is 

unlikely that any third party would 

request OATT service on most ICIF. The 

Commission has issued numerous 

individual orders granting waivers of 

OATT, OASIS, and Standards of 

Conduct to ICIF owners, but in only four 

instances did a third-party request 

access on ICIF such that the filing of an 

OATT was required.74 Although only a 

small percentage of ICIF owners have 

actually had to file an OATT, all ICIF 

owners are subject to the additional 

risks and potential regulatory burdens 

discussed above, including possibly 

having to file an OATT on 60 days’ 

notice in response to a request for 

service, and possibly losing some of the 

ICIF capacity planned for future use to 

a requesting third party. In response to 

commenters concerns that the process 

under sections 210 and 211 is more 

expensive for potential transmission 

customers than the existing process, we 

note that the cost of any process has 

many variables. This Final Rule 

specifically allows for voluntary 

interconnection agreements, which may 

be a more efficient process than 

currently exists. Under our existing 

policy, while a potential transmission 

customer may trigger an ICIF owner’s 

OATT obligation by making a simple 

request for service, the potential 

customer often bears the expense to be 

a party to what are sometimes 

controversial proceedings. We find that 

the proposed reforms will avoid the 

expense of requests that are unlikely to 

be successful. Accordingly, we find that 

reforming the open access transmission 

requirements in this narrow set of 

circumstances is appropriate. 

39. We find that APPA and TAPS’ 

concerns that the NOPR would allow an 

ICIF owner to close off access to 

significant highways to areas ripe for 

renewable resource development 

overlook practical considerations of 

infrastructure development. The 

approach taken in this Final Rule 

recognizes that, often, an ICIF owner 

anticipates that it will use its excess 

ICIF capacity, and seeks to reduce 

unnecessary regulatory burdens. The 

Commission precedent with respect to 

priority use has given ICIF owners the 

opportunity to demonstrate that they 

had pre-existing contractual obligations 

or other specific plans that would 

prevent them from providing the 

requested transmission service at a 

future date.75 In balancing the 

considerations, we are persuaded that 

the process under sections 210 and 211 

allows an ICIF owner to be reasonably 

assured of being able to use that extra 

capacity, while also providing a 

mechanism for expansion. Without such 

reasonable assurance, there is no 

incentive for a developer to shoulder the 

extra expense of ICIF sized larger than 

their initial project. 

40. Moreover, we agree with NRECA 

that it is important to promote flexibility 

by encouraging the ICIF owner and the 

third party to work together to attempt 

to reach an agreement. As discussed 

further below, this Final Rule adopts a 

framework that includes opportunities 

for the ICIF owner and third party to 

reach mutually agreeable solutions, 

either as part of a proceeding under 

sections 210 and 211, or in such a way 

that obviates the need to bring a 

proceeding under sections 210 and 211 

to the Commission. 

IV. Proposed Reforms 

A. Eligible ICIF 

1. Commission Proposal 

41. In the NOPR, the Commission 

defined the facilities that were subject to 

the rule as ICIF because that term 

already had a specific definition in the 

pro forma LGIA and LGIP.76 The 

Commission proposed to apply the 

NOPR reforms to any public utility that 

is subject to OATT, OASIS, and 

Standards of Conduct requirements 

solely because it owns, controls, or 

operates ICIF, in whole or in part, and 

sells electric energy from its generating 

facility, as those terms are defined in the 

pro forma LGIP and the pro forma LGIA 

adopted in Order No. 2003. The LGIA 

and LGIP define ICIF as ‘‘all facilities 

and equipment, as identified in 

Appendix A of the LGIA, that are 

located between the generating facility 

and the Point of Change of Ownership, 

including any modification, addition, or 

upgrades to such facilities and 

equipment necessary to physically and 

electrically interconnect the generating 

facility to the transmission provider’s 

transmission system.’’ 77

2. Comments 

42. First Wind and Invenergy 

recommend that the Commission not 

define the interconnection facilities 

subject to the waiver with reference to 

the LGIA and LGIP, but simply as those 

facilities located between the generating 

facility and the point of interconnection 

to the transmission provider’s 

transmission system. This is because 

some interconnection agreements 

predate Order No. 2003 which first 

defined ICIF; some may be implemented 

under the small generator 

interconnection procedures under Order 

No. 2006; and some agreements were 

entered into with non-Commission 

jurisdictional transmission providers. 

They argue that the definition of ICIF 

and generating facility should be revised 

to encompass facilities that may not be 

installed under the Commission’s LGIA/ 

LGIP arrangements.78 Similarly, AWEA 

seeks clarification that ICIF owners who 

do not have interconnection agreements 

under pro forma arrangements or those 

that have shared facilities agreements 

(or similar understandings) also qualify 

for the blanket waiver.79

3. Commission Determination 

43. We expand our definition of what 

interconnection facilities are subject to 

the Final Rule to include ICIF as well as 

comparable jurisdictional 

interconnection facilities that are the 

subject of interconnection agreements 

other than an LGIA. For those 

interconnection customers that have 

entered into an LGIA, these facilities 

will be those defined as ICIF in the 

LGIA and LGIP. For those 

interconnection customers that have 

entered into interconnection agreements 

other than an LGIA, these facilities will 

be the comparable set of interconnection 

facilities as those described as ICIF in 

the LGIA. Therefore, the term ICIF 

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80The Commission also proposed to make nonsubstantive revisions to what is currently 18 CFR 

35.28(d) in order to update certain cross-references 

in that paragraph. 

81NOPR, FERC Stats. & Regs. ¶ 32,701 at P 35. 

82EEI at 3 and BHE at 6–7. 

83EEI at 8–9; BHE at 6–7; and E.ON at 2. 

84EEI at 8–9; BHE at 6–7; and E.ON at 2. 

85NextEra at 4–5 and E.ON at 2. 

86E.ON at 2. 

87BHE at 6–7 and E.ON at 2. 

88BHE at 6–7. 

89NextEra at 3–4. 

90 DTE at 2. 

91NextEra at 7. 

92Southern at 4. 

93APPA and TAPS at 10. 

should be read in this Final Rule to 

encompass this broader scope. We use 

the term ‘‘comparable’’ set of 

interconnection facilities because the 

definition of ICIF in the LGIA is made 

with reference to specific facilities listed 

in an appendix to the LGIA and to terms 

defined elsewhere in the LGIA. 

Therefore, we cannot apply literally the 

definition of ICIF in the LGIA to 

describe facilities in interconnection 

agreements other than the LGIA. 

Generally, this comparable set of 

facilities would include all facilities and 

equipment that are located between an 

interconnection customer’s generating 

facility and the point where such 

facilities connect to the transmission 

provider’s interconnection facilities 

(called the ‘‘point of change of 

ownership’’ in the LGIA) that are 

necessary to physically and electrically 

interconnect the interconnection 

customer’s generating facility to the 

transmission provider’s facilities that 

are used to provide transmission service 

(called the ‘‘point of interconnection’’ in 

the LGIA). 

B. Grant Blanket Waivers to Eligible ICIF 

Owners 

1. Blanket Waivers 

a. Commission Proposal 

44. The Commission proposed to add 

sub-paragraph (d)(2) to 18 CFR 35.28 to 

grant a blanket waiver of all OATT, 

OASIS, and Standards of Conduct 

requirements to any public utility that is 

subject to such requirements solely 

because it owns, controls, or operates 

ICIF, in whole or in part, and sells 

electric energy from its generating 

facility, as those terms are defined in the 

LGIP and LGIA.80 The Commission 

proposed that the blanket waiver would 

apply to all eligible existing and future 

ICIF owners, and explained that the 

limitation to ICIF owners that sell 

electric energy was meant to ensure that 

the proposed blanket waiver would only 

apply in situations where sections 210 

and 211 would provide interconnection 

and transmission access to a customer 

that seeks service over the ICIF.81

b. Comments 

45. The majority of commenters 

support the Commission’s proposal to 

grant a blanket waiver of all OATT, 

OASIS, and Standards of Conduct 

requirements to public utility ICIF 

owners. Commenters agree with the 

Commission’s preliminary findings in 

the NOPR that a blanket waiver is 

justified because such facilities do not 

typically present the concerns about 

discriminatory conduct that the 

Commission’s OATT, OASIS, and 

Standards of Conduct requirements 

were intended to address.82

Commenters agree that the 

Commission’s existing practice of 

requiring an OATT for ICIF discourages 

generation development and results in a 

disincentive to be the first developer in 

an area to build ICIF, while creating a 

relative advantage for subsequent 

competing generation developers in that 

area.83 Additionally, they argue that the 

Commission’s existing practice 

unreasonably causes developers of ICIF 

to incur significant costs in response to 

mere written third-party requests 

unaccompanied by any deposit. 

Commenters agree that the requirement 

to file an OATT following any thirdparty request creates a regulatory 

burden without a corresponding 

enhancement of access.84

46. Commenters state that the OATT 

is not a good fit for the services that can 

be provided over ICIF, and argue that 

such limited service is not comparable 

to the integrated network, point-topoint, and ancillary services provided 

under the pro forma OATT.85 E.ON 

agrees that the current OATT 

requirement can be seen as burdensome 

by ICIF owners who do not seek to be 

in the business of providing 

transmission service, can introduce an 

additional element of risk for the 

developer and its lenders that they 

would not have if the project were not 

subject to the potential obligation to file 

and maintain a transmission tariff, and 

limits an ICIF owner’s contractual 

flexibility if it chooses to provide thirdparty access by mutual agreement.86

47. Commenters state that the 

Commission’s existing policy of 

requiring an ICIF owner to file an OATT 

or seek a waiver that would be revoked 

only upon a third-party request for 

service creates too low a bar for thirdparty requests for service and could lead 

to competitive mischief.87 BHE argues 

that ICIF owners are focused on 

developing new generation resources 

and that, given the infrequency of thirdparty requests and the absence of 

disputes before the Commission, it is 

more reasonable and efficient to address 

third-party requests to access available 

ICIF capacity as they arise on an 

individual basis.88

48. Some commenters argue that 

adjudicating such OATT waiver 

requests and OATT tariff filings on a 

case-by-case basis has led to confusion 

and uncertainty in the industry with 

respect to compliance with the 

Commission’s open access requirements 

as applied to ICIF.89 DTE argues that 

there is a filing burden associated with 

making a waiver request, as well as 

some uncertainty about the actions that 

would need to be taken in the unlikely 

event that these requests for waiver 

were not granted. DTE states that the 

proposed blanket waiver would remove 

any uncertainty regarding the current 

status of existing eligible ICIF owners 

that may have been awaiting the 

Commission’s direction on this matter 

before making the determination of 

whether or not to seek a ‘‘limited and 

discrete’’ waiver from the OATT, OASIS 

and Standards of Conduct regulations.90

Similarly, NextEra argues that the 

implication of the description of 

existing policy in the NOPR is that a 

significant number of generation owners 

should be taking actions to address 

existing open access requirements. 

NextEra points out that, in the NOPR, 

the Commission notes that this lack of 

clarity extends to whether market-based 

rate applicants that own ICIF, or have 

affiliates that own ICIF, must file an 

OATT or seek a waiver from OATT 

requirements in order to show a lack of 

vertical market power. NextEra argues 

that the proposed waiver will provide 

much needed certainty for ICIF owners 

by clearly identifying those entities that 

are not subject to OATT, OASIS, or 

Standards of Conduct requirements.91

49. Southern agrees that the blanket 

waiver approach appears to be 

appropriate given that very few 

generator tie lines have the 

characteristics (e.g., long length, excess 

capacity) that would make them more 

feasible for interconnection by another 

generator than the transmission 

system.92

50. In contrast, APPA and TAPS state 

that creating and maintaining two 

different standards for access to 

transmission facilities is problematic in 

a dynamic grid, adding that ICIF that 

look like radial lines at the fringe of the 

system today may be a more central part 

of the network in a decade or two.93

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94APPA and TAPS at 14. 

95APPA and TAPS at 20. 

96NRECA at 4. 

97Certain aspects of the blanket ICIF waiver 

adopted herein differ from the NOPR proposal. E.g., 

see infra PP 73–75 for the Commission 

determination on the public utilities eligible for the 

blanket waiver and supra P 43 for the Commission 

determination on the ICIF eligible for the blanket 

waiver. 

98To demonstrate the absence of vertical market 

power in a market power analysis, a seller or its 

affiliate that owns, operates, or controls 

transmission facilities must have an OATT on file 

unless waived. See 18 CFR 35.37(d). 

99NOPR, FERC Stats. & Regs. ¶ 32,701 at PP 35, 

43. 

100 16 U.S.C. 824i(a)(1)(A). 

101 16 U.S.C. 796(22). 

51. APPA and TAPS argue that the 

Commission has long required marketbased rate sellers that own transmission 

to demonstrate mitigation of vertical 

market power by showing that they and 

their affiliates either have filed an 

OATT or received a waiver for every 

transmission facility that they own, 

operate, or control, and to offer third 

parties service comparable to the service 

the market-based rate sellers and their 

affiliates provide themselves. APPA and 

TAPS contend that the proposed blanket 

waiver does not clarify the manner by 

which ICIF owners can address 

concerns about vertical market power 

when they seek market-based rate 

authority, but rather that it magnifies 

those concerns by discarding an 

essential foundation for allowing the 

ICIF owner and its affiliates to enjoy 

market-based rates.94

52. APPA and TAPS state that they 

would not oppose an initial grant of a 

blanket waiver of the requirement that 

each ICIF owner must file an individual 

request for waiver of OATT, OASIS, and 

Standards of Conduct, provided that 

such waivers would be revoked upon 

receipt of a third-party request for 

service on the ICIF.95

53. APPA and TAPS argue that the 

NOPR places no limit on the proposed 

blanket waiver, extending it to periods 

when there is no reasonable expectation 

that the ICIF owner is still in the project 

development mode. 

54. NRECA states that it does not 

object to exempting certain ICIF owners 

from the mandate to file an OATT and 

related requirements for limited and 

discrete facilities, but that any such 

waiver should be revoked if the entity 

no longer meets those criteria.96

c. Commission Determination 

55. We adopt the proposed blanket 

waiver with modifications as discussed 

below.97 We believe the proposal as 

modified addresses the concerns of 

commenters while meeting our purpose 

of reducing unnecessary burden and 

providing clarity and certainty to 

developers. Such a waiver is justified 

because the usually limited and discrete 

nature of ICIF and ICIF’s dedicated 

interconnection purpose means that 

such facilities do not typically present 

the concerns about discriminatory 

conduct that the Commission’s OATT, 

OASIS, and Standards of Conduct 

requirements were intended to address. 

Because third-party requests to use ICIF 

have been relatively rare, it is more 

efficient to address such situations as 

they arise on an individual basis. 

56. Further, the ICIF waiver would 

remove regulatory burdens on 

competitive generation developers 

without sacrificing the Commission’s 

ability to require open access in 

appropriate circumstances. Specifically, 

we find that a blanket waiver will 

remedy the undue burden on ICIF 

owners under our existing policy to file 

an OATT or seek a waiver that would 

be revoked upon a third-party request 

for service from ICIF owners. We find 

that the time, effort, and cost of 

complying with the requirements of a 

public utility transmission provider in 

these circumstances unduly burden 

generation development efforts. In 

addition, we agree with commenters 

that the existing policy creates too low 

a bar for third-party requests for service. 

Specifically, an existing waiver of the 

OATT is revoked as soon as the ICIF 

owner receives a third-party request for 

service, even if that request meets few 

of the information and other 

requirements for transmission service 

under the pro forma OATT. 

57. Finally, we agree with DTE and 

NextEra that providing a blanket waiver 

of the OATT for ICIF owners will clarify 

how they meet the OATT filing or 

OATT waiver requirements involved 

when seeking market-based rate 

authority.98 APPA and TAPS argue that 

the blanket waiver does not explain how 

sellers would address vertical market 

power for purposes of market-based rate 

authority. However, this Final Rule 

simply provides an additional method 

for obtaining waiver of the OATT 

requirements. Therefore, to the extent 

that a market-based rate seller or any of 

its affiliates owns, operates, or controls 

transmission facilities, the Commission 

will require that, in order to satisfy the 

Commission’s market-based rate vertical 

market power requirements in 18 CFR 

35.37(d), it either must have a 

Commission-approved OATT on file, 

receive waiver of the OATT requirement 

under 18 CFR 35.28(d)(1), or satisfy the 

requirements for blanket waiver under 

18 CFR 35.28(d)(2). Market-based rate 

filings cannot be used as the vehicle by 

which applicants may obtain 

determinations on whether they qualify 

for an ICIF blanket waiver. 

58. As discussed further below, the 

blanket waiver adopted herein only 

applies in situations where sections 210, 

211, and 212 would provide 

interconnection and transmission access 

to a customer that seeks service over the 

ICIF. This ensures that we are only 

waiving the OATT requirements in 

circumstances where there is an 

alternative for third parties to seek not 

unduly discriminatory access. 

2. Requirement That ICIF Owners Must 

Sell Electricity To Qualify for the 

Waiver 

a. Commission Proposal 

59. The Commission proposed to 

grant the blanket waiver to any public 

utility that is subject to the 

Commission’s OATT, OASIS, and 

Standards of Conduct requirements 

solely because it owns, controls, or 

operates ICIF, in whole or in part, and 

sells electric energy from its generating 

facility. The Commission’s proposal to 

limit the waiver to ICIF owners who sell 

electric energy was intended to ensure 

that any public utility with an OATT 

blanket waiver would be subject to an 

interconnection order under section 

210. This requirement was seen as 

necessary so as not to create a gap and 

leave a potential customer without a 

means of obtaining an interconnection 

with ICIF once the OATT 

interconnection procedures were 

waived.99

60. Section 210 of the FPA provides, 

in relevant part, ‘‘Upon application of 

any electric utility . . . the Commission 

may issue an order requiring (A) the 

physical connection of . . . the 

transmission facilities of any electric 

utility, with the facilities of such 

applicant.’’ 100 An ‘‘electric utility’’ is 

defined as ‘‘a person or Federal or State 

agency . . . that sells electric 

energy.’’ 101 Thus, the NOPR granted the 

waiver only to those that qualified as an 

electric utility to ensure that section 210 

would be applicable. The Commission 

stated that it believes that there would 

be a relatively small number of ICIF 

owners who could not be subject to 

orders under sections 210 and 211, and 

sought comments on whether this 

limitation on which public utilities can 

take advantage of the blanket waiver is 

appropriate. The Commission noted that 

ICIF owners who were not electric 

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102NOPR, FERC Stats. & Regs. ¶ 32,701 at PP 51– 

52. 

103Recurrent at 4; First Wind at 4–8; Invenergy 

at 7–11; BP Wind at 4–5; E.ON at 6; ITC at 8; 

NextEra at 7–9; SEIA at 4–5; Sempra at 3–6; and 

MISO TOs at 5–6. 

104First Wind at 4–8 and Invenergy at 7–11. 

105Sempra at 3 (citing, e.g., Wolverine Creek 

Goshen Interconnection LLC, Docket Nos. ER06– 

267–000 (Letter Order dated Jan. 13 2006), 

Wolverine Creek Energy LLC, et al., Docket Nos. 

ER12–1280–000 and ER12–1281–000 (May 9, 2012) 

(unpublished letter order accepting amended 

common facilities agreement for filing), and Maine 

GenLead, LLC, 146 FERC ¶ 61,223 (2014)). 

106SEIA at 4. 

107Sempra at 3 (citing, e.g., Docket No. ER03– 

175–000, ‘‘Request of Termoelectrica U.S., LLC for 

Rehearing, and Expedited Consideration and/or 

Stay’’ at n.6 (filed Feb. 10, 2003) (TDM Rehearing 

Request), and Termoelectrica U.S., LLC, 105 FERC 

¶ 61,087 (2003) (order granting rehearing relating to 

OATT waivers), Docket No. EC14–80–000, 

‘‘Application for Authorization to Transfer 

Jurisdictional Facilities Pursuant to section 203 of 

the Federal Power Act and Request for Expedited 

Action’’ at pp. 5–6 (describing the planned 

ownership structure of future cross-border 

interconnection facilities), and Energia Sierra 

Juarez U.S., LLC, Docket No. EC14–80–000 (May 29, 

2014) (letter order approving transfer)). 

108BP Wind at 4–5. MISO’s comments seem to 

support this point, stating, ‘‘from an operational 

and reliability perspective, MISO needs to have a 

single Interconnection Customer entity at each 

distinct Point of Interconnection to the 

Transmission System with whom MISO can 

coordinate. That entity must have the authority to 

control any other generators that interconnect to its 

ICIF on its side of the Point of Interconnection.’’ 

MISO at 8. 

109E.ON at 6–7. 

110Recurrent at 5–6. 

111SEIA at 4–5. 

112 ITC at 12–13. 

113BP Wind at 6. 

114First Wind at 4–8 and Invenergy at 7–11. 

115 ITC at 12–13 and MISO TOs at 5–6. 116 ITC at 13. 117MISO TOs at 5–6. 

118Sempra at 4–5 (citing, e.g., Wolverine Creek 

Goshen Interconnection LLC, 111 FERC ¶ 62,209 

(2005) (Wolverine Creek Goshen); Sagebrush, 103 

FERC ¶ 61,332 (2003) (Sagebrush); Termoelectrica 

U.S., LLC, 102 FERC ¶ 61,019 (2003) 

(Termoelectrica); Peetz Logan Interconnect, LLC, 

Docket No. EG06–84–000, ‘‘Notice of Exempt 

Wholesale Generator Status’’ (Sept. 27, 2006); 

Bishop Hill Interconnection LLC, Docket No. EG12– 

24–000, ‘‘Notice of Self-Certification of Exempt 

Wholesale Generator Status’’ (Jan. 20, 2012); Maine 

GenLead LLC, Docket No. EG14–23–000, ‘‘Notice of 

Self-Certification of Exempt Wholesale Generator 

Status’’ (Jan. 24, 2014)). 

utilities had the option to seek waiver 

on a case-by-case basis.102

b. Comments 

61. Some commenters argue that it is 

common for separate ICIF-only 

companies to be created and owned by 

a generation company or an affiliate, so 

that an entity separate from the 

generation company is used to own, 

operate, and manage the ICIF.103

Further, these commenters argue that it 

is unnecessary to exclude from the 

waiver and safe harbor those entities 

that do not sell electric energy, and that 

the Commission can and should modify 

the proposal to make the waiver 

applicable to entities that only own the 

ICIF but do not sell electric energy. 

They also argue that the Commission 

routinely grants OATT waivers for such 

companies under the limited and 

discrete facilities factor.104

62. Recurrent, SEIA, and Sempra 

argue that ICIF-only companies often are 

employed when the generation project 

is developed in phases, and separate 

companies own the discrete portions of 

the generating facility that is the subject 

of a LGIA.105 SEIA states that 

establishing a separate entity can 

facilitate management of the jointlyowned ICIF, assist in establishing a 

single point of contact with the 

interconnected transmission owner and 

operator, and can facilitate the addition 

of other ICIF users.106 Sempra states that 

the ICIF-only entity structure has also 

been utilized because of tax regulations 

and other permitting considerations.107

BP Wind notes that sometimes a 

separate stand-alone entity is formed to 

own the ICIF because an RTO requests 

to have a single point of contact for 

multiple generators interconnecting at 

the same point on the grid.108

63. E.ON argues that an ICIF-only 

entity should be afforded the same 

opportunity to obtain a blanket waiver 

as entities that sell electricity because 

this type of entity only exists to 

accommodate a generator company’s 

phased access to the grid.109 Recurrent 

states that when an interconnection 

company structure is used, the physical 

arrangement is identical to where the 

same entity owns the generation and the 

ICIF—the only difference is that a 

separate entity, the interconnection 

company, owns all or a portion of the 

ICIF and no generation.110 SEIA asserts 

that the Commission should not impose 

unnecessary burdens on developers 

based on their use of this ownership 

structure.111 ITC argues that the ICIF 

owned by an ICIF-only entity will be 

functionally identical to situations 

where generators own ICIF, and the 

service is likely to be the same.112 BP 

Wind agrees that the Commission 

should ensure that ICIF-only entities are 

not precluded from being eligible for the 

proposed blanket waiver on a 

technicality, so long as the facilities are 

utilized to interconnect generating 

facilities to the transmission grid.113 BP 

Wind argues that these interconnectiononly entities, like generators that 

directly own interconnection facilities, 

do not seek to be in the transmission 

business. 

64. First Wind and Invenergy argue 

that, if the Commission does not extend 

the blanket waiver to ICIF-only entities, 

the rule would be discriminatory 

because there is no basis to distinguish 

the two types of ICIF entities other than 

corporate structure, and ICIF-only 

entities would face the undue burdens 

identified in the NOPR.114 ITC and 

MISO TOs argue that to provide a 

blanket waiver to ICIF owners that sell 

electric energy, but to require ICIF 

owners that do not sell electric energy 

to file an OATT or seek waiver thereof, 

serves no clear purpose and imposes 

precisely the same burdens and 

regulatory inefficiencies identified as 

the basis for the Commission’s NOPR, in 

a manner which discriminates against 

non-sellers of electric energy.115

65. ITC also is concerned that the 

Commission’s proposal to limit 

eligibility for the waiver may have 

unintended consequences. For example, 

given the practical burdens associated 

with the operation and maintenance of 

ICIF, ICIF owners may wish to divest 

such facilities to transmission owners 

with more experience operating these 

types of facilities, and more resources 

for meeting the reliability requirements 

of such operation. ITC argues that 

failure to extend the blanket waiver in 

such scenarios may discourage such 

transactions, thereby imposing 

reliability and operational burdens on 

generator owners who may not be 

willing or able to carry them out.116

MISO TOs quote the NOPR as stating 

that the pro forma OATT is not a good 

fit for ICIF and that these facilities do 

not typically present all the concerns 

the OATT is intended to address; MISO 

TOs assert that the same is true whether 

the ICIF owner happens to sell electric 

energy from its generating facility or 

not.117

66. Recurrent and Sempra further 

argue that the Commission has 

addressed these types of ownership 

arrangements in the context of ‘‘exempt 

wholesale generator’’ (EWG) status 

pursuant to section 32 of the Public 

Utility Holding Company Act of 2005 

(PUHCA).118 Recurrent states that the 

Commission has held that an entity that 

does not own generation facilities but 

does own a radial interconnection line 

used solely to connect wholesale-only 

generating facilities to the transmission 

grid qualifies as an EWG. Recurrent 

argues that section 32(a)(2) of PUHCA 

states that the term ‘‘eligible facility’’ 

includes interconnecting transmission 

facilities necessary to effect a sale of 

electric energy at wholesale, and that an 

entity may be an EWG if it owns ‘‘all or 

part of one or more eligible facilities.’’ 

Recurrent states that with respect to the 

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119Recurrent at 6. 

120Recurrent at 6–7. 

121Recurrent at 9–10. 

122SEIA at 5 (citing Recurrent at 9–10). 

123E.ON at 7. E.ON also offers a redline of the 

proposed regulations to effect this change. 

124Sempra at 4. 

125Sempra at 4–6. 

126First Wind at 4–8 and Invenergy at 7–11. 

Invenergy also offers a redline of the proposed 

regulations to effect this change. 

127BP Wind at 5–6. 

128NextEra at 7–9. 

129BP Wind at 7. 

130 ITC at 8. 

131We will not issue a public notice, accept 

comments, or issue an order on the informational 

filings. 

statutory requirement that an EWG ‘‘sell 

electric energy at wholesale,’’ the 

Commission has imputed the generation 

owner’s sales of wholesale power to the 

interconnection company, in order to 

satisfy the statutory requirement, in all 

of the proceedings that have addressed 

this issue.119 Recurrent argues that in 

decisions involving requests for waivers 

of OATT and related requirements, and 

in those involving EWG status, the 

Commission appropriately has not 

elevated form over substance and has 

not differentiated its regulatory 

treatment of interconnection companies 

from its treatment of a ‘‘single entity’’ 

that owns both generation and ICIF.120

67. Several commenters suggest 

potential ways to fix the section 210 

applicability issue with respect to ICIFonly entities, such that the blanket 

waiver and safe harbor would apply to 

ICIF-only companies, and section 210 

would preserve the ‘‘backstop’’ ability of 

third parties to obtain a Commission 

order requiring the ICIF-only company 

to interconnect with and provide 

transmission services to the third party. 

Recurrent proposes that the Commission 

grant the blanket waiver to an ICIF 

owner that does not sell electric energy 

if the interconnection company files a 

request for waiver that includes a 

commitment that if the Commission 

issues an order requiring the 

interconnection company to provide 

transmission services to a third party 

pursuant to section 211 of the FPA—to 

which the interconnection company is 

subject—the interconnection company 

agrees to voluntarily provide 

interconnection to the third party.121

SEIA states that it supports Recurrent’s 

proposal.122 Similarly E.ON states that 

the section 210 applicability concern 

could be alleviated by having the ICIFonly entity affirmatively submit to the 

Commission’s section 210 jurisdiction 

as a condition to being afforded the 

blanket waiver.123

68. Sempra states that, although ICIFonly entities may not sell the power 

produced by their affiliates, they are an 

indispensable part of the sales 

transaction, and are typically party to 

the interconnection agreement along 

with or as agent for the affiliated 

generator.124 Therefore, Sempra argues, 

for the purpose of section 210 

applicability, it would be appropriate to 

impute the electricity sales of an 

affiliated generator, as the Commission 

does in the EWG context, as discussed 

above, and extend that blanket waiver 

and safe harbor to the ICIF-only 

entity.125

69. First Wind and Invenergy argue 

that the Commission’s concern about 

entities not being able to use section 210 

to request interconnection service can 

be addressed by the Commission 

creating an equivalent obligation by 

regulation for requesting 

interconnection from an ICIF entity, and 

then review requests under section 210 

standards.126 Similarly, BP Wind argues 

that the Commission should revise its 

regulations so that ICIF-only entities 

that receive a request for 

interconnection service would process 

the request in accordance with 

requirements similar to those set forth 

in section 210 of the FPA.127

70. NextEra requests that the 

Commission clarify that ICIF owners 

that have authorization from the 

Commission to sell electric energy at 

market-based rates or that are EWGs are 

engaged in the sale of electric energy for 

purposes of determining application of 

the proposed waiver and application of 

section 210. NextEra argues that this 

would ensure consistency between the 

Commission’s use of similar terms and 

with Commission precedent with 

respect to EWGs.128 NextEra states that 

there may be instances in which an ICIF 

owner is not currently engaged in sales 

of electricity yet is authorized by the 

Commission to engage in such sales 

under a market-based rates tariff, so it 

should qualify as an electric utility. 

71. ITC argues that section 210(d) 

provides that the Commission may, on 

its own motion, issue an order requiring 

any action described in subsection (a)(1) 

if the Commission determines that such 

order meets the requirements of 

subsection (c). ITC interprets this to 

mean that the Commission may issue an 

interconnection order on its own 

motion, regardless of whether the ICIF 

owner qualifies as an electric utility by 

selling energy. 

72. BP Wind argues that, if the 

Commission does not allow ICIF-only 

entities to forego filing an OATT, it 

should at a minimum not require such 

companies to file an OATT with the 

Commission until after completion of 

interconnection studies by the 

interconnecting utility and the 

requesting party has committed to move 

forward with its project.129 ITC argues 

that if the Commission does not extend 

the blanket waiver to ICIF-only entities, 

the Commission should provide the 

option for ineligible entities to file a less 

burdensome and more narrowly tailored 

OATT that governs the terms of 

interconnections via the LGIP and 

LGIA.130

c. Commission Determination 

73. The proposal to limit the waiver 

to ICIF owners that also sell electricity 

was intended to prevent the creation of 

a regulatory gap and ensure that 

potential customers are not deprived of 

the ability to seek interconnection with 

ICIF as a result of the waiver of ICIF 

owners’ OATT obligation. We believe 

that the initial assessment in the NOPR 

that relatively few entities that own 

and/or operate ICIF would be excluded 

from the blanket waiver by the 

requirement that they sell electricity 

may be incorrect. We also believe that 

the value of reducing regulatory 

burdens, which is a goal of this Final 

Rule, applies equally to ICIF owners 

who sell electricity and to those that do 

not. Therefore, we conclude that we 

should extend the blanket waiver to 

ICIF owners who do not sell electricity, 

but, in doing so, we must ensure that no 

potential customers are deprived of 

their ability to seek interconnection 

with ICIF by the waiver of the ICIF 

owner’s OATT obligation. To expand 

the entities eligible for the blanket 

OATT waiver, we adopt the following 

procedure to allow ICIF-only entities to 

be eligible for the blanket OATT waiver. 

Any public utility to which the blanket 

waiver stated in section 35.28(d)(2) of 

the regulations adopted herein applies, 

but which does not sell electric energy, 

will receive the blanket waiver upon 

filing an informational statement with 

the Commission, as provided for in 

those regulations adopted herein.131 In 

the statement, the entity must declare 

that, ‘‘In order to satisfy the 

requirements for a blanket waiver as 

described in section 35.28(d)(2) of the 

Commission’s regulations, [entity] 

commits to comply with and be bound 

by the obligations and procedures 

applicable to electric utilities under 

section 210 of the FPA.’’ This 

informational statement may be brief, 

requiring only the name and contact 

information for the entity making the 

statement, and the affirmative 

declaration described in the previous 

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132A section 210 informational statement would 

remain operative if the public utility that filed it 

had a change in ownership. However, if the original 

public utility with an informational statement sold 

the facilities to a different entity, the new entity 

would have to satisfy the criteria for a waiver 

(including, for instance, not owning network 

transmission facilities), and if it does not, it would 

be subject to OATT requirements. It is the party’s 

responsibility to ensure that its regulatory filings 

are up to date. 

133NOPR, FERC Stats. & Regs. ¶ 32,701 at P 51. 

134AWEA at 14; First Wind 8–9; and Invenergy 

at 11–12. 

135NOPR, FERC Stats. & Regs. ¶ 32,701 at P 35. 

136APPA and TAPS at 27–29. 

137NCPA at 4 and SWP at 4. 

138SWP at 5. 

139ELCON at 2–3. 

sentence. These section 210 statements 

are to be filed in the following docket, 

Docket No. AD15–9–000. The 

Commission will take no action in 

response to these statements, but the 

blanket waiver will be applicable upon 

filing this informational statement. 

74. The purpose of this section 210 

statement is to create a publically 

available record of ICIF-only entities 

that are taking advantage of the blanket 

OATT waiver, and of the fact that, even 

though these entities are not electric 

utilities, they are subject to an 

application to the Commission under 

section 210 for an interconnection 

order. Through this process, our intent 

is to extend the benefits of the blanket 

OATT waiver to ICIF-only entities, 

protect the rights of potential 

interconnection customers, and 

minimize the regulatory burden to 

accomplish these goals. If an entity 

submits such a statement and later 

objects to or fails to comply with section 

210 obligations and procedures, its 

blanket waiver will be deemed to have 

been revoked.132

75. Accordingly, we are revising 

section 35.28(d)(2) of the regulations to 

incorporate this extension of the blanket 

waiver to entities that are not electric 

utilities, upon the filing of the section 

210 statement described above. The safe 

harbor protections at section 

35.28(d)(2)(ii)(B) will also be available 

to those entities eligible for the blanket 

waiver, as discussed below. 

3. Status of the Third-Party Requester 

a. Commission Proposal 

76. In the NOPR, the Commission 

stated, ‘‘To the extent that either the 

third-party requester or ICIF owner does 

not meet applicable requirements for 

purposes of sections 210 and 211, but 

where the third-party requester would 

be eligible for OATT service, the ICIF 

waiver would not apply.’’ 133

b. Comments 

77. AWEA, First Wind, and Invenergy 

argue that a public utility’s eligibility for 

the blanket waivers should not depend 

on the status of any such potential third 

party that might seek access to ICIF. 

They argue that the waiver would not 

provide the expected benefits of 

reducing risks if it would not apply in 

the circumstance of an ineligible thirdparty requester. They argue that the 

Commission does not explain how an 

ICIF owner would be expected to deal 

with requests from such a third-party 

requester. These parties argue that, if the 

Commission is concerned about this, it 

should by regulation require such 

entities to follow procedures under 

sections 210 and 211.134

c. Commission Determination 

78. We agree with commenters that 

making the applicability of the blanket 

waiver to the ICIF owner dependent on 

the status of a potential third-party 

requester would create unnecessary 

uncertainty for ICIF owners. 

Accordingly, we clarify that 

applicability of the blanket waiver will 

not depend on the status of the thirdparty requester. The applicability of the 

blanket waiver does, however, depend 

on the status of the ICIF owner or the 

ICIF owner’s willingness to file a section 

210 statement, as described above. 

4. Non-Public Utilities 

a. Commission Proposal 

79. The Commission proposed to 

grant a blanket waiver of all OATT, 

OASIS, and Standards of Conduct 

requirements to any public utility that is 

subject to such requirements solely 

because it owns, controls, or operates 

ICIF, in whole or in part, and sells 

electric energy from its generating 

facility.135 The NOPR did not specify 

how the blanket waiver would apply to 

non-public utilities. 

b. Comments 

80. APPA and TAPS state that, in the 

event the Commission modifies its 

regulations to create blanket waivers for 

public utility ICIF owners, the same 

blanket waiver and safe harbor should 

also apply to non-jurisdictional utilities 

for purposes of satisfying reciprocity 

obligations.136 APPA, TAPS, and SWP 

explain that non-public utilities are not 

directly subject to OATT, OASIS, and 

Standards of Conduct requirements, but 

are obligated to provide reciprocal 

service over transmission they own, 

operate, or control as a condition of 

taking service under a public utility’s 

OATT. APPA and TAPS state that, to 

the extent a non-public utility is subject 

to reciprocity solely because it owns, 

controls, or operates ICIF and sells 

energy from its generation facility, it 

should be able to point to any blanket 

waiver adopted by the Final Rule for 

public utilities as eliminating its 

obligation to individually file for 

‘‘limited and discrete’’ waivers to satisfy 

reciprocity obligations, thereby avoiding 

the burden on it and the Commission 

associated with such waivers. They state 

that any restrictions or safe harbors 

adopted with respect to section 210 or 

211 proceedings regarding public utility 

ICIF should also be available to such a 

non-public utility. 

81. NCPA and SWP contend that the 

Final Rule should make clear that any 

blanket waiver adopted in this 

proceeding applies to eligible public 

utilities and non-public utilities alike, 

arguing that treating similarly situated 

utilities differently in this respect would 

be unduly discriminatory.137 SWP states 

that non-public utilities may request 

waivers from these obligations 

according to the same criteria as public 

utilities. SWP also argues that there is 

no justification for conferring an 

advantage on public utilities that nonpublic utilities do not share.138

c. Commission Determination 

82. The blanket waiver made available 

to public utilities under this Final Rule 

is also available, as commenters suggest, 

to non-public utilities with a reciprocity 

obligation. 

5. Applicability to Industrial Power 

Systems’ Tie Lines 

a. Comments 

83. ELCON comments that many 

industrials own and operate combined 

heat and power systems or other types 

of generation that are primarily 

dedicated to their own consumption 

needs, and that ambiguity with the 

scope of the NOPR may arise because of 

commonly used nomenclature, because 

dedicated lines operated by industrials 

are often referred to as one type of 

‘‘generator tie line.’’ ELCON argues that 

the NOPR should be revised to clarify 

that the regulations respecting thirdparty rights to interconnection facilities, 

even as newly constrained, do not apply 

to the generator tie lines operated by 

industrials and dedicated to their own 

internal consumption.139

b. Commission Determination 

84. We decline to revise the proposed 

regulation as ELCON suggests. ELCON’s 

argument that the NOPR’s discussion of 

third-party rights to request 

interconnection and transmission on 

ICIF should not apply to electric lines 

from industrial-owned combined heat 

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17666 Federal Register / Vol. 80, No. 62 / Wednesday, April 1, 2015 / Rules and Regulations 

140 18 CFR 35.28(a). 

141NOPR, FERC Stats. & Regs. ¶ 32,701 at P 1. 

142Linden at 8. 

143Linden at 8 (citing Cogen Technologies Linden 

Venture, L.L.P., 127 FERC ¶ 61,181, at P 20 (2009)). 

144Linden at 7. 145Linden at 7–8. 146NOPR, FERC Stats. & Regs. ¶ 32,701 at P 40. 147NOPR, FERC Stats. & Regs. ¶ 32,701 at P 40. 148AWEA at 17; NextEra at 10; and Terra-Gen at 

2. 

149AWEA at 17 and Terra-Gen at 4. 

150Terra-Gen at 2. 

151NextEra at 10–11. 

152AWEA at 11. 

and power systems raises an issue that 

is not the subject of this rulemaking. 

This Final Rule does not make any 

determination with respect to the 

applicability of the Commission’s OATT 

requirements to any particular lines or 

types of lines. Rather, it applies to any 

transmission providers who are subject 

to the requirements of section 35.28 of 

our regulations, i.e., any public utility 

that owns, controls, or operates facilities 

used for the transmission of electric 

energy in interstate commerce.140

6. Applicability of the Blanket Waiver to 

Additional Regulations 

a. Commission Proposal 

85. In the NOPR, the Commission 

proposed that the blanket waiver would 

apply to section 35.28 of the 

Commission’s regulation, which relates 

to OATT requirements, Part 37, which 

relates to OASIS requirements, and Part 

358, which relates to Standards of 

Conduct for Transmission Providers.141

b. Comments 

86. Linden argues that the blanket 

waiver should be expanded to also 

apply to all of Parts 34, 35, 41, 50, 101, 

and 141 (except sections 141.14 and 

141.15) of the Commission’s regulations 

with respect to any provision of 

transmission service or interconnection 

service or other sharing with respect to 

ICIF.142 Linden contends that this is 

consistent with the Commission’s 

findings in an order on a proposed 

shared facilities agreement between 

Linden and its affiliate, in which the 

Commission found that such regulations 

are waived with respect to Linden.143

c. Commission Determination 

87. While we recognize that waiver of 

the provisions mentioned by Linden 

have, under certain circumstances, been 

granted by the Commission, we decline 

to expand the scope of this Final Rule. 

The blanket waivers granted in this 

Final Rule are the same as those that 

could be requested on a case-by-case 

basis for good cause shown in the 

Commission’s pre-existing regulations at 

18 CFR 35.28(d). Whether to grant 

additional waivers on a generic basis 

was not something proposed to be 

addressed in this proceeding. 

7. Existing Agreements and Waivers 

a. Comments 

88. Linden contends that the 

Commission should clarify that the 

blanket waiver will apply regardless of 

whether a public utility has already 

granted access to its ICIF pursuant to a 

Commission-accepted agreement. 

Linden argues that the fact that an 

owner and/or operator of ICIF has 

allowed a third-party to use its ICIF 

pursuant to a Commission-accepted 

agreement does not change the nature of 

such ICIF, and the blanket waiver 

should accordingly continue to 

apply.144 Linden states that, at the very 

least, the Commission should clarify 

that all existing waivers that have been 

granted to public utilities like Linden 

will continue to apply.145

b. Commission Determination 

89. We affirm granting access over 

ICIF via an existing agreement, such as 

a common facilities agreement or shared 

use agreement, does not affect an ICIF 

owner’s eligibility for the blanket waiver 

granted by this Final Rule. Further, we 

affirm that, if an entity has previously 

received a specific waiver of the OATT 

and related obligations pursuant to the 

Commission’s ‘‘limited and discrete’’ or 

‘‘small entity’’ standards, the blanket 

waiver will supersede the existing 

waiver.146 If, as Linden postulates, an 

entity has received a case-specific 

waiver that waives requirements in 

addition to those waived by the blanket 

waiver, the blanket waiver would not 

rescind the broader waiver. 

8. Existing OATTs 

a. Commission Proposal 

90. The Commission proposed that 

the grant of a blanket waiver would 

have no automatic impact on an OATT 

already on file or on service already 

being taken under it, but the 

Commission might on a case-by-case 

basis consider requests to withdraw an 

OATT on file for ICIF if no third party 

is taking service under it.147

b. Comments 

91. AWEA, Terra-Gen, and NextEra 

assert that an ICIF owner with an OATT 

on file should be able to withdraw its 

OATT if there are no third parties 

taking, or currently pursuing a request 

for, interconnection or transmission 

service.148 AWEA and Terra-Gen ask 

that the Commission: (1) Clarify that 

this cancellation policy will apply when 

the ICIF owner has no existing 

customers and that any new service 

requests submitted after such a filing 

has been made must proceed under 

sections 210, 211, and 212; and (2) 

provide an expedited process to grant 

such requests to withdraw such 

OATTs.149 Terra-Gen states that it 

incurred substantial costs in attempting 

to comply with the Commission’s OATT 

requirements over several years, only to 

find that it could not recover those costs 

because the customer that requested 

transmission service ultimately did not 

become a transmission customer. TerraGen argues that this experience 

underscores the importance of the 

Commission’s proposal to provide a 

case-by-case mechanism to accept 

cancellation of OATTs filed by ICIF 

owners that have proven to be 

unnecessary because no third parties are 

taking service under them.150 NextEra 

requests that the Commission clarify its 

statement in the NOPR that withdrawal 

of an OATT ‘‘if no party is taking 

service under it’’ was not intended to 

preclude the ability of an ICIF owner 

with an OATT on file from exercising its 

rights under section 205 of the FPA to 

propose alternative tariff structures in 

the future, as appropriate to the facts 

and circumstances of service available 

on the ICIF.151

92. AWEA further contends that the 

blanket waivers should also 

automatically apply to those that 

already have OATTs on file. AWEA 

states that ICIF owners that currently 

have an OATT on file are in need of the 

proposed reforms just as much as future 

ICIF owners, and argues that providing 

blanket waivers to this group as well 

would provide consistency and 

certainty to these entities.152

c. Commission Determination 

93. In the instance where an ICIF 

owner has an OATT on file and no third 

parties are taking service, the 

Commission will consider a request to 

withdraw an OATT on a case-by-case 

basis. Thus, we decline to automatically 

apply blanket waivers to those that 

already have OATTs on file. We believe 

this is appropriate in order to give any 

potential customer actively pursuing 

service sufficient notice before allowing 

a filed OATT to be withdrawn. As such, 

we decline to establish a separate 

process for cancelling existing OATTs 

because the Commission will consider 

the specific circumstances of each 

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Federal Register / Vol. 80, No. 62 / Wednesday, April 1, 2015 / Rules and Regulations 17667 

153NOPR, FERC Stats. & Regs. ¶ 32,701 at P 38. 

154Waivers of the Standards of Conduct may be 

granted for good cause pursuant to 18 CFR 358.1(d). 

155NOPR, FERC Stats. & Regs. ¶ 32,701 at P 39. 

156NextEra at 9–10; BHE at 7–8; and AWEA at 8. 

157NextEra at 10. 

158AWEA at 9. 

159BHE at 7. 

160AWEA at 9. 

161AWEA at 9–10. 

162AWEA at 10. 

163AWEA at 10. 

164AWEA at 10–11. 165AWEA at 10–11. 

request to withdraw an OATT already 

on file. 

9. Revoking the Blanket Waiver 

a. Commission Proposal 

94. In the NOPR, the Commission 

proposed that the blanket waiver would 

not be automatically revoked by a 

service request, but could be revoked in 

a Commission order if the Commission 

determines that it is in the public 

interest to do so pursuant to a 

proceeding under sections 210 and 211. 

The Commission also proposed that the 

waiver would be deemed to be revoked 

as of the date the public utility ceases 

to satisfy the qualifications for such 

waiver (e.g., it owns, controls, or 

operates transmission facilities that are 

not ICIF, or the corporate structure 

changes such that the ICIF owner is no 

longer the entity that sells electric 

energy from its Generating Facility). The 

Commission sought comment on the 

circumstances under which and the 

mechanism by which the Commission 

should revoke the proposed waiver.153

95. The Commission also proposed 

that, if an OATT waiver were revoked 

because of such a change in 

circumstances, the waivers of OASIS 

and Standards of Conduct would also be 

revoked, without prejudice to the ICIF 

owner filing a request to continue its 

waivers of OASIS and Standards of 

Conduct pursuant to the waiver criteria 

then in effect.154 In the instance where 

the Commission revokes the ICIF waiver 

by order, the Commission noted that it 

may determine whether the OASIS and 

Standards of Conduct waivers should be 

continued based on the criteria that are 

in effect.155

b. Comments 

96. NextEra, BHE, and AWEA agree 

that revocation of the blanket waiver 

should be considered on a case-by-case 

basis and believe that the processes set 

forth in sections 210 and 211 of the FPA 

and section 2.20 of the Commission’s 

regulations are sufficient to evaluate 

potential revocation of waivers granted 

to ICIF owners.156 If, for example, the 

Commission were to determine that an 

ICIF owner employed market power 

against the third party requesting 

service over the ICIF, it would be 

reasonable for the Commission to 

consider the revocation of waiver or 

other enforcement remedies.157

Similarly, AWEA asserts that the only 

plausible basis for revocation of the 

waiver, besides losing eligibility, is if an 

ICIF owner refuses to provide 

transmission access following 

proceedings under sections 210, 211, 

and 212. AWEA seeks clarification on 

what, if any, other criteria might be used 

by the Commission to determine that it 

is in the public interest to revoke such 

a waiver and requests the Commission 

to provide clear criteria for what would 

constitute a waiver revocation.158 BHE 

states that the waiver should only be 

revoked in limited circumstances, such 

as when a third party is granted access 

under sections 210 and 211 of the FPA 

or when material circumstances change 

such that the ICIF owner no longer 

satisfies the waiver qualification.159

97. AWEA states that acquisition of 

transmission facilities should not 

automatically trigger revocation of the 

blanket waiver. AWEA argues that 

service over such transmission facilities 

will be subject to applicable open access 

regulations but that ICIFs are distinct 

facilities that exist for the limited 

purpose of connecting generation to the 

grid.160

98. With respect to the revocation 

process, AWEA recommends that the 

Commission provide an ICIF owner 

with reasonable advanced notice 

detailing the reasons for potential 

revocation, and give the ICIF owner an 

opportunity to dispute and to cure the 

reasons for such a potential 

revocation.161 AWEA suggests that the 

Commission first issue a show cause 

order to the waiver holder to address 

why the waiver should not be revoked 

and provide an opportunity for the 

waiver holder to make that 

demonstration.162

99. AWEA recommends that the 

Commission outline the process to 

reinstitute an ICIF owner’s waiver if, 

after revocation of a waiver, it is 

discovered that the waiver revocation 

was unnecessary, such as, for example, 

if the requirement to file an OATT 

proves to be unnecessary because of the 

failure of the requesting third party to 

take transmission service.163

100. AWEA supports the Commission 

proposals that (1) if the OATT waiver is 

revoked, the Commission may 

determine whether the OASIS and 

Standards of Conduct waivers should 

continue to be based on the criteria in 

effect; 164 and (2) if the OATT waiver is 

revoked due to loss of eligibility, the 

OASIS and Standards of Conduct 

waivers will also be revoked without 

prejudice to the entity filing a request to 

continue the OASIS and Standards of 

Conduct waivers.165

c. Commission Determination 

101. We adopt the NOPR proposal 

that the blanket waiver would not be 

automatically revoked by a service 

request, but could be revoked in a 

Commission order if the Commission 

determines that it is in the public 

interest to do so pursuant to a 

proceeding under sections 210 and 211 

of the FPA. We also adopt the NOPR 

proposal that the waiver would be 

deemed to be revoked as of the date the 

public utility ceases to satisfy the 

qualifications for such waiver. 

Additionally, if the ICIF that are covered 

by a blanket waiver become integrated 

into a transmission system such that 

they can no longer be considered ICIF, 

the blanket waiver would be deemed to 

have been revoked. To the extent that a 

dispute arises regarding whether a 

facility is eligible for the waiver, the 

Commission will address such a dispute 

at that time. 

102. If the OATT waiver is 

automatically revoked because of a 

change in circumstances, we affirm that 

the waivers of OASIS and Standards of 

Conduct would also be revoked, without 

prejudice to the ICIF owner filing a 

request to continue its waivers of OASIS 

and Standards of Conduct pursuant to 

the waiver criteria then in effect. 

103. We decline to elaborate on the 

specific circumstances that would lead 

to the revocation of the blanket waiver 

other than ceasing to satisfy the 

qualifications for such waiver, because 

it is not possible to anticipate every 

circumstance that would result in a 

revocation. Revocation of the blanket 

waiver in circumstances other than 

ceasing to satisfy the qualifications for 

such waiver will be determined by the 

Commission under applicable statutory 

and regulatory provisions. Any instance 

of revocation, however, would be the 

result of a Commission proceeding, so 

the ICIF owner would have notice of the 

revocation and full due process rights to 

respond. Moreover, under sections 210 

and 211 the Commission may direct 

service to be provided under an 

interconnection and transmission 

service agreement without directing that 

the ICIF owner file an OATT. However, 

the Commission reserves the right to 

revoke the blanket waiver and require 

the filing of an OATT to ensure open 

access in appropriate circumstances. 

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17668 Federal Register / Vol. 80, No. 62 / Wednesday, April 1, 2015 / Rules and Regulations 

166 16 U.S.C. 824i(a)(1)(A). 

167 16 U.S.C. 796(22). 

168 16 U.S.C. 824j. 

169 16 U.S.C. 796(23). 

170Tres Amigas LLC, 130 FERC ¶ 61,205, at P 43, 

reh’g denied, 132 FERC ¶ 61,232 (2010). In Laguna 

Irrigation District, the Commission explained that 

‘‘[n]othing in our [section 210] interconnection 

order requires transmission service. Rather, 

transmission service will be obtained by Laguna 

pursuant to other transmission tariffs or 

agreements.’’ 95 FERC ¶ 61,305, at 62,038 (2001), 

aff’d sub nom. Pacific Gas & Electric Co. v. FERC, 

44 Fed. Appx. 170 (9th Cir. 2002) (unpublished); 

see also City of Corona, California v. Southern 

California Edison Co., 104 FERC ¶ 61,085, at PP 7– 

10 (2003) (Corona’s application under section 210 

did not constitute a request for transmission under 

section 211). 

171See Aero Proposed Order, 115 FERC ¶ 61,128. 

172 16 U.S.C. 824i(c); Aero Proposed Order, 115 

FERC ¶ 61,128 at PP 15–16. 

173See 16 U.S.C. 824j(a) (‘‘No order may be issued 

under this subsection unless the 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.’’); 18 CFR 2.20. 

174 16 U.S.C. 824k(c)(2); Aero Proposed Order, 

115 FERC ¶ 61,128 at PP 17–18 (providing parties 

28 days to negotiate and provide briefing on issues 

of disagreement). 

175NOPR, FERC Stats. & Regs. ¶ 32,701 at P 41. 

176NOPR, FERC Stats. & Regs. ¶ 32,701 at P 47. 

177 16 U.S.C. 824i(a)(1)(D) (‘‘The Commission may 

issue an order requiring . . . such increase in 

transmission capacity as may be necessary. . . .’’); 

16 U.S.C. 824j(a) (‘‘Any electric utility . . . may 

apply to the Commission for an order under this 

subsection requiring a transmitting utility to 

provide transmission services (including any 

enlargement of transmission capacity necessary to 

provide such services) to the applicant.’’). 

178Section 212(a) provides that an order under 

section 211 shall require the transmitting utility 

subject to the order to provide wholesale 

transmission services at rates, charges, terms, and 

conditions which permit the recovery by such 

utility of all the costs incurred in connection with 

the transmission services and necessary associated 

services, including, but not limited to, an 

appropriate share, if any, of legitimate, verifiable 

and economic costs, including taking into account 

any benefits to the transmission system of providing 

the transmission service, and the costs of any 

enlargement of transmission facilities. 

179Section 15.4 of the pro forma OATT states that 

f the Transmission Provider determines that it 

cannot accommodate a Completed Application for 

Firm Point-To-Point Transmission Service because 

of insufficient capability on its Transmission 

System, the Transmission Provider will use due 

diligence to expand or modify its Transmission 

C. Interconnection and Transmission 

Under Sections 210 and 211 of the 

Federal Power Act 

1. Sections 210 and 211 

104. Sections 210 and 211 of the FPA 

describe the process for seeking 

Commission-ordered interconnection 

and transmission services. Section 210 

of the FPA provides, in relevant part, 

‘‘Upon application of any electric utility 

. . . the Commission may issue an order 

requiring (A) the physical connection of 

. . . the transmission facilities of any 

electric utility, with the facilities of 

such applicant.’’ 166 An ‘‘electric utility’’ 

is defined as ‘‘a person or Federal or 

State agency . . . that sells electric 

energy.’’ 167 Section 211 provides that 

‘‘any electric utility, Federal power 

marketing agency, or any other person 

generating electric energy for sale or 

resale’’ may apply to the Commission 

for an order requiring a ‘‘transmitting 

utility’’ to provide transmission 

services, including enlargement of 

facilities if necessary.168 The term 

‘‘transmitting utility’’ is defined as an 

entity that ‘‘owns, operates, or controls 

facilities used for the transmission of 

electric energy . . . in interstate 

commerce . . . for the sale of electric 

energy at wholesale.’’ 169 For a third 

party to obtain interconnection services 

and transmission services, an 

application must be made under both 

sections 210 and 211.170 An applicant 

may consolidate the applications for the 

Commission’s consideration.171

105. An application under section 210 

must show that the interconnection: (1) 

Is in the public interest; (2) would either 

encourage conservation of energy or 

capital, optimize efficient use of 

facilities and resources, or improve 

reliability; and (3) meets the 

requirements of section 212.172 The 

requirements of section 212 are 

discussed further below. 

106. An application under section 211 

requires that the third party seeking 

transmission service first make a good 

faith request for service, complying with 

18 CFR 2.20, specifying details as to 

how much capacity is requested and for 

what period, at least 60 days before 

making an application to the 

Commission for an order requiring 

transmission service.173 The 

Commission may grant an application 

under section 211 if the application is 

in the public interest and otherwise 

meets the requirements under section 

212. 

107. Section 212 further requires that, 

before issuing a final order under either 

section 210 or 211, the Commission 

must issue a proposed order setting a 

reasonable time for the parties to agree 

to terms and conditions for carrying out 

the order, including allocation of costs. 

If parties can agree to terms within that 

time, the Commission may issue a final 

order approving those terms. If parties 

do not agree, the Commission will 

weigh the positions of the parties and 

issue a final order establishing the terms 

of costs, compensation, and other terms 

of interconnection and transmission and 

directing service.174

a. Commission Proposal 

108. The Commission proposed in the 

NOPR that, if a third party seeks to use 

ICIF that qualify for the blanket waiver 

discussed above, an eligible entity 

seeking interconnection and 

transmission service on ICIF would 

need to follow the rules and regulations 

applicable to requests for service under 

sections 210 and 211 (subject to the safe 

harbor presumption proposed in the 

NOPR).175

109. As discussed above, the 

Commission’s current practice with 

respect to allowing an ICIF owner to 

have priority use of excess transmission 

capacity it has built is to allow the ICIF 

owner to demonstrate specific plans and 

milestones for any planned future 

generation development by the ICIF 

owner or its affiliates. Consistent with 

that practice, the Commission proposed 

in the NOPR to find that, outside of the 

safe harbor period and to the extent the 

ICIF owner can demonstrate specific 

plans and milestones for its and/or its 

affiliates’ future use of the ICIF, with 

respect to ICIF that are eligible for the 

blanket waiver discussed above, it is 

generally in the public interest under 

sections 210 and 211 to allow an ICIF 

owner to retain priority rights to the use 

of excess capacity on ICIF that it plans 

to use to interconnect its own or its 

affiliates’ future generation projects.176

Thus, the Commission proposed to 

make priority determinations for use of 

ICIF, in the event of a third party 

request, in the process under sections 

210 and 211. The Commission sought 

comment on whether an ICIF owner’s or 

affiliate’s planned future use of the ICIF 

is an appropriate consideration to factor 

into a proceeding under sections 210 

and 211. 

110. Any disputes as to the extent of 

excess capacity on ICIF or the ICIF 

owner’s future plans to use such excess 

capacity would be resolved, subject to 

the safe harbor presumption discussed 

below, during the proceedings under 

sections 210 and 211, using an excess 

capacity analysis similar to that used in 

Aero and Milford, in which the ICIF 

owner must demonstrate specific plans 

and milestones for the future use of its 

ICIF. Even if an ICIF owner were able to 

demonstrate in such a proceeding that 

no excess capacity exists, if supported 

by the record in the case, the 

Commission could order the eligible 

ICIF owner to expand its facilities to 

provide interconnection and 

transmission service under sections 210 

and 211.177 Section 212 requires that the 

eligible ICIF owners would be fully 

compensated for any required 

expansion.178 This is similar to the 

rights and obligations under the pro 

forma OATT.179

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Federal Register / Vol. 80, No. 62 / Wednesday, April 1, 2015 / Rules and Regulations 17669 

System to provide the requested Firm Transmission 

Service, consistent with its planning obligations in 

Attachment K, provided the Transmission Customer 

agrees to compensate the Transmission Provider for 

such costs pursuant to the terms of Section 27. 

180Recurrent at 4; Southern at 7; NextEra at 11– 

14; AWEA at 12–13; BHE at 8; and EEI at 16. 

181NextEra at 11–14 and BHE at 8. 

182NextEra at 11–14. 

183NextEra at 11–14 and AWEA at 12–13. 

184APPA and TAPS at 11–12. 

185APPA and TAPS at 12 (citing to Order No. 

888, FERC Stats. & Regs. ¶ 31,036 at 31,646). 

186APPA and TAPS at 24–25. 

187NRECA at 5. 

188APPA and TAPS at 20–21. 

189Such third-party requests for service could 

include requests for firm, nonfirm, conditional, or 

interim service. See, e.g., 18 CFR 2.20(b)(9). 

190See supra P 38. 

191First Wind at 15 and Invenergy at 14–15. 

192Linden at 4–5. 

b. Comments 

111. Most commenters support the 

NOPR proposal that third parties 

seeking to use ICIF subject to the 

blanket waiver should do so pursuant to 

sections 210 and 211. AWEA, BHE, EEI, 

NextEra, Recurrent, and Southern argue 

that this approach will protect the ICIF 

owner from speculative requests for 

transmission service.180 NextEra and 

BHE further argue that the requirements 

of sections 210 and 211 also protect the 

interests of third parties seeking to use 

ICIF.181 NextEra and Southern also 

support the NOPR’s proposal to 

evaluate, in the course of a proceeding 

under sections 210 and 211, whether an 

ICIF owner’s ‘‘specific plans and 

milestones’’ justify priority rights to use 

excess capacity on the ICIF, to the 

extent the safe harbor is not 

applicable.182 Finally, NextEra and 

AWEA contend that the framework 

under sections 210 and 211 provides the 

flexibility necessary for ICIF owners and 

third parties to reach mutually agreeable 

arrangements tailored to their respective 

needs.183

112. APPA and TAPS argue that the 

NOPR, as proposed, would erect an 

impassable barrier to accessing ICIF. 

APPA, TAPS, and NRECA argue that a 

proceeding under sections 210 and 211 

is time-consuming, burdensome, and 

expensive.184 They state that Order No. 

888 expressly found those statutory 

processes to be too cumbersome and 

time-consuming to provide nondiscriminatory access and placed 

customers ‘‘at a severe disadvantage 

compared to the transmission 

owner.’’ 185 They contend that by 

limiting requesters to access only 

through sections 210 and 211, even if 

the request is received many years after 

the ICIF is energized and there is ample 

unused capacity, the NOPR creates a 

potent and permanent obstacle to open 

access that enhances the ICIF owner’s 

vertical market power without any 

justification.186 NRECA argues that 

prospective customers should not have 

to initiate such a proceeding with the 

Commission in order to demonstrate 

entitlement to service on these 

Commission-jurisdictional lines.187

APPA and TAPS also contend that the 

NOPR has not demonstrated that the 

proposed procedures will cost less than 

existing requirements, arguing that the 

lengthy and costly procedures of 

sections 210 and 211 could not possibly 

be less expensive for ICIF owners on an 

industry-wide basis.188

c. Commission Determination 

113. We find that with respect to ICIF 

eligible for the blanket waiver discussed 

above, it is appropriate for entities 

seeking interconnection and 

transmission service on ICIF to follow 

the rules and regulations applicable to 

requests for service under sections 210 

and 211 (subject to the safe harbor 

discussed below).189 Given the risk of 

investment in generation and ICIF, it is 

appropriate to provide an ICIF owner 

with priority rights over the use of the 

excess capacity on ICIF that it plans to 

use to interconnect its own or its 

affiliates’ future generation projects to 

the extent the ICIF owner can 

demonstrate specific plans and 

milestones for its and/or its affiliates’ 

future use of the ICIF. In addition, we 

find that given the relatively small 

percentage of ICIF owners that have 

actually had to file an OATT,190

requiring the entity requesting service 

over ICIF to pursue such service under 

sections 210 and 211 will not overly 

burden potential customers of service 

on ICIF. The process under sections 210 

and 211 assures third-party entities 

requesting service on ICIF and eligible 

ICIF owners alike that they will have 

specified procedural rights as set forth 

in sections 210, 211, and 212 of the FPA 

and appropriately balances ICIF owners’ 

and third parties’ rights to service on 

ICIF. Further, this framework provides 

the contractual flexibility that some 

commenters suggest is not available 

under our existing policy so that 

contractual arrangements (e.g., 

transmission service agreements, 

interconnection agreements, and/or 

shared facilities agreements) can be 

tailored to the special situations for ICIF 

in determining the appropriate terms 

and conditions of service, as many of 

the pro forma OATT provisions are not 

applicable to service over ICIF. Finally, 

we recognize that our existing policy to 

allow an ICIF owner to retain priority 

rights if it has plans to use the ICIF 

capacity and is making progress to 

achieve those plans can involve a 

potential transmission or 

interconnection customer in complex 

proceedings associated with a request 

for service. Thus, we believe the reforms 

adopted herein will not meaningfully 

change the expense potential customers 

incur to obtain service. 

114. APPA and TAPS are correct that 

the Commission in Order No. 888 found 

section 211 to provide insufficient relief 

as a general method of enabling more 

competitive generation to obtain open 

access transmission service. As a result, 

Order No. 888 required that public 

utilities file an OATT to provide readily 

available, comparable service at known 

rates, terms, and conditions. In this 

Final Rule, the Commission finds that 

the filing of an OATT and compliance 

with certain regulations are not 

necessary to prevent unjust and 

unreasonable rates or unduly 

discriminatory behavior with respect to 

ICIF. ICIF are sole-use, limited and 

discrete, radial in nature, and not part 

of an integrated transmission network, 

and third-party requests to use ICIF are 

infrequent. Case-by-case determinations 

under sections 210 and 211 are not 

appropriate for the large number of 

transmission service requests on the 

integrated grid, but are appropriate for 

the few expected requests for service on 

ICIF, each of which would likely have 

different circumstances. We find that, 

for this set of circumstances, the 

framework of sections 210 and 211 

provide a sufficient means for thirdparty access to ICIF. 

2. Voluntary Arrangements 

a. Comments 

115. First Wind and Invenergy ask the 

Commission to confirm that ICIF owners 

may continue to enter into shared use 

agreements with affiliates without 

requiring the affiliated party to utilize 

sections 210, 211 and 212 to obtain 

access.191 Similarly, Linden requests 

that the Commission clarify that the 

Commission’s proposed process does 

not preclude an ICIF owner and a nonaffiliated entity seeking service to 

mutually agree upon an appropriate 

arrangement outside of the context of a 

proceeding under sections 210 or 211, if 

the parties file any resulting mutually 

agreed upon arrangement pursuant to 

section 205 of the FPA.192 Linden 

contends that the new proposed section 

35.28(d)(2)(ii) suggests that the parties 

must use the process before the 

Commission that is outlined in sections 

210, 211, and 212 of the FPA and the 

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193Linden at 5. 

194Linden at 5–6. 

195Linden at 6–7. 

196E.ON at 13. 

197NRG at 3–4 and E.ON at 13. 198See 16 U.S.C. 824k(c)(1). 

199NextEra at 14–15. 

200AWEA at 16–17. 

201AWEA at 17. 

202MISO at 7 and MISO TOs at 5. 

203MISO at 5–6 and MISO TOs at 4–5. 

Commission’s corresponding 

regulations. Linden asserts that even 

where sections 210 and 211 apply, 

section 212(c)(1) of the FPA requires 

that the Commission ‘‘set a reasonable 

time for parties . . . to agree to terms 

and conditions under which such order 

is to be carried out’’ and that the 

Commission generally directs the 

parties to negotiate appropriate 

agreements.193 Accordingly, Linden 

recommends that the Commission 

should consider revising section 

35.28(d)(2)(ii) to explicitly allow for the 

possibility that parties may arrive at 

mutually agreeable arrangements 

without undergoing a proceeding under 

sections 210 and 211 at the 

Commission.194 Linden further states 

that parties to the relevant arrangements 

should be allowed flexibility to 

negotiate appropriate terms and 

conditions without restriction as to the 

form or nature of the agreement for 

greater regulatory efficiency, and 

recommends that the Commission add 

an additional section 35.28(iii) 

explicitly acknowledging that parties 

may mutually agree on rates, terms and 

conditions, subject to Commission 

review and acceptance.195

116. E.ON asks the Commission to 

clarify that the blanket waiver should 

not be jeopardized if a planned phase of 

a generation project is owned by a nonaffiliate.196 Similarly, NRG and E.ON 

ask for clarification that voluntarily 

negotiating a bilateral agreement with a 

third party that is seeking access to the 

ICIF during the safe harbor period, 

discussed below, would not jeopardize 

the continuation of the safe harbor 

period.197

b. Commission Determination 

117. We clarify that the availability of 

the process under sections 210 and 211 

does not preclude the opportunity for an 

ICIF owner and an entity seeking 

service, including an affiliate, to 

mutually agree, outside of the process 

under sections 210 and 211, to an 

arrangement for service over the ICIF. In 

fact, this flexibility benefits both the 

ICIF owner and an entity seeking 

service, as it allows the parties the 

opportunity to craft an agreement 

appropriate for the circumstances and 

potentially expedite access to ICIF. In 

that case, availability of the process 

under sections 210 and 211 provides 

protection to entities seeking service by 

allowing them to seek service under the 

process under sections 210 and 211 if an 

agreement cannot be reached. 

Furthermore, we likewise clarify that 

this flexibility applies both to affiliates 

and non-affiliates of the ICIF owner, 

such that ICIF owners may enter into 

shared use agreements with affiliates or 

non-affiliates, without requiring a 

proceeding under sections 210 and 211 

to obtain access. Finally, we clarify that 

a shared-use agreement or bilateral 

agreement with either an affiliate or 

non-affiliate will not in itself jeopardize 

the applicability of the blanket waiver 

or the continuation of the safe harbor 

period, discussed below. We find that 

this will allow flexibility and promote 

mutually agreeable arrangements for 

sharing facilities. In any case, ICIF 

owners that are public utilities would 

still be subject to the statutory 

requirement of sections 205 and 206 

forbidding unduly discriminatory 

practices. 

118. We agree that our use of the term 

‘‘shall’’ in new section 35.28(d)(2)(ii) 

may have inadvertently given the 

impression that voluntary agreements 

without resort to sections 210 and 211 

were not allowed. We did not intend 

that, and therefore change the word 

‘‘shall’’ to ‘‘may’’ in section 

35.28(d)(2)(ii). Indeed, the flexibility to 

enter into voluntary agreements is 

inherent in the process under sections 

210 and 211. As Linden points out, 

section 212 recognizes that parties 

should have a reasonable time to agree 

to terms and conditions,198 and section 

211 requires that a third party must 

have submitted a good faith request for 

service at least 60 days before it may 

submit a section 211 application before 

the Commission. Nothing in sections 

210 or 211 precludes entities from 

arriving at mutual agreements prior to or 

instead of seeking to establish a process 

under sections 210 and 211. 

Accordingly, we confirm that an ICIF 

owner and an entity seeking service may 

mutually agree to an arrangement for 

interconnection and transmission 

service over the ICIF, without initiating 

a process under sections 210 and 211. 

3. Interaction With the Transmission 

System 

a. Comments 

119. AWEA states that a third party 

requesting service on an ICIF should be 

required to submit an appropriate 

interconnection or transmission service 

request to the transmission provider 

with whom the ICIF are interconnected 

within 30 days of the good faith request 

to the owner of the ICIF and/or within 

a reasonable time before an application 

under sections 210 and 211 is made. 

NextEra argues for a similar 

requirement, stating that the third party 

should make a request to the 

transmission provider within 60 days 

following the completion of a feasibility 

study by the ICIF owner in order for a 

subsequent petition under sections 210 

or 211 of the FPA to be considered in 

good faith.199 AWEA explains that, even 

if the proposed reforms were put into 

place, failing to require such a submittal 

could lead to gaming opportunities by 

unaffiliated generators who may wish to 

establish a queue position on an ICIF, 

while avoiding upfront costs associated 

with actually injecting power into a 

transmission provider’s network grid.200

AWEA argues that it is reasonable to 

make such a requirement because it is 

critical for system reliability that all 

three of the relevant parties are involved 

in any interconnection of new 

generation to the grid.201

120. MISO and the MISO TOs suggest 

that the Commission should require the 

new interconnection customer who 

requests to interconnect to the existing 

ICIF to enter into an agreement with the 

existing interconnection customer 

before allowing the new interconnection 

customer to enter the binding portion of 

the governing interconnection 

procedures.202 They argue this is 

reasonable because adding generating 

facilities to existing ICIF will complicate 

the existing interconnection process and 

require coordination with the relevant 

RTO or the use of existing RTO 

interconnection procedures to ensure 

that new interconnections to ICIFs will 

not adversely impact the reliable 

operation of the transmission system.203

121. While ITC does not oppose the 

reforms proposed in the NOPR, ITC is 

concerned that the Commission’s 

proposal to rely exclusively on sections 

210 and 211 of the FPA to govern thirdparty interconnections on ICIF fails to 

provide sufficient clarity on the precise 

contractual relationship that will exist 

between the ICIF owner, a third party 

proposing to interconnect with ICIF, the 

transmission provider, and the impacted 

transmission owner (provided these are 

separate entities). ITC recommends that 

the Commission provide additional 

guidance in the Final Rule on the 

process for establishing contractual 

relationships between these four types 

of parties, the nature of these 

contractual relationships, and how 

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204 ITC at 7–8. 

205 ITC at 11. 

206MISO TOs at 5. 

207EEI at 16–17. 

208Southern at 7–8. 

209 In addition, an application under section 211 

requires that the third party seeking transmission 

first make a good faith request for service, 

complying with 18 CFR 2.20, specifying details as 

to how much capacity is requested and for what 

period, at least 60 days before making an 

application to the Commission for an order 

requiring transmission service. The Commission 

may grant an application under section 211 if the 

application is in the public interest and otherwise 

meets the requirements under section 212. As part 

of the evaluation of whether the third party seeking 

transmission service made a good faith request for 

service, the Commission may look to see what 

measures, if any, the third party has taken to 

acquire service on the network transmission system 

beyond the ICIF. 210NOPR, FERC Stats. & Regs. ¶ 32,701 at P 35. 

successful applications will fit into the 

relevant transmission provider study 

processes necessary to ensure that such 

connections occur safely and reliably. 

Specifically, ITC recommends that the 

Commission include in the Final Rule 

requirements that: (1) Interconnection 

requests approved under sections 210 

and 211 must proceed under the LGIP 

of the transmission provider to which 

the ICIF owner is interconnected; and 

(2) the third party must enter into a 

separate LGIA with the impacted 

transmission owner and facilities 

agreement with the ICIF owner.204

Given that the transmission owner owns 

and operates facilities to which the 

shared ICIF are interconnected, the third 

party should be required to enter into an 

LGIA with the impacted transmission 

owner. This will clearly establish the 

rights and obligations of all parties and, 

more importantly, ensure that the 

appropriate reliability studies are 

conducted prior to allowing an 

interconnection.205 The MISO TOs agree 

with ITC that the Commission should 

modify its NOPR proposal to require 

greater coordination with the 

transmission provider and transmission 

owner because this will lessen the 

likelihood of operational and reliability 

problems while lessening the OATT, 

OASIS, and Standards of Conduct 

burdens on ICIF owners that the 

Commission seeks to alleviate.206

122. Similarly, EPSA recommends 

that the Commission should encourage 

parties to utilize appropriate existing 

LGIA and LGIP provisions regarding 

terms, conditions and procedures in the 

Final Rule because the provisions of the 

LGIA and LGIP (e.g., section 9.9.2 of the 

LGIA) work well for the interconnection 

process and that augmenting the process 

under sections 210, 211 and 212 with 

these procedures will offer clarity to 

industry stakeholders. 

123. EEI requests that the Commission 

not be prescriptive with respect to a 

mechanism for interconnection or 

transmission under this rule, and states 

that under the framework under 

sections 210 and 211, the ICIF owner, 

the eligible entity seeking 

interconnection to the ICIF and the 

transmission provider will have 

flexibility on how to develop the terms 

and conditions of the interconnection to 

the ICIF and any associated 

transmission delivery service over the 

ICIF.207

124. Southern asserts that the ICIF 

owner, the party seeking 

interconnection to the ICIF, and the 

transmission provider should have the 

flexibility to develop appropriate 

arrangements for both interconnection 

and transmission service that meet all 

parties’ needs so long as the new 

interconnection customer is able to 

interconnect its generating facility and 

acquire transmission service on terms 

and conditions that are similar to other 

customers. Therefore, Southern 

contends, the Commission should not 

be prescriptive with respect to the 

mechanism to be used for 

interconnection or transmission service 

under this rule as long as all affected 

parties agree to jointly study and 

provide interconnection and 

transmission service for the new 

generator requesting interconnection, 

with the new generator’s commitment to 

bear the expense of such work. 

Moreover, Southern notes that the 

Commission would retain oversight over 

the third-party requests for service over 

the ICIF because it would have an 

opportunity to review such 

arrangements under FPA sections 210, 

211 and 212 and amendments to 

existing interconnection agreements 

under section 205.208

b. Commission Determination 

125. Commenters appear to be 

conflating the scope of this Final Rule— 

access to ICIF—with requirements for 

access to the network/integrated grid. 

As such, we decline to prescribe 

additional requirements for access to the 

network/integrated transmission system 

by entities seeking to interconnect with 

ICIF or a process for how requests to 

interconnect with ICIF must fit into the 

transmission provider’s study processes. 

We reaffirm the existing policy that 

third-party requesters are obligated to 

obtain service on the transmission 

facilities at or beyond the Point of 

Change of Ownership as well as those 

facilities beyond the Point of 

Interconnection with ICIF pursuant to 

the relevant existing OATT and 

interconnection procedures.209 The 

existing policy, under which third-party 

requesters are obligated to obtain service 

on the transmission facilities beyond the 

ICIF pursuant to the relevant existing 

OATT and interconnection procedures, 

will maintain the reliability of the 

network transmission system by 

ensuring that the appropriate studies are 

conducted. At the same time, the 

Commission’s existing policy provides 

the flexibility for the entity seeking 

interconnection to the ICIF, the ICIF 

owner, and the public utility 

transmission provider to develop 

arrangements for the interconnection to 

the ICIF and any associated 

transmission delivery service over the 

ICIF. 

126. In response to AWEA’s assertion 

that failing to require a third party 

seeking service on ICIF to submit an 

interconnection or transmission service 

request to the transmission provider 

with whom the ICIF are interconnected 

could lead to gaming opportunities by 

unaffiliated generators, we find that the 

process under sections 210 and 211 will 

limit speculative requests for 

transmission service from the ICIF 

owner and deter attempts to game the 

interconnection process. We are not 

persuaded that additional protection is 

needed at this time. The framework 

under sections 210 and 211 assures that 

ICIF owners have specified procedural 

rights as set forth in sections 210 and 

211 of the FPA. 

127. We conclude that the existing 

policy, that third-party requesters are 

obligated to obtain service on the 

transmission facilities at or beyond the 

Point of Change of Ownership as well as 

those facilities beyond the Point of 

Interconnection pursuant to the relevant 

OATT and interconnection procedures, 

strikes the right balance between 

ensuring reliability, providing 

flexibility, and protecting the rights of 

the ICIF owner. Accordingly, we decline 

to further prescribe how a third-party 

seeking service over ICIF pursuant to 

sections 210 and 211 also gains access 

to the networked transmission 

provider’s transmission system. 

4. Scope of Regulations To Be Modified 

a. Commission Proposal 

128. In the NOPR, the Commission 

proposed to add subsection 35.28(d)(2) 

to the Commission’s regulations for the 

purpose of setting forth the terms of the 

blanket OATT waiver, and did not 

propose to revise other regulations.210

b. Comments 

129. E.ON argues that section 2.20 of 

the Commission’s regulations, which 

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211E.ON at 13–14. 

212E.ON at 14. 

213See 18 CFR 2.20(c)(1) and 18 CFR 

2.20(c)(4)(iii). 

214 ITC at 11–12. 

215AWEA at 5; BHE at 3; BP Wind at 4; E.ON at 

10; EEI at 4; EPSA at 6; ELCON at 2–3; First Wind 

at 2; Invenergy at 2; NextEra at 6; NRG at 3; 

Recurrent at 3; Sempra at 2; SEIA at 3; Southern at 

6; and Terra-Gen at 4. 

216APPA and TAPS at 14–15. 

217NRECA at 7. 

218NRECA at 8. 

implements the section 211 process 

with respect to making and responding 

to ‘‘good faith’’ requests for transmission 

services, should be amended as to its 

applicability to ICIF because an ICIF 

owner cannot fulfill all of the 

requirements of a traditional 

transmission provider in that regulation. 

For example, section 2.20 requires the 

transmitting utility to respond to the 

requester with a date by which a 

response will be sent to the requester 

and a statement of any fees associated 

with responding to its request (e.g., 

initial studies), and if the transmitting 

utility determines it cannot provide the 

requested service with existing capacity, 

then it must provide studies and data 

regarding constraints and offer an 

executable agreement wherein the 

requester agrees to reimburse the 

transmitting utility for all costs of 

performing any studies.211 E.ON argues 

that the Commission should clarify that 

the section 2.20 process requires the 

third-party requester to arrange and pay 

for all required studies with the ICIF’s 

transmission provider, and that the ICIF 

owner has no obligation to arrange and 

pay for all such studies. E.ON argues 

that this would encompass impacts on 

the ICIF, interconnecting transmission 

owner’s interconnection facilities and 

transmission facilities, the transmission 

provider’s grid and any other affected 

entities’ facilities.212

c. Commission Determination 

130. We see no reason to revise 

section 2.20 of our regulations. We do 

not expect the ICIF owner to study the 

networked transmission system, but 

only to study the capacity available on 

its ICIF. Further, we believe that section 

2.20 is clear that the requesting party 

pays for any studies associated with a 

request for service over ICIF.213 Given 

the nature of the study to determine 

available capacity on the ICIF (typically 

by comparing the thermal rating of the 

facilities to the existing commitments 

on the line) and that the ICIF owner 

should have the information necessary 

to perform such studies, this is likely to 

be a fairly straightforward process that 

is best performed by the ICIF owner. 

Accordingly, the transparency and 

timing requirements of section 2.20 

should not prove overly burdensome for 

ICIF owners and do not require revision. 

5. Reliability Standards 

a. Comments 

131. ITC requests that the 

Commission clarify how the proposed 

interconnection process interacts with 

the requirements of NERC Reliability 

Standard FAC–001–1 (Facility 

Connection Requirements).214 This 

standard applies to all transmission 

owners and those generator owners that 

have an executed agreement to evaluate 

the reliability impact of interconnecting 

a third party facility to the generator 

owner’s existing facility that is used to 

interconnect to the interconnected 

transmission systems. 

b. Commission Determination 

132. We clarify that nothing in this 

Final Rule changes the requirement to 

comply with all Commission-approved 

mandatory Reliability Standards, 

including FAC–001–1. 

D. Safe Harbor 

1. Whether and To What Extent There 

Should be a Safe Harbor Period 

a. Commission Proposal 

133. To reduce risks to ICIF owners 

eligible for the blanket waiver discussed 

above during the critical early years of 

their projects, the Commission proposed 

a safe harbor period of five years during 

which there would be a rebuttable 

presumption that: (1) The eligible ICIF 

owner has definitive plans to use its 

capacity without having to make a 

demonstration through a specific plans 

and milestones showing; and (2) the 

eligible ICIF owner should not be 

required to expand its facilities. A thirdparty requester for service on ICIF 

during the safe harbor period could 

attempt to rebut these presumptions, but 

it would have the burden of proof to 

show that the owner and/or operator 

does not have definitive plans to use its 

capacity and the public interest under 

sections 210 and 211 is better served by 

granting access to the third party than 

by allowing the eligible ICIF owner to 

reserve its ICIF capacity for its own 

future use. 

b. Comments 

134. Many commenters 215 support 

the proposed safe harbor period, during 

which a developer of a generator tie line 

would be presumed to have priority 

rights to the capacity on the generator 

tie lines it funded for five years from the 

date the line is energized. However, a 

few commenters oppose the safe harbor, 

and a few others argue it should be 

strengthened. 

135. APPA and TAPS argue that the 

NOPR’s proposed safe harbor cuts back 

on the relief otherwise available under 

sections 210, 211, and 212, and all but 

ensures absolute foreclosure of 

competitors from access to ICIF.216 They 

explain that in order to rebut the 

presumptions, a requester would have 

the burden of proof to show that the 

ICIF owner lacks definitive plans to use 

its capacity, and that the public interest 

under sections 210 and 211 is better 

served by granting access to the third 

party than by allowing the ICIF owner 

to reserve its ICIF capacity for its own 

future use. They contend that the 

proposed presumption is effectively 

irrebuttable because the Commission’s 

determinations as to whether the ICIF 

owner and its affiliates have definitive 

plans have been based on confidential 

demonstrations available only to the 

ICIF owner and its affiliates. They note 

that the bar on any ‘‘expansion’’ during 

the safe harbor period may also 

foreclose all interconnections, even if 

the definitive plans presumption were 

somehow surmounted, because while 

the NOPR does not define the term 

‘‘expansion,’’ modifications to the ICIF 

owner’s facilities will be necessary in 

any interconnection of a competitor’s 

generator. 

136. NRECA argues that the 

Commission should not implement its 

proposed safe harbor creating a 

rebuttable presumption against 

transmission access for five years in 

cases where the customer requesting 

service on the ICIF needs it to serve load 

efficiently.217 NRECA states that load 

has little or minimal impact on the 

available capacity of ICIF, and, in many 

cases may actually increase the 

capability of ICIF with counterflow. 

NRECA states that the burden of proof 

should be on the ICIF owner to 

demonstrate that it has specific plans to 

use the transmission capacity in such a 

way that would prevent it from 

providing access to a load-serving 

transmission customer, adding that the 

Commission cannot reasonably require a 

prospective customer to prove a 

negative—that the owner has no such 

plans—when all of the relevant 

information is in the hands of the 

owner.218 NRECA also argues that the 

Commission has not provided any 

justification for granting a five-year 

presumption against requiring an ICIF 

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219NRECA at 8 (citing 16 U.S.C. 824i(a)(1) 

(‘‘Upon application . . . the Commission may issue 

an order requiring . . . such increase in 

transmission capacity as may be necessary to carry 

out the purposes of any order under subparagraph 

(A) or (B)’’); 16 U.S.C. 824j(a) (‘‘Any electric utility 

. . . may apply to the Commission for an order 

under this subsection requiring a transmitting 

utility to provide transmission services (including 

any enlargement of transmission capacity necessary 

to provide such services) to the applicant.’’)). 

220E.ON at 10. 

221E.ON at 11–12. 

222AWEA at 13. 

223We would expect that, in any order under 

sections 210 and 211, we would require the 

potential customer requesting expansion to pay all 

costs to study the request to expand and to take full 

responsibility for the costs to expand and operate 

the ICIF. 

224See supra n. 19. 

225NOPR, FERC Stats. & Regs. ¶ 32,701 at P 56. 

226The Commercial Operation Date is defined in 

the LGIP and LGIA as the date on which the 

Generating Facility commences generating 

electricity for sale, excluding electricity generated 

during on-site test operations and commissioning of 

the Generating Facility, as agreed to by the Parties 

pursuant to Appendix E to the Standard Large 

Generator Interconnection Agreement. 

227E.ON at 8. 

228E.ON at 9. 

owner to expand its facilities to 

accommodate a service request when 

sections 210 and 211 of the FPA provide 

for potential increases in transmission 

capacity as necessary.219

137. On the other hand, AWEA and 

E.ON support the safe harbor concept 

but urge the Commission to consider 

removing the rebuttable presumption 

standard. E.ON expresses concern that 

the safe harbor the Commission 

proposes would not relieve the 

interconnection customer of the 

regulatory compliance burden, because 

a third party could still initiate the 

process under sections 210 and 211 

during the safe harbor period and thus 

force the ICIF owner to demonstrate 

specific plans and milestones in order to 

sustain the rebuttable presumption.220

Further, while the NOPR proposed to 

rebuttably presume that an ICIF owner 

should not be required to expand the 

ICIF during the five-year safe harbor 

period, E.ON argues that it is unclear 

how a rebuttable presumption would 

apply in that context and what might be 

rebutted. E.ON argues that what is clear 

is that the ICIF owner needs to be 

unencumbered during the safe harbor 

period, so that it may focus on 

developing and bringing online 

successive phases of new generation.221

More generally, AWEA contends that if 

the generation developer dedicates the 

extra capital and builds ICIF that 

accommodate more capacity than 

needed for initial generation, it is 

because the generation developer plans 

to develop more generation in future 

phases. Accordingly, AWEA believes 

that removing the rebuttable 

presumption is appropriate because it 

will clarify that the generation 

developer and owner of the ICIF have 

sole use of the excess capacity, without 

the need to defend the right to that 

capacity.222

c. Commission Determination 

138. We will adopt the safe harbor 

period, but we will modify it to remove 

the rebuttable presumption that the ICIF 

owner should not be required to expand 

its facilities. During the safe harbor 

period, there will be a rebuttable 

presumption that the eligible ICIF 

owner has definitive plans to use its 

capacity without having to make a 

demonstration through a specific plans 

and milestones showing. We believe 

this Final Rule will relieve regulatory 

burdens and unnecessary risks from 

generation developers to encourage the 

development of new generation and 

efficient interconnection facilities and 

promote competition while ensuring 

access to transmission on a not unduly 

discriminatory basis. Under this Final 

Rule, the ICIF owner gains a degree of 

protection through the reduced 

likelihood that a third-party requester 

could rebut the presumption that an 

ICIF owner has plans to use all of its 

capacity. However, by making the 

presumption rebuttable rather than 

absolute, a third-party requester with 

strong evidence has the opportunity to 

gain access to the ICIF, even during the 

safe harbor. 

139. The proposal in the NOPR that 

the safe harbor period would also 

contain a rebuttable presumption that 

the ICIF owner should not have to 

expand its facilities was intended to 

provide generation developers an initial 

opportunity to establish their generation 

projects while limiting the burden and 

distraction of studying requests to 

expand its ICIF and potentially 

expanding those facilities to 

accommodate third party use. However, 

upon consideration of the comments, 

we believe such a rebuttable 

presumption could prevent third-party 

access without providing a substantial 

ease of burden for the ICIF owner.223 We 

conclude that eliminating this 

presumption strikes an appropriate 

balance by providing certainty to an 

ICIF owner over its planned capacity 

without hindering expansion of the 

facility in question when a potential 

customer requesting that expansion is 

willing to carry the burden associated 

with that possible expansion. 

140. With regard to NRECA’s 

argument that load-serving entities’ use 

of ICIF has minimal or positive impact 

on available ICIF capacity, we find that 

such arguments are based on an 

unlikely scenario that assumes away the 

intended function of the 

interconnection facilities at issue in this 

Final Rule. By definition, the facilities 

at issue are not part of the integrated 

transmission system, so it is a slim 

possibility that a load-serving entity 

would be in a position to make use of 

ICIF to serve load by counterflowing 

power relative to the generation 

associated with the ICIF. However, a 

load-serving entity may make arguments 

to support such a scenario in a 

proceeding under sections 210 and 211. 

2. Starting Point for the Safe Harbor 

Period 

a. Commission Proposal 

141. In the NOPR, the Commission 

proposed that the safe harbor period 

begin on the ICIF energization date. 

Because the energization date is not 

always publicly available, the 

Commission proposed that any eligible 

ICIF owner seeking to take advantage of 

the safe harbor must file an 

informational filing with the 

Commission (requiring no Commission 

action) documenting: (1) The ICIF 

energization date; (2) details sufficient 

to identify the ICIF at issue, such as 

location and Point of 

Interconnection; 224 and (3) 

identification of the ICIF owner. For 

generators that are already operating as 

of the effective date of the Final Rule, 

the Commission proposed to allow them 

to seek safe harbor status by filing at the 

Commission to document the 

information listed above, and that the 

safe harbor would expire five years after 

the initial energization of their ICIF.225

b. Comments 

142. E.ON, AWEA, First Wind, and 

NRG argue that ICIF energization is not 

the proper starting date for the safe 

harbor period and that the safe harbor 

period should instead begin when the 

first generating facility using the ICIF 

achieves commercial operation, the 

commercial operation date.226 E.ON 

argues that the point in the 

interconnection process where access to 

the grid begins is the appropriate 

starting point for the safe harbor 

period.227 E.ON states that, prior to this, 

the interconnecting transmission 

owner’s interconnection facilities and 

network upgrades may not be complete 

and available for use and that all 

necessary interconnecting transmission 

owner’s network upgrades may not be 

scheduled for completion for years after 

the ICIF are energized.228 E.ON adds 

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229E.ON at 9. 

230First Wind at 16. 

231AWEA at 15–16. 

232First Wind at 16 and NRG at 4. 

233NRG at 4. 

234NRG at 5. 

235Linden at 9–10. 

236Linden at 9–10. 

237MISO at 6. 

238We do not intend to issue a public notice, 

accept comments, or issue an order on the 

informational filings. 239NOPR, FERC Stats. & Regs. ¶ 32,701 at P 54. 240EEI at 14; NextEra at 17; EPSA at 6–7; NRG 

at 3–4; and SEIA at 4. 241EEI at 14. 242NextEra at 17. 

that, if the safe harbor begins on the ICIF 

energization date, it may only encourage 

energization to be delayed as long as 

possible in order to have as long a safe 

harbor period as is needed to support 

future phase’s priority use of the 

ICIF.229

143. AWEA and First Wind explain 

that for many wind projects the ICIF 

may be energized well before 

commercial operation of the wind 

project begins in order to provide 

backfeed power to the construction 

site.230 Accordingly, AWEA contends 

that the ‘‘energization date’’ would 

significantly limit the safe harbor period 

for phased development projects.231

First Wind and NRG argues that the 

commercial operation date not only 

provides a more appropriate starting 

date, but it also is a date that is routinely 

documented for other purposes (e.g., 

under Appendix E of the LGIA, the 

customer is required to provide written 

documentation of the commercial 

operation date, and power purchase 

agreements will have the commercial 

operation date.232 NRG also argues that 

the commercial operation date is 

universally understandable.233

144. NRG and Linden argue that the 

Commission should decline to adopt the 

requirement that owners of existing and 

new ICIFs submit an informational 

filing to get the benefit of the safe harbor 

provision. NRG argues that the 

Commission is already generally aware 

of the commercial operation date for 

interconnection facilities through 

market-based rate, exempt wholesale 

generator, and interconnection 

agreement filings. NRG further argues 

that the commercial operation date is an 

established and verifiable date, and 

interconnection facility owners are often 

required to provide notice of the 

commercial operation date to various 

parties under different project 

agreements. Additionally, third-parties 

that seek to interconnect can contact the 

ICIF owner directly and ask for the same 

information detailed in the 

informational filing, and ICIF owners 

can be required to provide the 

commercial operation date upon 

request. NRG argues that if there is any 

dispute regarding the commercial 

operation date, the third party can go to 

the Commission and seek clarification 

of the commercial operation date.234

Linden argues that the informational 

filing proposal would simply require 

numerous public utilities to make 

filings that will never be needed until 

and unless an entity seeks service over 

the ICIF.235 It argues that no policy 

would be served by requiring public 

utilities to preserve rights through an 

otherwise unnecessary informational 

filing.236

145. MISO supports the Commission’s 

proposal to require interconnection 

customers to submit their ICIF 

energization date to the Commission. 

Currently, MISO interconnection 

customers submit their test dates, which 

are very close to the energization date, 

to MISO’s resource integration group as 

part of the Generator Interconnection 

Agreement milestones.237

c. Commission Determination 

146. We will modify the proposal and 

will use the commercial operation date 

instead of the energization date. We find 

commenters’ argument convincing that 

the commercial operation date is the 

preferable starting point for the safe 

harbor period. The ICIF may be 

energized to provide needed backfeed 

power for construction equipment well 

before the first generator is ready to 

produce test power, thus shortening the 

safe harbor period and undermining the 

goal to give the generation project 

sufficient time to develop. Using the 

energization date would likely 

disadvantage certain developers who 

must energize their ICIF early in the 

construction process because of their 

particular circumstances, while other 

developers are not required to do so. 

Although commenters argue that the 

commercial operation date is frequently 

documented in other contexts, we are 

not aware of a publicly available source 

that would consistently provide the 

commercial operation date for ICIF. 

Commenters’ suggestion that potential 

customers request information from the 

ICIF owner or seek relief from the 

Commission creates an unnecessary 

barrier to potential customers and is 

inconsistent with the transparency we 

require for other elements of 

transmission and interconnection 

service. Accordingly, we will require, 

consistent with the NOPR proposal, that 

any eligible ICIF owner seeking to take 

advantage of the safe harbor must file an 

informational filing with the 

Commission (requiring no Commission 

action) stating: (1) The ICIF commercial 

operation date, as we define it below; (2) 

details sufficient to identify the ICIF at 

issue, such as location and Point of 

Interconnection; and (3) identification 

of the ICIF owner seeking to take 

advantage of the safe harbor.238 For ICIF 

that are already in commercial operation 

as of the effective date of the Final Rule, 

the ICIF owner may seek safe harbor 

status by filing at the Commission to 

provide the information listed above, 

and the safe harbor would expire five 

years after the commercial operation 

date of its ICIF. ICIF owners making 

such an informational filing should file 

under the following docket, Docket No. 

AD15–9–000, so that any interested 

third party will be able to easily identify 

the relevant filing and determine when 

a safe harbor is applicable. We consider 

the commercial operation date of ICIF to 

be the date those facilities are first used 

to transmit energy for sale, excluding 

use for on-site testing and 

commissioning of the generating 

facility. 

3. Length of the Safe Harbor Period 

a. Commission Proposal 

147. In the NOPR, the Commission 

proposed a safe harbor period of five 

years during which there would be a 

rebuttable presumption that: (1) The 

eligible ICIF owner has definitive plans 

to use its capacity without having to 

make a demonstration through a specific 

plans and milestones showing; and (2) 

the eligible ICIF owner should not be 

required to expand its facilities.239

b. Comments 

148. Several commenters argue for a 

seven-year safe harbor period.240 EEI 

argues that a presumption of five years 

from the date the line is energized is 

only minimally sufficient and providing 

an additional two years of safe harbor 

protection would allow the eligible ICIF 

owner to focus on building generation 

and achieving commercial operation 

during the safe harbor period.241

NextEra argues that a safe harbor of five 

years effectively presumes that the 

second phase will be completed without 

any delays and that the developer will 

not pursue development in additional 

phases. NextEra argues that a seven-year 

safe harbor would more fully achieve 

the Commission’s stated goals.242 EPSA 

and NRG agree that a seven-year period 

would better support ICIF project 

development, and argue that a sevenyear time period is supported by section 

3.3.1 of the pro forma LGIP under which 

the expected in-service date of a new 

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243EPSA at 6–7 and NRG at 3–4. 

244SEIA at 4. 

245BHE at 12–13. 

246AWEA at 15. 

247See supra PP 135–136. 

248APPA and TAPS at 15–16. 249NOPR, FERC Stats. & Regs. ¶ 32,701 at P 59. 

250For generators owned by a public utility 

transmission provider within its footprint, 

transmission service on the generator’s 

interconnection facilities has generally been 

governed by the public utility transmission 

provider’s OATT. See Puget Sound Energy, Inc., 133 

FERC ¶ 61,160 (2010), reh’g denied 139 FERC 

¶ 61,241 (2012). 

251Southern at 4–5; EEI at 11–13; BHE at 8–11; 

Sempra at 6–9; BP Wind 7–10; First Wind at 10; 

AWEA at 16; and NextEra 18–20. 

252EEI at 9; BHE at 8–10; and Southern at 4–5. 

253Southern at 4–5. 

254BHE at 8–10. 

255BP Wind at 8–9. 

256First Wind at 10. 

generating facility or increase in 

capacity of an existing facility should 

not be more than seven years from the 

date the interconnection request is 

received by the transmission 

provider.243 SEIA states that a sevenyear safe harbor period would ensure 

adequate time for financing and 

construction of additional generation 

capacity. SEIA asserts that analysis of 

the dozen largest solar projects expected 

to be online by 2016 reveals the median 

time from development to commercial 

operation is nearly six years. A sevenyear safe harbor will ensure that most, 

if not all, future phases of a solar power 

plant can be constructed within the safe 

harbor timeframe.244

149. Some commenters argue for a 

ten-year safe harbor period. BHE also 

agrees that the proposed five-year 

duration is impractically short given the 

commercial and permitting realities 

generation developers face and, argues 

the safe harbor should be for ten years 

from the date that the ICIF is 

energized.245 AWEA argues that the 

proposed five-year period should be 

extended to ten years in order to reduce 

the risks encountered by generation 

developers developing phased 

generation projects. AWEA explains that 

often times a wind generation project 

may be planned in three or four phases, 

which could not reasonably be expected 

to reach completion in a five-year 

period. According to AWEA, a ten-year 

safe harbor period would provide 

developers the appropriate amount of 

time and reasonable incentive needed to 

develop the ICIF necessary for the 

development of new, cost-effective wind 

energy resources.246

150. As discussed above, APPA, 

TAPS, and NRECA argue that the 

Commission should not implement a 

safe harbor period of any duration.247

Additionally, APPA and TAPS argue 

that the monopoly on ICIF will extend 

for longer than the five years of the safe 

harbor period.248 They argue that in 

order to avoid the safe harbor barrier, a 

requester must not file its application 

under sections 210 and 211 until after 

the five-year period. They point out that 

it will take some time for the 

Commission to issue a final order 

requiring interconnection and 

transmission service, and additional 

studies or modifications may be 

required even after a final order. 

Therefore, they contend, the proposed 

safe harbor effectively grants to the ICIF 

owner and its affiliates a monopoly over 

use of its ICIF for six years at a 

minimum. They argue that such a result 

cannot be harmonized with the 

Commission’s obligations to remedy 

undue discrimination in transmission 

service and its reliance on competitive 

markets to ensure just and reasonable 

wholesale prices. 

c. Commission Determination 

151. We adopt in this Final Rule the 

five-year safe harbor period. It 

represents a balancing of interests. On 

the one hand, we want to relieve 

regulatory burdens and unnecessary 

risks from generation developers to 

encourage the development of new 

generation and promote competition. 

On the other hand, we want to ensure 

not unduly discriminatory access to 

transmission which also promotes 

competition. We find that using the 

commercial operation date as the 

starting point for the safe harbor period 

eliminates some of the concerns 

regarding sufficient time for safe harbor 

protection. As such, we decline to 

increase the safe harbor period from five 

years to either seven or ten years. 

152. We disagree with APPA and 

TAPS that the safe harbor protection is 

effectively a minimum of six years 

instead of five. That is, the rebuttable 

presumption that the ICIF owner has 

definitive plans to use its capacity, 

without having to make a demonstration 

through a specific plans and milestones 

showing, ends five years after the 

commercial operation date. The fact that 

it takes time to get service under 

sections 210 and 211 does not change 

the fact that, at the end of the five year 

safe harbor period, if there were to be 

an application under sections 210 and 

211, the ICIF owner would need to show 

it has plans to use any remaining 

capacity on the ICIF and is making 

progress to completing those plans. In 

any event, we note that any request for 

interconnection or transmission service 

takes time to prepare and process, 

whether it is addressed to an ICIF owner 

pursuant to sections 210 and 211 or a 

public utility under its OATT. 

E. Affiliate Concerns 

1. Commission Proposal 

153. In the NOPR,249 the Commission 

sought comments on whether to extend 

the proposed reforms to generators 

whose ownership or operation of 

transmission facilities is limited to ICIF, 

but who are affiliated with a public 

utility transmission provider and are 

within or adjacent to the public utility 

transmission provider’s footprint (ICIFOwning Affiliates).250

2. Comments 

154. Several commenters argue that 

ICIF-Owning Affiliates should be 

eligible for the blanket waiver.251

Commenters assert that excluding ICIFOwning Affiliates from the proposed 

waivers would bestow an unfair 

advantage on their competitors without 

providing any regulatory benefits.252

Southern emphasizes that ICIF-Owning 

Affiliates function separately from the 

public utility transmission provider and 

are independent generators.253 BHE 

argues that the same reasons that 

warrant the Commission replacing its 

current case-by-case approach to 

granting waivers apply irrespective of 

corporate structure.254

155. BP Wind, Sempra, and First 

Wind take issue with the Commission’s 

stated concern in the NOPR that the 

generator’s vertically-integrated utility 

affiliate, if granted the blanket waiver, 

may take steps to structure its 

development projects to limit or deny 

access to transmission facilities. BP 

Wind emphasizes that there are various 

reasons why a company would place 

ownership of generation and associated 

generation interconnection facilities 

into a separate legal entity that are not 

in any way for the purpose of limiting 

access to generator interconnection 

facilities.255 First Wind argues that, as a 

practical matter, a transmission owner 

will not attempt to push facilities that 

are not properly defined as ICIF into the 

ICIF classification in order to remove 

them from availability under their 

OATTs or to secure priority rights, 

because it would violate the OATT and 

shift costs to the generation affiliate that 

would otherwise be recovered from 

OATT customers.256 Further, Sempra 

argues that the Commission has for 

years granted OATT waivers to ICIFowning generators interconnected to 

their affiliated utility systems because 

the facilities in question are sole-use, 

limited and discrete, radial in nature, 

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257Sempra at 8 (citing the TDM Rehearing 

Request at n. 20, pointing to the then-significant 

number of OATT waivers granted to such affiliated 

entities as of 2003). 

258Sempra at 8. 

259Sempra at 8–9. 

260BHE at 10. 

261Southern at 5. 

262BHE at 2, 10–11. 

263BP Wind at 7–8 and AWEA at 16. 

264Southern at 5. 

265BP Wind at 8–9. 

266NextEra at 18–20. 

267BHE at 17–18. 

268BHE at 17–18. 

269Linden at 8–9. 

270Southern at 6. 

271BHE at 13. 

272BHE at 14. 

273BHE at 15. 

274BHE at 16. 

275BHE at 3–4. 

276BHE at 3–4. 

and not part of an integrated 

transmission network.257

156. Several commenters argue that 

there are sufficient protections already 

in place to deter such behavior. Sempra 

notes that the Commissionjurisdictional interconnection process 

and the Commission’s Standards of 

Conduct provide additional protections 

to affiliated and unaffiliated generators 

alike, and that further protection is 

provided when the interconnection 

process is administered by an RTO or 

ISO.258 Sempra also states that if the 

Commission is made aware that a 

vertically-integrated utility has 

structured its generation and 

interconnection facilities development 

in such a way that inappropriately 

limits access to those facilities, the 

Commission could, among other things, 

revoke the blanket waiver and safe 

harbor treatment for those facilities.259

Further, BHE asserts that affiliate 

restrictions and enforcement tools all 

function to achieve non-discriminatory 

access over ICIF for third parties and 

that the procedures under sections 210 

and 211 of the FPA provide an extra 

level of protection.260 Southern agrees 

that the Commission’s concerns with 

respect to anti-competitive behavior by 

a transmission provider should be 

addressed by the Commission’s open 

access requirements, the Standards of 

Conduct, and the code of conduct.261

BHE contends that the Commission 

should extend eligibility for the 

proposed blanket waiver not only to 

affiliates of the transmission provider, 

but also to the wholesale generation 

function of a vertically-integrated 

utility, irrespective of whether the ICIF 

is physically located within or adjacent 

to the affiliated public utility 

transmission provider’s footprint.262

157. BP Wind and AWEA argue that 

the Commission should at least extend 

eligibility of the blanket waiver to ICIFowning Affiliates where they are 

geographically separate from the public 

utility transmission provider’s 

footprint.263 Southern, BP Wind, and 

NextEra question how ICIF-owning 

Affiliates will be treated if they do not 

receive the blanket waiver. Southern 

argues that a wholesale generator 

affiliate that is not a part of a verticallyintegrated utility’s OATT, and whose 

ownership/operation of transmission 

facilities is limited to ICIF, should not 

be required to be added to the public 

utility’s OATT because this could shift 

the costs of the ICIF to native load 

customers of the transmission provider 

and create other complexities for the 

transmission provider (e.g., compliance 

with Standards of Conduct).264

158. BP Wind points out that 

excluding ICIF-owning Affiliates from 

the blanket waiver could disadvantage 

jointly owned projects, as unaffiliated 

generator owners would effectively lose 

the value associated with their blanket 

waiver if they share ownership in a 

common set of ICIF with a generator 

that is affiliated with a public utility 

transmission provider.265 Similarly, if 

the Commission declines to extend the 

blanket waiver to ICIF-owning 

Affiliates, NextEra questions: (1) How 

ICIF-owning Affiliates could request the 

waiver on a case-by-case basis; (2) 

whether, without a waiver, each ICIFowning Affiliate is required to file its 

own OATT, resulting in holding 

companies with numerous OATTs on 

file, even for facilities located in the 

affiliated public utility transmission 

provider’s footprint; and (3) whether the 

ICIF-owning Affiliates have to transfer 

ownership or control of their facilities to 

the affiliated public utility transmission 

provider.266 In the event the 

Commission does extend the blanket 

waiver to ICIF-owning Affiliates, BHE 

asks the Commission to confirm that, in 

instances where a third party is granted 

a request for service under sections 210 

and 211 over an incumbent utility 

generator’s ICIF, that incumbent utility 

generator can fulfill its access 

responsibility by transferring 

operational control and responsibility 

for the relevant ICIF to its transmission 

provider to ensure non-discriminatory 

access over the ICIF.267 Additionally, 

BHE asks the Commission to clarify its 

expectations, in this scenario, as to 

whether the ICIF should be treated by 

the transmission provider as 

Transmission Provider’s 

Interconnection Facilities and managed 

under Article 9.9.2 of the Commission’s 

pro forma LGIA.268

159. Linden states that in the event 

that the Commission limits the 

applicability of the blanket waiver to 

non-affiliates, it requests that the 

Commission clarify that any such 

limitation would not apply to an 

affiliate of a merchant transmission 

provider.269

160. Southern and BHE also argue 

that the Commission should extend the 

safe harbor protection to ICIF-owning 

Affiliates because such generators are 

similarly situated to and operate the 

same as other wholesale generators. 

Southern believes that all wholesale 

generators and ICIF owners would 

benefit from the proposed safe harbor 

period.270 BHE requests that the 

Commission also extend eligibility for 

the safe harbor presumption to 

incumbent utility generators.271 BHE 

asserts that wholesale generator ICIF 

owners share the same commercial risks 

of having their specific generation 

expansion plans pre-empted by a 

competing unaffiliated generation 

developer and burden of pursuing a 

declaratory order from the Commission 

in order to reserve capacity for their 

future plans.272 According to BHE, any 

concerns with extending the safe harbor 

presumption beyond non-affiliates are 

reasonably mitigated without limiting 

the presumption to non-affiliated ICIF 

owners. BHE explains that under 

Commission rules, all generators 

seeking transmission interconnection 

and/or transmission service are to be 

treated comparably. BHE further notes 

that employees of a public utility with 

captive customers and its affiliates with 

market-based rate authority are to 

operate separately to the maximum 

extent practical.273 BHE also contends 

that it would be unduly discriminatory 

to deny incumbent utility generator and 

ICIF-owning Affiliates identical access 

to the safe harbor presumption, given 

that existing policy is equally 

burdensome, and creates the same 

regulatory uncertainty with respect to 

priority rights for all ICIF owners.274

161. BHE argues that, at a minimum, 

eligibility for the proposed safe harbor 

presumption should be extended to 

ICIF-owning Affiliates.275 BHE also 

argues that the safe harbor presumption 

should be applied to ICIF-owning 

Affiliates irrespective of whether the 

ICIF is physically located within or 

adjacent to the affiliated public utility 

transmission provider’s footprint.276

162. In contrast, some commenters 

argue that the Commission should not 

extend the proposed reforms to entities 

that are affiliated with a public utility 

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277APPA and TAPS at 16–17 and NRECA at 9– 

10. 

278APPA and TAPS at 16–17. 

279APPA and TAPS at 17 (citing to NOPR, FERC 

Stats. & Regs. ¶ 32,701 proposed section 

35.28(d)(2)(ii)(A)). 

280APPA and TAPS at 18 and NRECA at 9–10. 

281APPA and TAPS at 25–27. 282APPA and TAPS at 26–27. 

283 18 CFR pt. 358. 

284 ICIF Generator Affiliates are typically making 

sales for resale in interstate commerce and meet the 

Commission’s definition of marketing affiliates. See 

18 CFR 358.3(a) and (c). 

285 18 CFR 358.4. 

transmission provider.277 APPA and 

TAPS contend that the NOPR’s 

treatment of affiliates is inconsistent 

and contrary to the Commission’s 

market-based rate policies which have 

been crafted over decades to protect 

customers from the use of control over 

transmission facilities to erect barriers 

to competition in favor of the owner’s 

corporate family.278 They state that, 

while the NOPR does not consider the 

ICIF owner’s affiliates in defining 

eligibility for the blanket waiver or safe 

harbor, potentially even if the ICIF 

owner’s affiliate is a transmission 

provider, the Commission proposes to 

continue its policy of allowing the ICIF 

owner to point to its affiliate’s planned 

usage to demonstrate definitive plans to 

use any remaining ICIF capacity after 

the safe harbor period.279 APPA and 

TAPS argue that by ignoring affiliates in 

determining eligibility for waiver or safe 

harbor while allowing ICIF owners to 

use those same affiliates to fend off 

third-party access, the NOPR would 

incent utilities to organize their 

corporate structures to maximize their 

opportunities to block third-party 

competitive generation. 

163. APPA and TAPS also contend 

that transmission providers are already 

‘‘in the business of providing 

transmission service’’ and are subject to 

Standards of Conduct, and thus face no 

significant additional burden from the 

requirements the Commission proposes 

to waive. NRECA adds that such entities 

should not be granted privileges that are 

intended for generators that are 

completely independent of transmission 

providers. They argue that if extended 

to affiliates of transmission providers, 

the proposed reforms would incent 

transmission providers to structure 

generation and ICIF development to 

avoid open access and transmission 

planning obligations.280

164. APPA and TAPS contend that 

any ICIF policy changes should exclude 

affiliates of transmission providers from 

eligibility for the blanket waiver or safe 

harbor status at least within the 

transmission provider’s planning 

region.281 They argue that requiring 

transmission provider-affiliated ICIF 

owners within the transmission 

provider’s planning region to utilize the 

transmission provider’s existing OATT 

processes, rather than artificially 

walling-off such ICIF from access and 

transmission planning and expansion 

obligations, is necessary to prevent the 

transmission provider from evading its 

affirmative obligation to work within its 

transmission planning region to create a 

regional transmission plan. They assert 

that, at an absolute minimum, ICIF 

owners affiliated with transmission 

providers should be excluded from the 

blanket waiver and safe harbor as to any 

ICIF within the transmission provider’s 

footprint or an adjacent system.282

3. Commission Determination 

165. We conclude that the blanket 

waiver and safe harbor should apply to 

a public utility transmission provider’s 

affiliates whose ownership/operation of 

transmission facilities is limited to ICIF, 

regardless of geographic location. An 

ICIF-Owning Affiliate, as we use the 

term here, is a corporate entity that is 

separate from, and functions 

independently from, an affiliated public 

utility transmission provider that owns, 

controls, or operates non-ICIF 

transmission facilities. As such, the 

ICIF-Owning Affiliate is comparable to 

other independent generation 

companies that own ICIF within the 

public utility transmission provider’s 

footprint. Like other independent 

generation companies, an ICIF-Owning 

Affiliate faces the risk and potential 

burden of having to file an OATT if it 

receives a third-party request for 

service. The undue discrimination 

provisions of section 205 and section 

206 and the Commission’s existing 

Standards of Conduct rules should 

prevent undue discrimination and 

ensure that the transmission provider’s 

open access and transmission planning 

obligations are not circumvented. 

However, we decline to extend the 

blanket waiver to ICIF that are 

controlled or operated by the generation 

units of vertically-integrated public 

utilities (Generation Functions), as 

requested by BHE. 

166. We disagree with APPA and 

TAPS that extending the reforms 

adopted herein to ICIF-Owning 

Affiliates would constitute a departure 

from the Commission’s requirements 

that transmission service be not unduly 

discriminatory. Sections 205 and 206 of 

the FPA continue to govern the behavior 

of the ICIF-Owning Affiliates and public 

utility transmission providers after the 

reforms adopted herein become 

effective. Therefore, ICIF-Owning 

Affiliates and public utility 

transmission providers are prohibited 

from engaging in unduly preferential or 

unduly discriminatory behavior. In 

addition, the independent functioning 

and transparency requirements of the 

Standards of Conduct under Part 358 of 

the Commission’s regulations impose 

specific requirements governing the 

relationship between the ICIF-Owning 

Affiliates and the transmission 

provider.283 While a waiver of the 

Standards of Conduct for the ICIFOwning Affiliate would relieve it of the 

obligation to comply with the Standards 

of Conduct that require separation of 

transmission and marketing functions, 

that waiver has no effect on the 

transmission provider’s obligation to 

comply with the Standards of Conduct 

consistent with Part 358 of the 

Commission’s regulations.284 The 

Standards of Conduct also require, 

among other things, a transmission 

provider to treat all transmission 

customers, affiliated and non-affiliated, 

on a not unduly discriminatory basis, 

and prohibits the transmission provider 

from making or granting any undue 

preference or advantage to any person 

with respect to the transmission or sale 

of electric energy.285

167. We disagree with APPA and 

TAPS’ claim that granting the waiver to 

ICIF-Owning Affiliates would be 

inconsistent and contrary to the 

Commission’s market-based rate 

policies by failing to consider the ICIFOwning Affiliates in defining eligibility 

for market-based rates. The Commission 

considers the ICIF-Owning Affiliates 

when granting market-based rate 

authority. The market-based rate 

requirement under section 35.37(d) 

requires a seller that owns, operates, or 

controls transmission facilities, or 

whose affiliates own, operate, or control 

transmission facilities, to have on file 

with the Commission an OATT as 

described in section 35.28. However, the 

Commission allows sellers to rely on 

Commission-granted OATT waivers to 

satisfy the vertical market power part of 

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286 Market-Based Rates for Wholesale Sales of 

Electric Energy, Capacity and Ancillary Services by 

Public Utilities, Order No. 697, 72 FR 39904 (July 

20, 2007), FERC Stats. & Regs. ¶ 31,252 at P 408, 

clarified, 121 FERC ¶ 61,260 (2007), clarified, 124 

FERC ¶ 61,055, order on reh’g, Order No. 697–A, 73 

FR 25832 (May 7, 2008), FERC Stats. & Regs. 

¶ 31,268, order on reh’g, Order No. 697–B, 73 FR 

79610 (Dec. 30, 2008), FERC Stats. & Regs. ¶ 31,285 

(2008), order on reh’g, Order No. 697–C, 74 FR 

30924 (June 29, 2009), FERC Stats. & Regs. ¶ 31,291 

(2009), order on reh’g, Order No. 697–D, 75 FR 

14342 (Mar. 25, 2010), FERC Stats. & Regs. ¶ 31,305 

(2010), aff’d sub nom. Mont. Consumer Counsel v. 

FERC, 659 F.3d 910 (9th Cir. 2011), cert. denied, 

133 S. Ct. 26 (2012). 

287See supra P 57. 

288See 18 CFR 35.39(c) and § 35.39(d). 

289NRG at 6. 

290Prior Notice and Filing Requirements Under 

Part II of the Federal Power Act 64 FERC ¶ 61,139, 

clarified, 65 FERC ¶ 61,081, at 61,508 (1993) (Prior 

Notice). 

291First Wind at 12–14 and Invenergy at 12–13. 

292BHE at 19. 

the requirement.286 As noted above,287

the waiver in section 35.28(d)(2) is an 

additional way in which to satisfy the 

vertical market power requirements for 

transmission. Market-based rate 

authority is conditioned on compliance 

with the Affiliate Restrictions in section 

35.39 of the Commission’s regulations. 

Like the Standards of Conduct, the 

Affiliate Restrictions include 

independent functioning requirements 

as well as information sharing 

prohibitions.288 Thus, with the statutory 

prohibitions and implementing 

regulations, public utility transmission 

providers are not permitted to organize 

their corporate structures in a way that 

would block third-party competitive 

generation. 

168. Moreover, we note that entities 

may file a complaint under section 206 

with the Commission if they believe 

discrimination is occurring. Also, in 

determining whether a third party has 

rebutted the presumption under this 

Final Rule that an ICIF owner has 

definitive plans to use excess capacity 

on the ICIF during the safe harbor 

period, the affiliate relationship 

between the ICIF owner and a public 

utility transmission provider may be a 

factor in that determination. Finally, as 

a backstop, we note that the 

Commission possesses ample statutory 

remedies to address violations of the 

applicable regulations and statutes. As 

noted by Sempra, if the Commission 

became aware that a public utility 

transmission provider and an ICIFOwning Affiliate structured their 

transmission, generation, and 

interconnection facilities development 

in such a way that inappropriately 

limits access to those facilities, the 

Commission could, among other things, 

revoke the blanket waiver and safe 

harbor treatment for the ICIF-Owning 

Affiliate. Accordingly, the 

Commission’s existing rules, in concert 

with other tools available to hold 

entities accountable, are sufficient to 

ensure comparable treatment of 

affiliates and non-affiliates, and enforce 

the Commission’s requirements 

prohibiting undue discrimination 

without the provisions waived through 

this Final Rule. 

169. We find that it is not appropriate 

to grant the blanket waiver to 

Generation Functions. The public utility 

transmission provider has certain rights 

and obligations, one of which is to 

administer the transmission grid 

pursuant to its existing OATT. Where a 

Generation Function of the public 

utility transmission provider is an ICIF 

owner, we find it appropriate, in the 

event of a third-party request, for the 

request to be processed pursuant to its 

affiliated public utility transmission 

provider’s OATT. 

F. Miscellaneous 

1. Treatment of Line Losses on ICIF 

a. Comments 

170. NRG requests that the 

Commission explicitly state that all 

transmission line losses associated with 

a third party gaining access to an 

incumbent owner’s interconnection 

facility be borne solely by the third 

party. NRG argues that as more capacity 

is transmitted on these interconnection 

facilities and the excess capacity on 

these facilities diminishes, line losses 

will continue to increase to the 

detriment of the incumbent 

interconnection facility owner.289

b. Commission Determination 

171. We find the NRG’s argument to 

be beyond the scope of the proceeding. 

Treatment of line losses on ICIF should 

be negotiated between the parties using 

the ICIF. 

2. Applicability of the Commission’s 

‘‘Prior Notice’’ Policy 

a. Comments 

172. First Wind and Invenergy ask the 

Commission to confirm that its Prior 

Notice policy 290 also applies to requests 

for ICIF access. In Prior Notice, the 

Commission, among other things, found 

that transmission study contracts and 

charges, while jurisdictional, do not 

have to be filed unless they are the 

subject of a complaint filed by the 

transmission requester under section 

206 of the Federal Power Act alleging 

that the rates charged for a transmission 

feasibility study are unjust, 

unreasonable or unduly discriminatory, 

or preferential. First Wind and 

Invenergy contend that the Commission 

should confirm that this Prior Notice 

policy applies not only to transmission 

requests under section 211, but also to 

interconnection requests under section 

210 and to any requests for ICIF 

access.291

b. Commission Determination 

173. We decline to address the 

Commission’s filing requirements as 

they are beyond the scope of the 

proceeding. 

3. Technical Aspects of Interconnection 

a. Comments 

174. BHE states that third-party access 

to an ICIF should only be allowed at a 

point past the high side (transmission 

side) of a collector bus, and not on the 

low side (generator side) of the collector 

bus. It argues that such access to the 

generator side of the collector 

introduces technical system protection 

and control complexities that would be 

impractical to accommodate, requiring 

an inordinate amount of coordination 

between interconnecting generation 

projects and may even compromise the 

reliability of the interconnecting 

facilities.292

b. Commission Determination 

175. We find BHE’s argument to be 

beyond the scope of the proceeding. 

Disputes regarding technical 

requirements of the reliable 

interconnection of third-party 

generators should be addressed in 

particular proceedings under sections 

210 and 211. 

4. Implementation 

176. For those entities that satisfy the 

eligibility requirements set forth in this 

Final Rule, the blanket waiver will be 

effective as of the effective date of this 

Final Rule. For those entities that must 

file a statement of compliance with 

section 210 of the FPA in order to 

achieve eligibility, the blanket waiver 

will be effective as of the latter of the 

effective date of this Final Rule or the 

date the statement of compliance is 

filed. If an entity has a case-specific 

request for waiver of OATT 

requirements pending as of the date that 

the entity becomes eligible for the 

blanket waiver, the blanket waiver will 

apply as of that date, and the entity 

should file to withdraw the waiver 

request to the extent it has been 

rendered moot by the blanket waiver. As 

discussed in section IV.B.7 above, an 

entity that has already been issued a 

waiver of the same requirements waived 

by the blanket waiver and is eligible for 

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Federal Register / Vol. 80, No. 62 / Wednesday, April 1, 2015 / Rules and Regulations 17679 

293 5 CFR 1320.11(b) (2013). 294 44 U.S.C. 3507(d) (2012). 

the blanket waiver will be deemed to be 

operating under the blanket waiver 

without further filings necessary with 

respect to the issued waiver. However, 

as discussed in section IV.B.8 above, the 

blanket waiver will have no automatic 

impact on existing OATTs that govern 

service requests over ICIF, although the 

Commission will consider a request to 

withdraw an OATT on a case-by-case 

basis if no third parties are taking 

service under it. With respect to the 

informational statement regarding the 

commercial operation date of the ICIF 

discussed in section IV.D.2 above, we 

note that such statement need only be 

filed if the ICIF owner seeks to take 

advantage of the five-year safe harbor 

period. 

V. Information Collection Statement 

177. The Office of Management and 

Budget (OMB) regulations require 

approval of certain information 

collection and data retention 

requirements imposed by agency 

rules.293 Upon approval of a 

collection(s) of information, OMB will 

assign an OMB control number and an 

expiration date. Respondents subject to 

the filing requirements of a rule will not 

be penalized for failing to respond to 

these collections of information unless 

the collections of information display a 

valid OMB control number. 

178. The Commission is submitting 

the proposed modifications to its 

information collections to OMB for 

review and approval in accordance with 

section 3507(d) of the Paperwork 

Reduction Act of 1995.294 In the NOPR, 

the Commission solicited comments on 

the Commission’s need for this 

information, whether the information 

will have practical utility, the accuracy 

of the burden estimates, ways to 

enhance the quality, utility, and clarity 

of the information to be collected or 

retained, and any suggested methods for 

minimizing respondents’ burden, 

including the use of automated 

information techniques. The 

Commission included a table that listed 

the estimated public reporting burdens 

for the proposed reporting requirements, 

as well as a projection of the costs of 

compliance for the reporting 

requirements. 

179. The Commission did not receive 

any comments specifically addressing 

the burden estimates provided in the 

NOPR. However, the Commission has 

made changes to its proposal that are 

adopted in this Final Rule. 

180. First, the regulations adopted in 

the Final Rule give a blanket waiver of 

OATT, OASIS, and Standards of 

Conduct filing requirements, to all ICIF 

owners, including those that do not sell 

electric energy. Under the Final Rule, an 

ICIF owner that does not sell electric 

energy is required to make an 

informational filing stating that it 

commits to comply with and be bound 

by the obligations and procedures 

applicable to electric utilities under 

section 210 of the FPA in order to 

receive the blanket waiver. We have 

increased the burden estimate in the 

table below to reflect this filing. 

181. Second, the Commission revised 

the beginning of the safe harbor period 

from the ICIF energization date to the 

ICIF commercial operation date. The 

Commission recognizes that most ICIF 

owners will likely make a brief 

notification filing documenting: (1) The 

ICIF commercial operation date; (2) 

details sufficient to identify the ICIF at 

issue, such as location and Point of 

Interconnection; and (3) identification 

of the ICIF owner. However, because the 

filing is similar to that proposed in the 

NOPR, we are not modifying the 

estimated public reporting burdens for 

this proposed reporting requirement in 

the table below. The Commission 

believes that the revised burden 

estimates below are representatives of 

the average burden on respondents. 

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17680 Federal Register / Vol. 80, No. 62 / Wednesday, April 1, 2015 / Rules and Regulations 

295The estimates for cost per response are derived 

using the following formula: Average Burden Hours 

per Response * $94.66 per Hour = Average Cost per 

Response. The hourly cost figure represents a 

combined hourly rate of an attorney ($131.00), 

economist ($71.00), engineer ($65.34), and 

administrative staff ($38.63), with a 50 percent 

weighting on the attorney’s rate (i.e. [$131(1/2) + 

$71.00(1/6) + $65.34(1/6) + $38.63(1/6)]/4 = $94.66. 

The estimated hourly costs (salary) are based on 

Bureau of Labor and Statistics information 

(available at http://www.bls.gov/oes/current/

naics2_22.htm, and are adjusted to include benefits 

by assuming that salary accounts for 68.7 percent 

of total compensation). See http://www.bls.gov/

news.release/ecec.nr0.htm. 

296The average number of filings for the first 

three years is computed as follows. The 

Commission expects approximately 80 safe harbor 

filings in the first year, which represents the 

number of waiver filings over a historical five-year 

period and thus the approximate number of existing 

entities which will be able to take advantage of the 

five- year safe harbor period as of the effective date 

of the Final Rule in this proceeding. In the 

subsequent two years, the Commission expects 

approximately 18 safe harbor filings per year, which 

represents the historical number of OATT waiver 

filings (16), OATT filings (1), and petitions for 

declaratory order (1) per year. Going forward, we 

would expect the entities complying with the Final 

Rule would avoid these filings and that the relevant 

entities would instead avail themselves of the safe 

harbor period. The average of the three-year period 

then is (80 + 18 + 18)/3 = 39. 

297The average number of filings for the first 

three years is computed as follows. The 

Commission expects approximately 40 section 210 

applicability filings in the first year, which 

represents half the number of waiver filings over a 

historical five-year period. The Commission does 

not know the precise number of existing ICIF 

owners that do not sell electric energy. Of the 80 

ICIF owner that have requested waiver in the past 

five years, the Commission reasons that some share 

of them do not sell electric energy, and we use 50 

percent as an estimate. While there is no five year 

limitation that applies to entities that may make 

this filing, we reason that this issue, while not new, 

has become more relevant in recent years because 

of an increase in generation owners retaining 

control of their ICIF; hence, we are not including 

in our estimate any estimate of the number of ICIF 

owners that do not sell electric energy that would 

have requested waiver prior to 2010. In the 

subsequent two years, the Commission expects 

approximately nine section 210 applicability filings 

per year, which represents half the historical 

number of OATT waiver filings (16), OATT filings 

(1), and petitions for declaratory order (1) per year. 

Going forward, we would expect the entities 

complying with the Final Rule would avoid these 

filings and that the relevant entities would instead 

avail themselves of the blanket ICIF waiver. The 

average of the three-year period then is (40 + 9 + 

9)/3 = 19. 

RM14–11 (OPEN ACCESS AND PRIORITY RIGHTS ON INTERCONNECTION CUSTOMER’S INTERCONNECTION FACILITIES) 

Number of 

respondents 

Annual 

number of 

responses per 

respondent 

Total 

number of 

responses 

Average 

burden and 

cost per 

response 295

Total 

annual 

burden 

hours and 

total annual 

cost 

Average 

cost per 

respondent 

($) 

(1) (2) (1) * (2) = (3) (4) (3) * (4) = (5) (5) ÷ (1) 

Individual Requests for Waiver (FERC–917) ...... 16 ¥1 ¥16 10 

$947 

¥160 

¥$15,146 

¥$947 

OATT Filings (FERC–917) ................................... 1 ¥1 ¥1 100 

$9,466 

¥100 

¥$9,466 

¥$9,466 

Petitions for Declaratory Order requesting priority rights (FERC–582) ................................... 1 ¥1 ¥1 30 

$2,840 

¥30 

¥$2,840 

¥$2,840 

Safe Harbor Commercial Operation Date Filing 

(average of first three years) 296 (FERC–917) 39 1 39 1 

$95 

39 

$3,692 

$95 

ICIF Owner that Does Not Sell Electric Energy 

Filing to Receive Blanket Waiver (average of 

first three years) 297 (FERC–917) ..................... 19 1 19 1 

$95 

19 

$1,799 

$95 

Total .............................................................. .................... ........................ 40 .................... ¥232 

¥$21,961 

¥$13,063 

Cost to Comply: The Commission has 

projected the cost of compliance with 

the safe harbor commercial operation 

date filing to be $7,573 in the initial 

year and $1,704 in subsequent years, as 

new ICIF owners make safe harbor 

filings for their new projects. In 

addition, the Commission has projected 

the cost of compliance for ICIF owners 

that do not sell electric energy to make 

an informational filing stating that it 

commits to comply with and be bound 

by the obligations and procedures 

applicable to electric utilities under 

section 210 of the FPA in order to 

receive the blanket waiver to be $3,786 

in the initial year and $852 in 

subsequent years, as new ICIF owners 

make such filings. This is offset by the 

reduction in burden associated with the 

waiver of filing requirements of $27,452 

per year. As an average for the first three 

years, this amounts to a net reduction in 

burden of $21,961. 

Total Annual Hours for Collection in 

initial year (120 hours) @$94.66 an hour 

= $11,359. 

Total Annual Hours for Collection in 

subsequent years (27 hours) @$94.66 an 

hour = $2,556. 

Total Annual Hours for Reduced 

Collection per year (290 hours) @$94.66 

an hour = $27,452. 

Title: FERC–582, Electric Fees and 

Annual Charges; FERC–917, NonDiscriminatory Open Access 

Transmission Tariff. 

Action: Revision of Currently 

Approved Collection of Information. 

OMB Control No. 1902–0132; 1902– 

0233. 

Respondents for this Rulemaking: 

Businesses or other for profit and/or 

not-for-profit institutions. 

Frequency of Information: As 

indicated in the table. 

Necessity of Information: The 

Commission is adopting these changes 

to its regulations related to which 

entities must file the pro forma OATT, 

establish and maintain an OASIS, and 

abide by its Standards of Conduct in 

order to eliminate unnecessary filings 

and increase certainty for entities that 

develop generation. The purpose of this 

Final Rule is to reduce regulatory 

burdens and promote development 

while continuing to ensure open access 

to transmission facilities. The safe 

harbor commercial operation date filing 

is necessary to ensure transparency as to 

the applicability of the safe harbor 

period. 

Internal Review: The Commission has 

reviewed the proposed changes and has 

determined that the changes are 

necessary. These requirements conform 

to the Commission’s need for efficient 

information collection, communication, 

and management within the energy 

industry. The Commission has assured 

itself, by means of internal review, that 

there is specific, objective support for 

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Federal Register / Vol. 80, No. 62 / Wednesday, April 1, 2015 / Rules and Regulations 17681 

298 5 U.S.C. 601–612 (2014). 

299SBA Final Rule on ‘‘Small Business Size 

Standards: Utilities,’’ 78 FR 77,343 (Dec. 23, 2013). 

300 13 CFR 121.201, Sector 22, Utilities. 

301The Small Business Administration sets the 

threshold for what constitutes a small business. 

Public utilities may fall under one of several 

different categories, each with a size threshold 

based on the company’s number of employees, 

including affiliates, the parent company, and 

subsidiaries. The possible categories for the 

applicable entities have a size threshold ranging 

from 250 employees to 1,000 employees. For the 

analysis in this final rule, we are using the 500 

employee threshold for each applicable entity type. 

302See supra n. 298. We estimate that all affected 

entities will make the safe harbor filing, but that 

only half do not sell electric energy and thus need 

to make the commitment to comply with section 

210 of the FPA. Thus, $142 = (1) × ($94.66) + 

(1/2) × ($94.66). 

303This reduced burden amount is calculated by 

taking the total estimated burden reduction per 

year, $27,452, and dividing by 18, the estimated 

number of filings avoided because of the new 

regulations. 

304Credit Reforms in Organized Wholesale 

Electric Markets, 133 FERC ¶ 61,060, at P 184 

(2010). 

the burden estimates associated with the 

information collection requirements. 

182. Interested persons may obtain 

information on the reporting 

requirements by contacting the 

following: Federal Energy Regulatory 

Commission, 888 First Street NE., 

Washington, DC 20426 [Attention: Ellen 

Brown, Office of the Executive Director], 

email: DataClearance@ferc.gov, Phone: 

(202) 502–8663, fax: (202) 273–0873. 

183. Comments on the requirements 

of this Final Rule can be sent to the 

Office of Information and Regulatory 

Affairs, Office of Management and 

Budget, 725 17th Street NW., 

Washington, DC 20503 [Attention: Desk 

Officer for the Federal Energy 

Regulatory Commission]. For security 

reasons, comments to OMB should be 

submitted by email to: oira_

submission@omb.eop.gov. Comments 

submitted to OMB should include 

Docket No. RM14–11–000 and OMB 

Control No. 1902–0132 and/or 1902– 

0233. 

VI. Regulatory Flexibility Act Analysis 

184. The Regulatory Flexibility Act of 

1980 (RFA) 298 generally requires a 

description and analysis of final rules 

that will have a significant economic 

impact on a substantial number of small 

entities. The Small Business 

Administration (SBA) revised its size 

standard (effective January 22, 2014) for 

electric utilities from a standard based 

on megawatt hours to a standard based 

on the number of employees including 

affiliates.299 Under SBA’s new size 

standards, ICIF owners likely come 

under the following category and 

associated size threshold: Electric bulk 

power transmission and control, at 500 

employees.300 The Final Rule states that 

approximately 80 entities will be 

affected by the changes imposed. Of 

these, the Commission estimates that 

approximately 93.1 percent 301 or 75 of 

these are small entities. In the Final 

Rule, the Commission estimates that, on 

average, each of the small entities to 

whom the Final Rule applies will incur 

one-time costs of $142 in order to: (1) 

Document its commercial operation date 

and thus avail itself of the safe harbor 

provision; and, (2) if the entity does not 

sell electricity, commit to comply with 

section 210 of the FPA.302 This is true 

for those existing entities that have 

already received waiver of the OATT 

prior to the issuance of the Final Rule, 

as well as for new entities. This cost 

will be offset for new entities by, on 

average, $1,525.303 As the Commission 

has previously explained, in 

determining whether a regulatory 

flexibility analysis is required, the 

Commission is required to examine only 

direct compliance costs that a 

rulemaking imposes on small 

business.304 It is not required to 

examine indirect economic 

consequences, nor is it required to 

consider costs that an entity incurs 

voluntarily. The Commission does not 

consider the estimated costs per small 

entity to have a significant economic 

impact on a substantial number of small 

entities. Accordingly, the Commission 

certifies that the Final Rule will not 

have a significant economic impact on 

a substantial number of small entities. 

VII. Document Availability 

185. 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 

FERC’s Home Page (http://

www.ferc.gov) and in FERC’s Public 

Reference Room during normal business 

hours (8:30 a.m. to 5:00 p.m. Eastern 

time) at 888 First Street NE., Room 2A, 

Washington, DC 20426. 

186. From FERC’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. 

187. User assistance is available for 

eLibrary and the FERC’s Web site during 

normal business hours from FERC 

Online Support at (202) 502–6652 (toll 

free at 1–866–208–3676) or email at 

ferconlinesupport@ferc.gov, or the 

Public Reference Room at (202) 502– 

8371, TTY (202) 502–8659. Email the 

Public Reference Room at 

public.referenceroom@ferc.gov. 

VIII. Effective Date and Congressional 

Notification 

These regulations are effective June 

30, 2015. The Commission has 

determined, with the concurrence of the 

Administrator of the Office of 

Information and Regulatory Affairs of 

OMB, that this rule is not a ‘‘major rule’’ 

as defined in section 351 of the Small 

Business Regulatory Enforcement Act of 

1996. The Commission will submit this 

Final Rule to both houses of Congress 

and the Government Accountability 

Office. 

List of Subjects in 18 CFR Part 35 

Electric power rates, Electric utilities, 

Reporting and recordkeeping 

requirements. 

By the Commission. 

Issued: March 19, 2015. 

Nathaniel J. Davis, Sr., 

Deputy Secretary. 

In consideration of the foregoing, the 

Commission amends Part 35, Chapter I, 

Title 18, Code of Federal Regulations, as 

follows: 

PART 35—FILING OF RATE 

SCHEDULES AND TARIFFS 

■ 1. The authority citation for part 35 

continues to read as follows: 

Authority: 16 U.S.C. 791a–825r, 2601– 

2645; 31 U.S.C. 9701; 42 U.S.C. 7101–7352. 

■ 2. Amend § 35.28 by revising 

paragraph (d) to read as follows: 

§ 35.28 Non-discriminatory open access 

transmission tariff. 

* * * * * 

(d) Waivers. (1) A public utility 

subject to the requirements of this 

section and 18 CFR parts 37 (Open 

Access Same-Time Information System) 

and 358 (Standards of Conduct for 

Transmission Providers) may file a 

request for waiver of all or part of such 

requirements for good cause shown. 

(2) The requirements of this section, 

18 CFR parts 37 (Open Access SameTime Information System) and 358 

(Standards of Conduct for Transmission 

Providers) are waived for any public 

utility that is or becomes subject to such 

requirements solely because it owns, 

controls, or operates Interconnection 

Customer’s Interconnection Facilities, in 

whole or in part, as that term is defined 

in the standard generator 

interconnection procedures and 

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17682 Federal Register / Vol. 80, No. 62 / Wednesday, April 1, 2015 / Rules and Regulations 

agreements referenced in paragraph (f) 

of this section, or comparable 

jurisdictional interconnection facilities 

that are the subject of interconnection 

agreements other than the standard 

generator interconnection procedures 

and agreements referenced in paragraph 

(f) of this section, if the entity that owns, 

operates, or controls such facilities 

either sells electric energy, or files a 

statement with the Commission that it 

commits to comply with and be bound 

by the obligations and procedures 

applicable to electric utilities under 

section 210 of the Federal Power Act. 

(i) The waivers referenced in this 

paragraph (d)(2) shall be deemed to be 

revoked as of the date the public utility 

ceases to satisfy the qualifications of 

this paragraph (d)(2), and may be 

revoked by the Commission if the 

Commission determines that it is in the 

public interest to do so. After revocation 

of its waivers, the public utility must 

comply with the requirements that had 

been waived within 60 days of 

revocation. 

(ii) Any eligible entity that seeks 

interconnection or transmission services 

with respect to the interconnection 

facilities for which a waiver is in effect 

pursuant to this paragraph (d)(2) may 

follow the procedures in sections 210, 

211, and 212 of the Federal Power Act, 

18 CFR 2.20, and 18 CFR part 36. In any 

proceeding pursuant to this paragraph 

(d)(2)(ii): 

(A) The Commission will consider it 

to be in the public interest to grant 

priority rights to the owner and/or 

operator of interconnection facilities 

specified in this paragraph (d)(2) to use 

capacity thereon when such owner and/ 

or operator can demonstrate that it has 

specific plans with milestones to use 

such capacity to interconnect its or its 

affiliate’s future generation projects. 

(B) For the first five years after the 

commercial operation date of the 

interconnection facilities specified in 

this paragraph (d)(2), the Commission 

will apply the rebuttable presumption 

that the owner and/or operator of such 

facilities has definitive plans to use the 

capacity thereon, and it is thus in the 

public interest to grant priority rights to 

the owner and/or operator of such 

facilities to use capacity thereon. 

Note: Appendix A will not be published in 

the Code of Federal Regulations. 

Appendix A: List of Short Names of 

Commenters on the Notice of Proposed 

Rulemaking 

Commenter (Short Name or Acronym) 

American Public Power Association and 

Transmission Access Policy Study Group 

(APPA and TAPS) 

American Wind Energy Association (AWEA) 

Berkshire Hathaway Energy Company (BHE) 

BP Wind Energy North America Inc. (BP 

Wind) 

California Department of Water Resources 

State Water Project (SWP) 

Cogen Technologies Linden Venture, L.P. 

(Linden) 

DTE Energy Company (DTE) 

Edison Electric Institute (EEI) 

Electric Power Supply Association (EPSA) 

Electricity Consumers Resource Council 

(ELCON) 

E.ON Climate & Renewables North America 

(E.ON) 

First Wind Energy, LLC (First Wind) 

Invenergy Wind LLC, Invenergy Wind 

Development LLC, and Invenergy Thermal 

Development LLC (Invenergy) 

ITC Transmission, Michigan Electric 

Transmission Company, LLC, ITC 

Midwest, LLC, and ITC Great Plains, LLC 

(ITC) 

Midcontinent Independent System Operator, 

Inc. (MISO) 

MISO Transmission Owners (MISO TOs) 

National Rural Electric Cooperative 

Association (NRECA) 

NextEra Energy, Inc. (NextEra) 

Northern California Power Agency (NCPA) 

The NRG Companies (NRG) 

Recurrent Energy (Recurrent) 

Sempra U.S. Gas & Power, LLC (Sempra) 

Solar Energy Industries Association (SEIA) 

Southern Company Services, Inc. (Southern) 

Terra-Gen Dixie Valley, LLC (Terra-Gen) 

[FR Doc. 2015–06953 Filed 3–31–15; 8:45 am] 

BILLING CODE 6717–01–P 

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