Utility Dive
Summary
State regulators launched similar charges against FERC's order on energy storage, alleging that the commission was illegally encroaching on state authority over the distribution system. The U.S. Court of Appeals for the D.C. Circuit ruled in FERC's favor last summer, but NARUC in its request for rehearing on 2222-A argued the circumstances in this instance are different.
In that case, state programs prohibiting or limiting energy storage from participating in wholesale markets didn't exist; in this case, states do have programs in place addressing demand response. Therefore, FERC is actively removing state authority in this case, in violation of a 2009 order that allowed states to opt-out of demand response programs implemented by regional grid operators, NARUC and utilities argued. That opt-out provision was intended to ensure states were able to address costs at the distribution level, which might not be seen or fully understood by federal regulators, groups, including the North Carolina Utilities Commission, Louisiana Public Service Commission and the Mississippi Public Service Commission, argued.
Further, Order 2222 has proven to be complicated. Several grid operators have already requested a timeline extension, which NARUC argued is further evidence that implementation would not be easy, and therefore states should be given all the flexibility possible.
"As we have said before, some states are open if not eager to accommodate DER participation in the wholesale markets, but as we have also said repeatedly not all states are in the same place. … The opt out would have provided the flexibility states need to manage the energy transition at their own pace," NARUC said in its comments. "Now, however, with Order No. 2222-A, FERC has taken an already complicated, difficult situation and made it worse."
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