Monday, February 18, 2019

RTO Insider: NEPOOL Can’t ‘Have it Both Ways’ on Press Ban

By Rich Heidorn Jr.

The New England Power Pool is trying to “have it both ways” in claiming FERC lacks jurisdiction to overturn the RTO’s press and public ban while holding special privileges as ISO-NE’s stakeholder body, RTO Insider said in filings Friday.

The publication’s filings followed NEPOOL’s Oct. 1 answer to protests that joined RTO Insider in calling for open stakeholder meetings. New England is the only one of the seven U.S. regions served by RTOs or ISOs where the press and public are prohibited from attending stakeholder meetings.

nepool press ban open stakeholder meetings

Many of NEPOOL’s meetings are held at the Westborough, Mass., DoubleTree Hotel. | Google

“While the opposition pleadings mostly repeat arguments previously made by RTO Insider, the opposition pleadings also seek to relitigate whether New England arrangements satisfy the commission’s Order No. 719 requirements,” NEPOOL said, referring to filings by New Hampshire Consumer Advocate D. Maurice Kreis, the Reporters Committee for Freedom of Press and a joint filing by the Sustainable FERC Project, Conservation Law Foundation, Earthjustice and Natural Resources Defense Council.

NEPOOL said preventing the public and press from attending and reporting on stakeholder meetings was necessary to ensure the meetings are “efficient and productive.”

“NEPOOL fully expects that if press reporters are present in NEPOOL meetings, interested members would continue to advocate their positions. But NEPOOL also expects that an increased amount of such advocacy would largely take place outside of NEPOOL meetings. The presence of press reporters in meetings, undeniably, would erode the confidence built among NEPOOL members over its almost five decades of successful history that specific statements made by others in NEPOOL meetings will not be published publicly.”

NEPOOL said its opponents are wrong in citing Order 719 as justification for opening its meetings. The commission said the order was intended to “establish a means for customers and other stakeholders to have a form of direct access to RTO/ISO boards of directors, and thereby increase the boards of directors’ responsiveness to those entities.”

“The ‘access’ referred to that of RTO/ISO customers and stakeholders to RTO/ISO boards. Press is neither a customer nor stakeholder, and they certainly are not a direct representative of either,” NEPOOL said. “Further, NEPOOL is not the RTO/ISO board. As such, any reliance on Order 719 is misplaced.”

On Aug. 13, NEPOOL asked FERC to approve amendments to its Agreement to codify an unwritten policy of banning news reporters and the public from attending the group’s stakeholder meetings (ER18-2208). The group drafted the revisions after RTO Insider reporter Michael Kuser applied for membership in NEPOOL’s Participants Committee as an End User customer in March.

Conditioning Authority

RTO Insider responded to NEPOOL’s filing with a Section 206 complaint Aug. 31 asking the commission to overturn the organization’s ban or terminate the group’s role and direct ISO-NE to adopt an open stakeholder process like those used by other RTOs (EL18-196).

RTO Insider made filings in both dockets on Friday, including a 47-page answer to NEPOOL’s motion to dismiss its complaint, in which the power pool claimed FERC lacks jurisdiction to order a change. (See NEPOOL: FERC Can’t Change Press, Public Ban.)

RTO Insider said NEPOOL’s claims that it is not a public utility is “incompatible with having the NEPOOL Agreement on file with the commission, with NEPOOL making [Federal Power Act] Section 205 filings with the commission as a filing party, with NEPOOL having ‘jump ball’ Section 205 filing rights, and with commission orders involving NEPOOL governance,” RTO Insider attorney Steve Huntoon wrote. “NEPOOL’s attempt to avoid commission oversight while enjoying vast powers, privileges and subsidies is a classic case of trying to have it both ways.”

In making its jurisdictional argument, NEPOOL cited the D.C. Circuit Court of Appeals’ 2004 order rejecting FERC’s attempt to force CAISO to replace its governing board. Huntoon said NEPOOL ignored commission precedent in a 2016 ruling approving funding for PJM’s state consumer advocates (ER16-561-001). The commission in that order ruled that the “PJM stakeholder process is a practice that directly affects wholesale rates, and thus approval of a proposal that would enhance that process falls within the commission’s jurisdiction under Section 205a.” (See FERC Upholds PJM Advocates’ Funding.)

Even if the commission determines it lacks authority to force NEPOOL to change its rules, “the CAISO opinion was clear that the commission retains conditioning authority,” Huntoon said. “In CAISO, the court cited with approval a prior decision, Central Iowa Power Cooperative v. FERC, in which ‘FERC conditioned the approval of the power pool on removal of the membership criteria, rather than ordering the power pool to change those criteria directly.’”

Insiders and Outsiders

RTO Insider’s filing included letters submitted by six U.S. senators and 12 members of the House of Representatives calling on FERC to open the meetings. (See New England Senators Urge FERC to End Press Ban.) It also included a copy of a Sept. 6 RTO Insider article quoting former Commissioners Pat Wood III and Nora Mead Brownell as saying they were unaware of NEPOOL’s closed-door policy when they approved it as ISO-NE’s stakeholder body. (See Wood, Brownell: Unaware of Press Ban When OK’d NEPOOL.)

Public Citizen filed comments Oct. 3 challenging NEPOOL’s claim that its members “voted overwhelmingly against having press reporters as NEPOOL members” at the June 26 Participants Committee meeting. Only 115 of NEPOOL’s more than 500 members were present or had proxies at the meeting.

While 32 votes were cast in favor of the press ban, 24 members were opposed and 59 abstained. In addition, NEPOOL records show that six officers or their associates represented companies that provided 21 of the 32 votes for the ban.

The six have conflicts of interest in voting for the ban because they earn income selling “intelligence” about NEPOOL proceedings, said Tyson Slocum, director of Public Citizen’s Energy Program.

“When deliberative bodies are transparent and open to the public, information resources regarding details of their proceedings are inexpensive, reflecting the ease with which the information can be obtained and disseminated,” Slocum wrote. “But restricting participation, and making access to deliberations more exclusive, bestows ‘financial market opportunities’ for those granted special access. Those participants on the ‘inside’ can sell their services to those on the ‘outside.’”

The Sustainable FERC Project, Natural Resources Defense Council and Conservation Law Foundation filed a joint motion also opposing NEPOOL’s motion to dismiss RTO Insider’s complaint.

“An RTO/ISO’s formal engagement with stakeholders is … squarely within the commission’s jurisdiction, and the commission should intervene when an opaque stakeholder process that completely excludes the press decreases stakeholder input, decreases public understanding and transparency, and creates a needless risk to the legitimacy of important RTO/ISO decisions,” they said.