Rule2023-13287
Tariff Provisions
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
June 22, 2023
Effective
August 21, 2023
Issuing agencies
Energy DepartmentFederal Energy Regulatory Commission
Abstract
Pursuant to section 206 of the Federal Power Act, the Federal Energy Regulatory Commission amends its regulations to require that regional transmission organizations and independent system operators have tariff provisions that permit credit-related information sharing in organized wholesale electric markets to ensure that credit practices in those markets result in jurisdictional rates that are just and reasonable.
Full Text
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<title>Federal Register, Volume 88 Issue 119 (Thursday, June 22, 2023)</title>
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[Federal Register Volume 88, Number 119 (Thursday, June 22, 2023)]
[Rules and Regulations]
[Pages 40696-40707]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2023-13287]
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DEPARTMENT OF ENERGY
Federal Energy Regulatory Commission
18 CFR Part 35
[Docket No. RM22-13-000; Order No. 895]
Tariff Provisions
AGENCY: Federal Energy Regulatory Commission.
ACTION: Final rule.
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SUMMARY: Pursuant to section 206 of the Federal Power Act, the Federal
Energy Regulatory Commission amends its regulations to require that
regional transmission organizations and independent system operators
have tariff provisions that permit credit-related information sharing
in organized wholesale electric markets to ensure that credit practices
in those markets result in jurisdictional rates that are just and
reasonable.
DATES: This rule is effective August 21, 2023.
FOR FURTHER INFORMATION CONTACT:
David Bowers (Technical Information), Office of Energy Policy and
Innovation, 888 First Street NE, Washington, DC 20426, 202-502-8594,
<a href="/cdn-cgi/l/email-protection#420623342b266c002d3527303102242730216c252d34"><span class="__cf_email__" data-cfemail="df9bbea9b6bbf19db0a8baadac9fb9baadbcf1b8b0a9">[email protected]</span></a>.
Patrick Metz (Legal Information), Office of the General Counsel,
888 First Street NE, Washington, DC 20426, 202-502-8197,
<a href="/cdn-cgi/l/email-protection#c696a7b2b4afa5ade88ba3b2bc86a0a3b4a5e8a1a9b0"><span class="__cf_email__" data-cfemail="03536277716a60682d4e66777943656671602d646c75">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION:
ORDER NO. 895
FINAL RULE
(Issued June 15, 2023)
I. Introduction
1. Pursuant to section 206 of the Federal Power Act (FPA),\1\ the
Commission is revising Sec. 35.47 of Title 18 of the Code of Federal
Regulations to require that regional transmission organizations (RTO)
and independent system operators (ISO) have tariff provisions that
permit them to share among themselves credit-related information
regarding market participants in organized wholesale electric
markets.\2\
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\1\ 16 U.S.C. 824e.
\2\ See Credit Reforms in Organized Wholesale Elec. Mkts., Order
No. 741, 75 FR 65942 (Oct. 21, 2010), 133 FERC ] 61,060, at P 1 n.1
(2010) (``[O]rganized wholesale electric markets include energy,
transmission and ancillary service markets operated by'' RTOs/ISOs
that are ``responsible for administering electric energy and
financial transmission rights markets.''), order on reh'g, Order No.
741-A, 76 FR 10492 (Feb. 25, 2011), 134 FERC ] 61,126, reh'g denied,
Order No. 741-B, 135 FERC ] 61,242 (2011).
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2. The ability of RTOs/ISOs to share credit-related information
among themselves will improve their ability to accurately assess market
participants' credit exposure and risks related to their activities
across organized wholesale electric markets. The ability to share such
information should also enable RTOs/ISOs to respond to credit events
more quickly and effectively, minimizing the overall credit-related
risks of unexpected defaults by market participants in organized
wholesale electric markets.
II. Background
A. Previous Commission Action
3. Credit policies of regulated utilities have long been a
component of the Commission's regulatory agenda. For example, when the
Commission issued its pro forma Open Access Transmission Tariff (OATT)
in Order No. 888, the Commission required each transmission provider's
tariff to include reasonable creditworthiness standards.\3\
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\3\ Promoting Wholesale Competition Through Open Access Non-
Discriminatory Transmission Servs. by Pub. Utils.; Recovery of
Stranded Costs by Pub. Utils. & Transmitting Utils., Order No. 888,
61 FR 21540 (May 10, 1996), FERC Stats. & Regs. ] 31,036, at 31,937
(1996) (cross-referenced at 75 FERC ] 61,080) (setting forth section
11 (Creditworthiness) of the pro forma OATT), order on reh'g, Order
No. 888-A, 62 FR 12274 (Mar. 14, 1997), FERC Stats. & Regs. ] 31,048
(cross-referenced at 78 FERC ] 61,220), 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 Pol'y Study Grp. v. FERC, 225 F.3d 667 (D.C. Cir. 2000),
aff'd sub nom. N.Y. v. FERC, 535 U.S. 1 (2002).
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[[Page 40697]]
4. In light of major distress in financial markets during the 2008
financial crisis, the Commission explored the role of credit in the
organized wholesale electric markets and the potential for policy
reforms to strengthen credit practices and mitigate credit-related
risks.\4\ Subsequently, the Commission issued Order No. 741, which
promulgated regulations establishing minimum standards for several
aspects of credit policy in organized wholesale electric markets,
collectively aimed at reducing mutualized default risk, i.e., the risk
that a default by one market participant is unsupported by collateral
and therefore must be socialized among all market participants.\5\ The
Commission explained that risk management and creditworthiness
practices are important to the organized wholesale electric markets
because of this mutualized default risk.\6\
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\4\ Credit Reforms in Organized Wholesale Elec. Mkts., Notice of
Proposed Rulemaking, 75 FR 4310 (Jan. 27, 2010), FERC Stats. & Regs.
] 32,651 (2010).
\5\ Order No. 741, 133 FERC ] 61,060 at PP 4, 12; see also 18
CFR 35.47 (setting forth tariff provisions related to credit
practices in organized wholesale electric markets).
\6\ Order No. 741, 133 FERC ] 61,060 at P 7.
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B. Current Practices
5. RTOs/ISOs assess a market participant's financial condition
using credit-related information provided by market participants and
prospective market participants. RTOs/ISOs generally receive this
credit-related information at specified intervals or upon specific
milestone events, including from: (1) interconnection customers during
the generator interconnection process; \7\ (2) prospective market
participants during the assessment of applications for market
participant status; \8\ (3) market participants during annual or
periodic credit reviews; \9\ and (4) market participants in response to
periodic requests from RTO/ISO credit departments.\10\
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\7\ See, e.g., PJM, Intra-PJM Tariffs, OATT, section 222 (0.0.0)
(requiring PJM to keep confidential any information provided by
interconnection customers).
\8\ See, e.g., SPP OATT, Sixth Revised Volume No. 1, attach. AE
(MPL), section 3.7 (0.0.0) (requiring SPP to validate that
prospective market participants meet SPP's credit requirements).
\9\ See, e.g., NYISO, NYISO Tariffs, NYISO MST, 26.1 MST attach.
K (Minimum Participation Criteria) (4.0.0), section 26.1.2
(requiring customers to demonstrate ongoing compliance with minimum
participation requirements in section 26.1.1).
\10\ See, e.g., PJM, Intra-PJM Tariffs, OATT, attach. Q
(45.0.0), section II.E (requiring market participants to provide
information on an ongoing basis).
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6. Generally, market participants and prospective market
participants do not make the credit-related information provided to
RTOs/ISOs publicly available. For their part, RTOs/ISOs treat market
participants' credit-related information as confidential information
subject to tariff provisions that limit the use of this information to
specific purposes, limiting the ability of RTOs/ISOs to share this
information with other parties, including other RTOs/ISOs.\11\
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\11\ See, e.g., ISO-NE, Transmission, Markets, and Services
Tariff, attach. D (ISO-NE Information Policy) (22.0.0), section 2.0
(requiring ISO-NE entities to use Confidential Information ``solely
to perform their obligations under the NEPOOL Agreement and the
Participants Agreement'').
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7. If a market participant defaults and its collateral is
insufficient to cover the amount of its outstanding obligations, the
remaining cost of those obligations is spread across the organized
wholesale electric market's market participants (i.e., the default is
``mutualized'').\12\ An RTO's/ISO's ability to reduce mutualized
default risk can help to prevent defaults and, when defaults do occur,
minimize the costs resulting from such defaults.
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\12\ See, e.g., PJM, Intra-PJM Tariffs, OA, section 15.2
(7.0.0), section 15.2.2; SPP, OATT, Sixth Revised Volume No. 1,
attach. L, section V (1.0.0).
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C. Technical Conference
8. In February 2021, Commission staff convened a technical
conference to discuss principles and best practices for credit risk
management in organized wholesale electric markets. Panelists at the
technical conference included credit risk experts, market participants
with experience in RTO/ISO credit policy compliance, and RTO/ISO risk
officers. Among other topics, the technical conference addressed
whether RTOs/ISOs could share market participants' credit-related
information with one another, whether market participants had expressed
concern about RTOs/ISOs sharing such information, whether there were
rules or other barriers that prevented RTOs/ISOs from sharing such
information, and how the Commission could address concerns regarding
the confidential treatment of such information.\13\
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\13\ See Supplemental Notice of Technical Conference, RTO/ISO
Credit Principles and Practices, Docket No. AD21-6-000, et al. (Feb.
10, 2021).
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9. As relevant here, panelists at the technical conference stated
that there could be risk management benefits from sharing market
participants' credit-related information among RTO/ISO credit
departments.\14\ Additionally, the ISO/RTO Council (IRC) \15\ stated in
its post-technical conference comments that credit-related information
sharing among RTOs/ISOs would improve the RTOs'/ISOs' ability to
anticipate and respond to credit risks or prevent the occurrence of
negative credit events.\16\ The IRC explained that the primary
obstacles to RTOs/ISOs sharing credit-related information are: (1) the
confidentiality provisions included in RTO/ISO OATTs; and (2) the lack
of specific Commission authorization or policy favoring credit-related
information sharing among RTOs/ISOs.\17\ The IRC therefore recommended,
among other things, that the Commission require RTOs/ISOs to adopt
tariff revisions permitting RTOs/ISOs to share credit-related
information with other RTOs/ISOs and proposed certain tariff
language.\18\
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\14\ See RTO/ISO Credit Principles and Practices, Technical
Conference, Docket No. AD21-6-000, et al., Tr. 100:24-102:20, 106:1-
24 (Bloczynski) (Feb. 25, 2021); id. at Tr. 102:25-104:5 (Brown);
id. at Tr. 104:7-105:9 (Prevratil); id. at Tr. 105:12-24 (Seghesio).
For example, one panelist explained that it would be helpful for an
RTO/ISO credit department to know that a market participant is
experiencing financial distress in another organized wholesale
market in which it transacts because the RTO/ISO credit department
could then focus its attention on whether the market participant's
financial distress in another market could impact its own markets.
Id. at Tr. 104:21-105:6 (Prevratil). Further, one panelist stated
that credit-related information sharing would bring additional
transparency to organized wholesale electric markets, which would
build confidence in those markets to the benefit of market
participants and consumers. See id. at Tr. 30:15-23, 58:1-9
(Heinle).
\15\ The IRC is composed of Commission-jurisdictional RTOs/ISOs,
including PJM Interconnection, L.L.C. (PJM), ISO New England Inc.
(ISO-NE), California Independent System Operator Corporation
(CAISO), New York Independent System Operator, Inc. (NYISO),
Midcontinent Independent System Operator, Inc. (MISO), and Southwest
Power Pool, Inc. (SPP), as well as three transmission system
operators that are not Commission-jurisdictional for purposes of
this final rule, including Electric Reliability Council of Texas,
Inc. (ERCOT), the Alberta Electric System Operator (AESO), and the
Independent Electricity System Operator (IESO).
\16\ Comments of the ISO/RTO Council, RTO/ISO Credit Principles
and Practices, Docket No. AD21-6-000, et al., at 2, 5-6 (filed June
7, 2021).
\17\ Id. at 5.
\18\ Id. at 6-8.
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D. Notice of Proposed Rulemaking
10. On July 28, 2022, the Commission issued a notice of proposed
rulemaking pursuant to the Commission's authority under FPA section
206.\19\ The Commission preliminarily found that it is unjust and
unreasonable for RTOs/ISOs to be unable to share with each other
credit-related information about their market participants, and that
tariff provisions that prohibit or otherwise limit an RTO/ISO from
sharing credit-related information are unjust and unreasonable. The
Commission
[[Page 40698]]
reasoned that such tariff provisions can hinder an RTO's/ISO's ability
to evaluate a market participant's creditworthiness and respond to
credit events, and thus, in turn, can hinder its ability to prevent or
mitigate default by market participants. The Commission further
reasoned that, because the costs of such defaults typically are borne
by non-defaulting market participants, an RTO's/ISO's lack of access to
credit-related information may lead to unjust and unreasonable rates
for its market participants.\20\
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\19\ Credit-Related Info. Sharing in Organized Wholesale Elec.
Mkts., Notice of Proposed Rulemaking, 87 FR 48118 (Aug. 8, 2022),
180 FERC ] 61,048 (2022) (NOPR).
\20\ Id. P 14.
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11. To address RTOs'/ISOs' access to credit-related information,
the Commission proposed in the NOPR to amend its regulations to require
RTOs/ISOs to include in their OATTs provisions that permit them to
share market participants' credit-related information with other RTOs/
ISOs for the purpose of credit risk management and mitigation. The
Commission also proposed in the NOPR to permit the receiving RTO/ISO to
use market participant credit-related information received from another
RTO/ISO to the same extent and for the same purposes that the receiving
RTO/ISO may use credit related information from its own market
participants.\21\
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\21\ Id. P 21.
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12. Initial comments were due on or before October 7, 2022; reply
comments were due on or before November 7, 2022.\22\
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\22\ The following parties submitted initial comments: Dominion
Energy Services, Inc., on behalf of Virginia Electric and Power
Company and Dominion Energy South Carolina, Inc. (Dominion); Edison
Electric Institute (EEI); Electric Power Supply Association (EPSA);
the Energy Trading Institute (ETI); FirstEnergy Utility Companies
and East Kentucky Power Cooperative, Inc. (Indicated PJM Utilities);
IRC; Market Monitoring Unit of the Southwest Power Pool, Inc. (SPP
MMU); and New England Power Pool Participants Committee (NEPOOL).
The following parties submitted reply comments: IRC and Kiera
Howard.
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13. In general, commenters support the NOPR proposal to permit
RTOs/ISOs to share credit-related information among themselves. For
example, IRC states that, because market participants operate in
multiple organized wholesale electric markets, the NOPR proposal would
enhance RTOs'/ISOs' ability to accurately assess market participants'
credit exposure. IRC also argues that the NOPR proposal would assist
RTOs/ISOs in their efforts to respond more quickly to credit events and
thereby minimize overall credit-related risks of unexpected defaults by
market participants in organized wholesale electric markets.\23\ EEI
states that the NOPR proposal would enhance RTOs'/ISOs' ability to
evaluate market participants' creditworthiness and respond to credit
events, which will prevent or mitigate defaults and limit unnecessary
costs incurred by non-defaulting market participants.\24\
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\23\ IRC Initial Comments at 2.
\24\ EEI Comments at 3.
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14. Indicated PJM Utilities and ETI each offers qualified support
for the NOPR proposal. Indicated PJM Utilities generally agrees with
the NOPR proposal to allow RTOs/ISOs to share credit-related
information among themselves and commends the Commission for proposing
solutions consistent with stakeholder feedback at the technical
conference.\25\ ETI states that, with certain guiding principles in
place, credit-related information sharing among RTOs/ISOs will enhance
credit risk assessment efforts.\26\ EPSA argues that credit-related
information sharing should not be conducted on a routine basis, though
it concedes that there may be some instances in which it would be
appropriate.\27\
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\25\ Indicated PJM Utilities Comments at 2.
\26\ ETI Comments at 2.
\27\ EPSA Comments at 5.
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III. Need for Reform
15. We find that it is unjust and unreasonable for RTOs/ISOs to be
unable to share with each other credit-related information about their
market participants, and that tariff provisions that prohibit or
otherwise limit an RTO/ISO from sharing credit-related information are
unjust and unreasonable. Such tariff provisions can hinder an RTO's/
ISO's ability to evaluate a market participant's creditworthiness and
to respond to credit events, and thus, in turn, can hinder its ability
to prevent or mitigate default by market participants.\28\ Because the
costs of such defaults typically are borne by non-defaulting market
participants, an RTO's/ISO's lack of access to credit-related
information may lead to unjust and unreasonable rates for its market
participants. Therefore, we find that removing such tariff provisions
will help minimize the costs of mutualized defaults and ensure just and
reasonable rates.
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\28\ NOPR, 180 FERC ] 61,048 P 14.
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16. RTOs/ISOs are responsible for credit risk management as the
entities responsible for administering organized wholesale electric
markets, and perform this responsibility by instituting, maintaining,
and enforcing policies that balance the need for robust market
participation and liquidity while seeking to minimize mutual default
risk.\29\ In order to manage credit risk in the organized wholesale
electric markets, RTOs/ISOs must have adequate information about their
market participants' financial standing and their business and
operational activities in other organized wholesale electric markets.
Having this information will allow each RTO/ISO to assess those market
participants' default risk more effectively. Generally speaking,
however, each RTO/ISO currently has access only to publicly available
information and to the credit-related information provided by its own
market participants. Therefore, we conclude that RTOs/ISOs may have
limited visibility, if any, into their market participants' activities
in other organized wholesale electric markets.
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\29\ Id. P 15.
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17. Additionally, market participants increasingly operate in
multiple organized wholesale electric markets, whether directly or
through affiliated entities, and their trading activities have become
more complex and sophisticated.\30\ These developments have complicated
the ability of any individual RTO/ISO credit department to develop a
complete, accurate, and up-to-date picture of a market participant's
overall financial condition due to real or perceived barriers to
information sharing among RTOs/ISOs. Negative credit events affecting a
market participant's credit standing in one organized wholesale
electric market may impact its credit standing in other markets.
Therefore, an RTO/ISO that cannot obtain market participants' credit-
related information arising from their activities in other organized
wholesale electric markets may not be able to effectively protect its
organized wholesale electric market from mutualized default risk.
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\30\ RTO/ISO Credit Principles and Practices, Technical
Conference, Docket No. AD21-6-000, et al., Tr. 30:12-14 (Heinle)
(Feb. 25, 2021).
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18. Currently, RTO/ISO OATTs generally contain provisions that
treat a market participant's credit-related information as confidential
information and, in most instances, prohibit an RTO/ISO from sharing
that credit-related information with other RTOs/ISOs without the
consent of the market participant.\31\ The Commission finds that such
tariff provisions effectively allow a market participant to limit the
amount and quality of information that
[[Page 40699]]
an RTO/ISO may access and use to assess that market participant's
financial standing, and that these provisions therefore pose an unjust
and unreasonable barrier to credit risk management and mitigation by
the RTOs/ISOs.\32\
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\31\ See, e.g., ISO-NE, Transmission, Markets, and Services
Tariff, attach. D (ISO-NE Information Policy) (22.0.0), section
2.1(e) (designating information disclosed by a market participant to
satisfy ISO-NE's minimum criteria for market participation as
Confidential Information in certain circumstances); PJM, Intra-PJM
Tariffs, OATT, attach. Q (45.0.0), section III.C (same).
\32\ See, e.g., RTO/ISO Credit Principles and Practices,
Technical Conference, Docket No. AD21-6-000, et al., Tr. 116:6-10
(Brown) (Feb. 25, 2021) (suggesting that MISO's OATT prohibits
disclosure of a MISO market participant's financial distress even if
that market participant is on the verge of default).
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IV. Discussion
19. Therefore, to address limitations to RTOs'/ISO' access to
potentially relevant credit-related information, we amend Commission
regulations to require that each RTO/ISO have tariff provisions that
permit RTOs/ISOs to share market participants' credit-related
information with other RTOs/ISOs for the purpose of credit risk
management and mitigation.
20. Specifically, we adopt the proposed regulations to: (1) permit
RTOs/ISOs to share with each other credit-related information; (2)
permit RTOs/ISOs to use market participant credit-related information
received from other RTOs/ISOs to the same extent and for the same
purpose as information received from its own market participants; and
(3) require that an RTO/ISO that receives credit-related information
from another RTO/ISO keep that information confidential as it would any
other credit-related information received directly from one of its own
market participants.
21. The regulations we adopt will allow the RTOs/ISOs to share
credit-related information among themselves as necessary, helping them
to better monitor the ongoing risks in their markets that may change
quickly, but without creating uncertainty among the RTOs/ISOs about
what information is permissible to share. In addition, credit-related
information sharing will help RTOs/ISOs to carry out their credit risk
management responsibilities, which, in turn, will benefit all market
participants and their customers that ultimately bear the cost of
mutualized default risk.
22. We respond to objections to or requests for clarification on
the NOPR proposal to allow credit-related information sharing in
organized wholesale electric markets below.
A. Shareable Credit-Related Information
1. NOPR
23. The Commission explained that its proposal would allow RTOs/
ISOs to share credit-related information, including: (1) lists of
market participants with positions in that market; (2) reports and
metrics around risk and credit exposures; (3) disclosure that a market
participant or affiliate has defaulted on any of its financial or
contractual obligations, failed to pay invoices on a timely basis, or
failed to meet a collateral call; (4) information regarding a market
participant's or its affiliate's unresolved credit/collateral issues;
(5) information indicating that a market participant or its affiliate
has an increased risk of default, such as instances where a market
participant or its affiliate has experienced a material adverse
condition or material adverse change under an RTO/ISO OATT or related
agreement; and (6) any other information on a market participant or its
affiliate that indicates a possible material adverse change in
creditworthiness or financial status or an unreasonable credit
risk.\33\ The Commission sought comment on whether it should impose
restrictions on the types of credit-related information that RTOs/ISOs
may share with one another.\34\
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\33\ NOPR, 180 FERC ] 61,048 P 22.
\34\ Id. PP 22, 30.
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2. Comments
24. EEI and Indicated PJM Utilities request that the Commission
define ``credit-related information'' more precisely than in the NOPR
proposal. EEI states that RTOs/ISOs otherwise may interpret ``credit-
related information'' differently,\35\ while Indicated PJM Utilities
requests that the Commission establish a ``standardized list of
documentation'' that RTOs/ISOs could collect from market
participants.\36\ By contrast, IRC requests that the Commission decline
to define credit-related information,\37\ while SPP MMU argues that it
would be nearly impossible to create a distinct set of all-
encompassing, currently applicable circumstances in which credit-
related information sharing would be appropriate.\38\
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\35\ EEI Comments at 3.
\36\ Indicated PJM Utilities Comments at 13-14.
\37\ IRC Reply Comments at 3.
\38\ SPP MMU Comments at 4.
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25. EPSA states that phases such as ``unresolved credit/collateral
issues'' and ``an increased risk of default, such as a material adverse
change or change in creditworthiness'' are too vague, and that the
former may encompass billing disputes between the market participant
and RTO/ISO and not necessarily an increased credit risk.\39\ Dominion
likewise states that the Commission should not allow RTOs/ISOs to share
such information unless it represents a material adverse change that is
confirmed and no longer subject to dispute.\40\
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\39\ EPSA Comments at 6-7.
\40\ Dominion Comments at 4.
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26. Dominion expresses concern that RTOs/ISOs might abuse their
discretion and share credit-related information that might wrongfully
prevent a market participant from participating in the market,
particularly with respect to the Commission's proposal to allow RTOs/
ISOs to share with other RTOs/ISOs ``any other information on a market
participant or its affiliate that indicates a possible material adverse
change in creditworthiness or financial status or an unreasonable
credit risk.'' \41\ Dominion argues that RTOs/ISOs should only be able
to share ``bankruptcy filings, confirmed undisputed material financial
defaults in their wholesale energy markets or bilateral arrangements,
disciplinary actions taken for market activity not in keeping with
[Commission] regulations or the RTO/ISO/market operator's rules,
findings of material defalcation, market manipulation or fraud, and
findings of violations of federal and state regulations regarding
energy commodities, [or Commodity Futures Trading Commission] or
[Commission] regulations.'' \42\
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\41\ Id. at 5.
\42\ Id. at 6.
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27. Indicated PJM Utilities requests that the Commission adopt an
``active participation'' requirement, according to which an RTO/ISO
should not receive credit-related information unless it demonstrates
that the relevant entity is a market participant, or a prospective or
former market participant. Indicated PJM Utilities reasons that to
preserve confidentiality to the greatest extent possible, RTOs/ISOs
should only share credit-related information when it is relevant to
evaluating a credit-related risk, and that other RTOs/ISOs have no need
of the information if the entity is not a former, current, or
prospective market participant.\43\
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\43\ Indicated PJM Utilities Comments at 2-5.
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28. Dominion and Indicated PJM Utilities each also requests
clarification as to what credit-related information RTOs/ISOs should be
allowed to share among themselves. Dominion states that, with respect
to the Commission's proposal to allow RTOs/ISOs to disclose to other
RTOs/ISOs that a market participant or affiliate has defaulted on any
of its financial or contractual obligations, failed to pay invoices on
a timely basis, or failed to meet a collateral call, it is not clear
whether an RTO/ISO may only share credit-related
[[Page 40700]]
information related to obligations owed to the RTO/ISO or whether an
RTO/ISO might also share credit-related information related to
obligations owed by the market participant to unrelated third
parties.\44\ Indicated PJM Utilities argues that RTOs/ISOs should only
share credit-related information received directly from a market
participant, and should not share information received from another
RTO/ISO.\45\
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\44\ Dominion Comments at 4-5.
\45\ Indicated PJM Utilities Comments at 13-14.
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29. Finally, EPSA expresses concern that the NOPR's definition of
credit-related information encompasses information about a market
participant's affiliates, and states that this could be inappropriate
because some such affiliates are fully distinct, standalone companies
with separate debt and equity structures.\46\
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\46\ EPSA Comments at 6.
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3. Commission Determination
30. We set forth a list of examples of the types of credit-related
information that an RTO/ISO may share, as proposed in the NOPR, but
this list is illustrative and we decline to adopt a restrictive or
exclusive list. We find that RTOs/ISOs should be allowed to share
credit-related information, including: (1) lists of market participants
with positions in that market; (2) reports and metrics around risk and
credit exposures; (3) disclosure that a market participant or affiliate
has defaulted on any of its financial or contractual obligations,
failed to pay invoices on a timely basis, or failed to meet a
collateral call; (4) information regarding a market participant's or
its affiliate's unresolved credit/collateral issues; (5) information
indicating that a market participant or its affiliate has an increased
risk of default, such as instances where a market participant or its
affiliate has experienced a material adverse condition or material
adverse change under an RTO/ISO OATT or related agreement; and (6) any
other information on a market participant or its affiliate that
indicates a possible material adverse change in creditworthiness or
financial status or an unreasonable credit risk.
31. This list is illustrative and not exhaustive. We believe that
the list provides sufficient examples of the types of credit-related
information that may help RTOs/ISOs carry out their credit risk
management responsibilities.
32. We recognize that EPSA believes that the list above is vague
and that several commenters (including Dominion and Indicated PJM
Utilities) request limitations on or clarifications to the kinds of
credit-related information that RTOs/ISOs may share among themselves.
Because we cannot reasonably foresee every circumstance in which RTOs/
ISOs may seek to share credit-related information, nor determine every
type of credit-related information that may be useful to share, we
decline to adopt an exclusive list restricting the type of credit-
related information that may be shared. We find it reasonable to allow
RTOs/ISOs, as independent entities, to exercise their discretion in
determining the kinds of credit-related information to share with each
other. This approach is consistent with the Commission's approach in
creditworthiness matters. In Order No. 741, the Commission declined to
adopt a list of events that qualified as a ``material adverse change,''
because it would limit the market administrator, i.e., the RTO/ISO. The
Commission reasoned: ``Experience has demonstrated that unforeseen
circumstances can arise, which will require action to protect the
markets from ongoing disruption.'' \47\
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\47\ Order No. 741, 133 FERC ] 61,060 at P 150.
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33. We decline to define credit-related information more
specifically as requested by EEI and Indicated PJM Utilities.\48\ We
find that a specific, restrictive definition would unnecessarily narrow
the information that RTOs/ISOs could share and would unnecessarily
limit RTOs'/ISOs' discretion in an area that is well within their
responsibility and expertise.
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\48\ EEI Comments at 3; Indicated PJM Utilities Comments at 13-
14.
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34. We decline to preclude RTOs/ISOs from sharing credit-related
information that is subject to dispute, as requested by EPSA and
Dominion. We find that imposing such a limitation could prevent RTOs/
ISOs from timely sharing credit-related information and lessen the
RTOs'/ISOs' ability to prevent or mitigate defaults. Allowing only
undisputed information to be shared may also incent market participants
to pursue disputes as a means of precluding other RTOs/ISOs from
receiving information about their credit-related activities in another
RTO/ISO. We expect that RTOs/ISOs sharing credit-related information
will provide relevant details necessary for the receiving RTO/ISO to
assess potential credit risk effects, including, as appropriate, that
the information is subject to dispute. We clarify that RTOs/ISOs
receiving credit-related information are permitted to seek clarifying
information from the sending RTO/ISO, if necessary. Further, we believe
that as independent entities, the RTO/ISO credit departments are
capable of impartially assessing credit-related information they
receive and responding effectively, as appropriate.
35. We decline to require that credit-related information-sharing
be subject to an active participation requirement as requested by
Indicated PJM Utilities. Indicated PJM Utilities have not shown what
interest or incentive an RTO/ISO would have to use credit-related
information received from another RTO/ISO related to an entity that is
not among the RTO/ISO's former, current, or prospective market
participants. Further, as to concerns about the confidentiality of
information that an RTO/ISO might obtain regarding an entity that is
not among its market participants, we note that RTOs/ISOs handle
substantial amounts of their market participants' commercially
sensitive information and have established practices for protecting its
confidentiality. As such, while this final rule will allow RTOs/ISOs to
share credit-related information among themselves, we are not persuaded
that the sharing of such information among other RTOs/ISOs materially
increases the risk of its disclosure beyond the RTOs/ISOs.
36. Further, we see practical issues with limiting the scope of
market participant credit-related information as requested by Indicated
PJM Utilities. For example, it may be valuable in some instances for
RTOs/ISOs to share with one another certain kinds of credit-related
information on a routine basis, such as lists of market participants
with positions in that market (category (1) above). For such documents
that include information about a large number of market participants,
it may not be feasible to verify each market participant's ``active''
status in the markets operated by the recipient RTO/ISO, or produce
multiple customized reports for each RTO/ISO including only the
recipient RTO's/ISOs' former, current, and prospective market
participants. In other situations, an RTO/ISO might share reports
including credit-related information related to multiple market
participants (category (2) above), raising similar concerns. But as
explained below, RTOs/ISOs must treat credit-related information they
receive from another RTO/ISO under this final rule as they would
credit-related information they received from their own market
participants.
37. With respect to our proposal to allow RTOs/ISOs to disclose
that a market participant or affiliate has defaulted on any of its
financial or contractual obligations, failed to pay
[[Page 40701]]
invoices on a timely basis, or failed to meet a collateral call
(category (3) above), we decline Dominion's request that we limit such
disclosures to obligations owed to the RTO/ISO and not also to
unrelated third parties. We find that information about a market
participant's credit activity outside of the RTO/ISO markets may be
relevant to its creditworthiness within the RTO/ISO markets. RTOs/ISOs
often collect from their market participants credit-related information
about a market participant's obligations owed to third parties. Thus,
an RTO/ISO may find such information relevant as it assesses credit
risks.\49\ For similar reasons, we also decline Indicated PJM
Utilities' request that we limit the credit-related information that an
RTO/ISO may share to information collected directly from its own market
participants. Further, we believe that adopting Indicated PJM
Utilities' recommendation could prove counterproductive by causing
uncertainty in RTO/ISO credit departments on which types of information
are permissible to share during fast-moving credit events that results
in RTOs/ISOs not timely sharing credit-related information.
---------------------------------------------------------------------------
\49\ See, e.g., Indicated PJM Utilities Comments at 8-9
(indicating that NYISO requires market participants to submit
information related to any ``material defaults or bankruptcies by
the [market participant] or its predecessors, subsidiaries, or
affiliates within the last five years'' or ``material changes in
financial status'').
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38. Finally, in response to EPSA's concern with the inclusion of
credit-related information relating to a market participant's
affiliate, we clarify that the definition of affiliates in this context
is to be governed by the definition of affiliate provided in the RTO's/
ISO's OATT for purposes of determining market participants'
creditworthiness.\50\ If an affiliate's financial standing changes in a
way that requires a market participant to post additional collateral,
for example, that information may be relevant in another RTO's/ISO's
credit risk assessment. To the extent that the definitions of affiliate
vary materially from one RTO/ISO to another, we reiterate our belief
that RTO/ISO credit departments that receive credit-related information
are capable of impartially assessing it and responding effectively and
appropriately.
---------------------------------------------------------------------------
\50\ See, e.g., SPP, OATT, Sixth Revised Volume No. 1, attach.
X, section 2.1 (defining ``Affiliate'' and ``Affiliated Credit
Customers''); id. section 4.3.4.1 (requiring SPP to determine
creditworthiness of Affiliated Credit Customers collectively).
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B. Discretion for RTOs/ISOs
1. NOPR
39. The Commission proposed to allow an RTO/ISO to use credit-
related information received from another RTO/ISO to the same extent
and for the same purposes as that RTO/ISO may use credit-related
information collected from its own market participants.\51\ The
Commission explained that this would allow RTOs/ISOs the discretion to
determine what credit-related information it would share with other
RTOs/ISOs, as well as under what circumstances and on what timeline it
would do so.\52\
---------------------------------------------------------------------------
\51\ NOPR, 180 FERC ] 61,048 P 21.
\52\ Id. P 27.
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40. The Commission stated that it believed the NOPR proposal would
allow RTOs/ISOs to gain additional visibility into their market
participants' financial condition and to administer organized wholesale
electric markets more effectively both as part of ongoing ``business-
as-usual'' credit risk management practices and during market or credit
events.\53\ The Commission preliminarily found that RTOs/ISOs would
benefit from the ability to discuss the creditworthiness of specific
market participants, and that permitting RTOs/ISOs to share credit-
related information with other RTOs/ISOs would allow these discussions
to take place and better inform RTOs/ISOs in the management of credit
risk in the organized wholesale electric markets on an ongoing
basis.\54\ The Commission also preliminarily found that credit-related
information sharing would help RTOs/ISOs prevent or mitigate losses in
the event that a market participant experiences financial distress, and
potentially help RTOs/ISOs prevent default in one organized wholesale
electric market from triggering default in another.\55\
---------------------------------------------------------------------------
\53\ Id. P 24.
\54\ Id. P 25.
\55\ Id. P 26.
---------------------------------------------------------------------------
41. Finally, the Commission also stated that the NOPR would not
change the existing discretion an RTO/ISO has to act on credit-related
information, regardless of its source.\56\
---------------------------------------------------------------------------
\56\ Id. P 28.
---------------------------------------------------------------------------
2. Comments
42. IRC argues that RTOs/ISOs should be able to use credit-related
information to the same extent and for the same purposes as other
credit-related information. IRC contends that a final rule should allow
RTO/ISO credit risk personnel to focus on activities that help achieve
the objectives set forth in the NOPR, i.e., to identify and manage
credit risks and protect non-defaulting market participants from the
consequences of credit defaults.\57\ SPP MMU also argues that RTOs/ISOs
should have discretion on how to use credit-related information
received from another RTO/ISO.\58\ By contrast, Dominion opposes what
it calls ``unfettered discretion'' for RTOs/ISOs, arguing that the
Commission instead should afford RTOs/ISOs only ``reasonable
discretion.'' \59\
---------------------------------------------------------------------------
\57\ IRC Initial Comments at 3-5.
\58\ SPP MMU Comments at 4.
\59\ Dominion Comments at 5-6.
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43. NEPOOL contends that the Commission should require each RTO/ISO
to specify in compliance filings to a potential final rule what
criteria the RTO/ISO will use to determine when it will share credit-
related information and what types of information it will share.\60\
ETI likewise states that RTOs/ISOs should only share credit-related
information when triggered by certain universally-applied metrics,
e.g., percentage of exposure/collateral posted, material changes in
know-your-customer or risk management policies.\61\ In reply, IRC
disagrees and requests that the Commission not specify circumstances in
which RTOs/ISOs may or may not share credit-related information,
arguing that each RTO/ISO has the responsibility to manage credit risks
and should be granted the flexibility to do so.\62\
---------------------------------------------------------------------------
\60\ NEPOOL Comments at 5-6.
\61\ ETI Comments at 4.
\62\ IRC Reply Comments at 3.
---------------------------------------------------------------------------
44. ETI argues that RTOs/ISOs should be careful about sharing
credit-related information during system stress events, because losses
in one organized wholesale electric market could lead to collateral
calls in other markets that might exacerbate the situation. ETI
therefore states that RTOs/ISOs should not share information related to
margin or collateral calls issued to market participants.\63\
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\63\ ETI Comments at 3-5.
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45. EPSA argues that an RTO/ISO that receives credit-related
information from another RTO/ISO may misunderstand that information and
take action erroneously in response. EPSA therefore argues that market
participants should have a minimum window of time during which to
resolve billing disputes before an RTO/ISO may share information
related to that dispute.\64\
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\64\ EPSA Comments at 5-7.
---------------------------------------------------------------------------
46. Finally, ETI argues that a potential final rule should
encourage collaboration and coordination within each RTO/ISO between
its operations,
[[Page 40702]]
planning, and credit departments. ETI cites the example of a default
that it claims was caused by construction taking place during a
critical outage, and claims that the outage could have been delayed had
more robust communication occurred within the RTO/ISO.\65\
---------------------------------------------------------------------------
\65\ ETI Comments at 3, 6-7.
---------------------------------------------------------------------------
3. Commission Determination
47. We adopt the proposal set forth in the NOPR that, in sharing
credit-related information under the adopted regulations, an RTO/ISO
has discretion as to what credit-related information it chooses to
provide to other RTOs/ISOs, as well as under what circumstances and on
what timeline it chooses to do so. Similarly, as noted above, an RTO/
ISO that receives credit-related information pursuant to the
regulations adopted in this final rule may use that information as it
would credit-related information from any other source. We find that,
as the independent entities with the most insight into and knowledge of
what credit-related information would be useful to share, RTOs/ISOs
should have flexibility to best accomplish the intended purpose of the
rule, which aims to remove unjust and unreasonable barriers that
restrict communication of credit-related information between the RTOs/
ISOs.\66\ We find that providing RTOs/ISOs flexibility about what
credit information to share and how to use credit-related information
it receives will improve the RTOs'/ISOs' ability to mitigate credit
risks without creating uncertainty for RTOs/ISOs as to the manner in
which they are sharing credit-related information.
---------------------------------------------------------------------------
\66\ Moreover, granting RTOs/ISOs this level of discretion is
consistent with our precedent. See, e.g., N.Y. Indep. Sys. Operator,
Inc., 170 FERC ] 61,054, at P 30 (2020) (``We agree with NYISO that
the proposed tariff language will allow NYISO the reasonable
discretion to evaluate individual facts and circumstances, as
necessary, to protect the NYISO-administered markets without
limiting NYISO to act only in specific scenarios of increased credit
risk enumerated in the tariff.'').
---------------------------------------------------------------------------
48. This approach will provide an RTO/ISO the discretion to
determine what credit-related information it would share with other
RTOs/ISOs, as well as under what circumstances and on what timeline it
would do so. Gaining additional visibility into their market
participants' financial condition will help RTOs/ISOs to administer
organized wholesale electric markets more effectively both as part of
ongoing ``business-as-usual'' credit risk management practices and
during market or credit events. RTOs/ISOs will be able to discuss with
each other the creditworthiness of specific market participants, and
nothing in this final rule precludes these discussions as a means to
better inform RTOs/ISOs in the management of credit risk on an ongoing
basis.
49. We reject Dominion's characterization of the discretion we
afford the RTOs/ISOs as ``unfettered.'' As an initial matter, RTOs/ISOs
may share credit-related information only for the purpose of credit
risk management and mitigation. An RTO's/ISO's discretion is further
constrained by its OATT, because RTOs/ISOs may only use the credit-
related information shared under this final rule to the same extent and
for the same purposes as that RTO/ISO may use credit-related
information collected from its own market participants. Therefore, an
RTO/ISO sharing a market participant's credit-related information does
not necessarily entail negative consequences for a market participant,
let alone automatic consequences. The RTO/ISO must follow rules and
procedures set forth in its Commission-approved OATT, and market
participants are therefore provided the safeguards set forth in the
OATT. If the RTO/ISO takes action that violates its OATT, the entity
whose information was shared may turn to dispute resolution mechanisms
available to it \67\ or submit a complaint under FPA section 206. The
Commission has the authority to ensure that RTOs/ISOs act in a manner
consistent with their OATTs. For the same reasons, we also reject
NEPOOL and ETI's requests for written criteria and metrics,
respectively, which we believe would unreasonably constrain the RTOs'/
ISOs' discretion.
---------------------------------------------------------------------------
\67\ See, e.g., SPP OATT, Sixth Revised Volume No. 1, attach. X,
section 1.6 (subjecting disputes regarding SPP's Credit Policy to
the dispute resolution mechanism in the SPP OATT).
---------------------------------------------------------------------------
50. We also reject EPSA's argument that an RTO/ISO might
misinterpret credit-related information it receives and take erroneous
action as a consequence. EPSA's concerns are at best speculative and
granting their requests would unreasonably constrain RTOs'/ISOs'
discretion as information on margin or collateral calls may be useful
in understanding a market participant's market losses that require
additional collateral and on which market participants could have
potential liquidity problems due to margin calls. We again reiterate
that RTO/ISO credit departments that receive credit-related information
are capable of impartially assessing it and responding effectively and
appropriately. We decline to preclude RTOs/ISOs from sharing
information about margin or collateral calls during system stress
events as suggested by ETI. A market participant's failure to make a
margin or collateral call is highly relevant to its creditworthiness,
particularly during stress events.
51. Finally, we reject ETI's request that the Commission encourage
collaboration and coordination within each RTO/ISO because it is
outside the scope of this proceeding, which is focused on credit-
related information sharing among RTOs/ISOs and not on internal
communications within each RTO/ISO.
C. Consent of or Notice to Market Participants
1. NOPR
52. The Commission preliminarily found an RTO's/ISO's sharing of a
market participant's credit-related information must not be conditioned
on the consent of the market participant.\68\ The Commission stated
that existing OATT provisions implicitly impose a barrier to credit-
related information sharing, as the OATT provisions treat market
participants' credit-related information as confidential information
and, in most instances, prohibit an RTO/ISO from sharing credit-related
information with other RTOs/ISOs without the consent of the market
participant. The Commission further observed that these provisions
effectively allow a market participant to limit the amount and quality
of information that an RTO/ISO may access and use to assess that market
participant's financial standing.\69\
---------------------------------------------------------------------------
\68\ NOPR, 180 FERC ] 61,048 P 23.
\69\ Id. P 19.
---------------------------------------------------------------------------
53. The Commission also proposed that an RTO/ISO would not be
required to notify its own market participants before sharing their
credit-related information because an RTO's/ISO's OATT, as revised,
would provide notice that credit-related information could be shared on
a confidential basis with other RTOs/ISOs for the purpose of credit
risk management and mitigation.\70\ The Commission stated that
permitting RTOs/ISOs to share credit-related information without their
having to obtain a market participant's consent or to provide notice
would facilitate expeditious information sharing and would thus allow
for improved risk mitigation.
---------------------------------------------------------------------------
\70\ Id. P 23.
---------------------------------------------------------------------------
2. Comments
54. IRC and Indicated PJM Utilities express support for the NOPR
proposal not to condition an RTO's/ISO's ability
[[Page 40703]]
to share credit-related information on the RTO's/ISO's obtaining prior
consent from or providing notice to market participants.\71\
---------------------------------------------------------------------------
\71\ IRC Initial Comments at 3, 4 n.9; Indicated PJM Utilities
Comments at 2.
---------------------------------------------------------------------------
55. While no party requests that the Commission require RTOs/ISOs
to obtain market participants' prior consent, EPSA and NEPOOL each
argue that the Commission should require an RTO/ISO to provide notice
when the RTO/ISO shares the market participants' credit-related
information. According to EPSA, RTOs/ISOs should notify market
participants immediately upon sharing their credit-related
information.\72\ NEPOOL contends that timely notice would suffice,
e.g., within 30 days of sharing, and argues that this would not burden
RTOs/ISOs because they could use electronic means to provide such
notice.\73\
---------------------------------------------------------------------------
\72\ EPSA Comments at 5.
\73\ NEPOOL Comments at 7-8.
---------------------------------------------------------------------------
56. Finally, Indicated PJM Utilities argues that the Commission
should require RTOs/ISOs to establish recordkeeping requirements in
accordance with which the RTO/ISO that shares credit-related
information with another RTO/ISO would be required to document: (1)
what credit-related information it shared; (2) the date on which it was
shared; and (3) the recipient RTO/ISO. Indicated PJM Utilities contends
that the inclusion of such requirements would create an auditable
record that would provide additional security to market
participants.\74\
---------------------------------------------------------------------------
\74\ Indicated PJM Utilities Comments at 14-15.
---------------------------------------------------------------------------
3. Commission Determination
57. We adopt the findings, set forth in the NOPR, that an RTO/ISO
must be allowed to share credit-related information without either
obtaining the prior consent of market participants or providing
specific notice to market participants.
58. We do not require consent for the sharing of credit-related
information because a consent requirement would hinder information
sharing. A market participant would have little incentive to provide
consent and indeed could effectively limit RTOs'/ISOs' access to
credit-related information by withholding its consent--a particular
concern if a market participant faces a pending credit event. Further,
obtaining consent would impose an administrative burden on the RTO/ISO.
59. We find that the revised OATTs--as well as this final rule--put
market participants on notice that their credit-related information may
be shared with another RTO/ISO for the purpose of credit risk
management and mitigation. We reject EPSA and NEPOOL's requests that we
require RTOs/ISOs to provide notice to market participants that is
concurrent with the credit-related information sharing or within 30
days thereof, respectively. Market participants experiencing credit
events should expect that credit-related information will be shared
among the RTOs/ISOs that they participate in. Requiring that RTOs/ISOs
provide specific notice to market participants each time credit-related
information is shared will provide little benefit to market
participants while unnecessarily burdening RTO/ISO credit departments
that are responsible for minimizing credit default risk and mitigating
the effects of credit defaults that do occur.
60. We further consider the practical burden of a notice
requirement in the event RTOs/ISOs share certain kinds of credit-
related information. For example, credit-related information in
categories (1) and (2) above may contain the credit-related information
of multiple market participants.\75\ We disagree with NEPOOL that
providing notice will not impose a burden on RTOs/ISOs and find that
such a requirement might create a barrier that dissuades RTOs/ISOs from
sharing this type of credit-related information.
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\75\ See supra P 30 (setting forth categories of credit-related
information).
---------------------------------------------------------------------------
61. We decline to impose a record-keeping requirement on RTOs/ISOs
for any credit-related information sharing, as requested by Indicated
PJM Utilities. As further explained below, an RTO/ISO that receives
credit-related information from another RTO/ISO is required to treat
that information confidential as it would any other credit-related
information. Under the final rule, shared credit-related information
will be safeguarded by the receiving RTO/ISO in accordance with its
OATT. We are not convinced that additional record keeping requirements
are necessary to protect the credit information of market participants.
D. Confidentiality
1. NOPR
62. The Commission proposed to require that an RTO/ISO that
receives credit-related information from another RTO/ISO keep that
information confidential as it would any other credit-related
information received directly from one of its own market
participants.\76\ The Commission preliminarily found that this would
ensure that all credit-related information would continue to be
safeguarded by RTOs/ISOs in accordance with the receiving RTO's/ISO's
OATT.\77\ The Commission sought comment on any additional restrictions
that it should impose on RTOs/ISOs in their management and use of
credit-related information.\78\
---------------------------------------------------------------------------
\76\ NOPR, 180 FERC ] 61,048 P 29.
\77\ Id. P 29.
\78\ Id. P 30.
---------------------------------------------------------------------------
2. Comments
63. IRC and Dominion each supports the NOPR proposal to require
that RTOs/ISOs that receive credit-related information protect its
confidentiality under existing OATT confidentiality protections in the
same manner as they would any other information received directly from
their own market participants.\79\
---------------------------------------------------------------------------
\79\ IRC Initial Comments at 3.
---------------------------------------------------------------------------
64. Several parties argue that existing OATT confidentiality
provisions are not sufficiently uniform to provide consistent
protection to market participants' credit-related information.
Indicated PJM Utilities and EEI each argue that the Commission
therefore should adopt a uniform confidentiality provision applicable
to market participants' credit-related information across the organized
wholesale electric markets.\80\ NEPOOL requests that the Commission
clarify that a market participant may enforce its confidentiality
rights as against the RTO/ISO that receives its credit-related
information even where that market participant is not a signatory to
the receiving RTO's/ISO's OATT.\81\
---------------------------------------------------------------------------
\80\ Indicated PJM Utilities Comments at 13; EEI Comments at 4.
\81\ NEPOOL Comments at 7-8.
---------------------------------------------------------------------------
65. Indicated PJM Utilities provides sample confidentiality
provisions and argues that differences among these provisions and among
the kinds of credit-related information collected by different RTOs/
ISOs increase the risk of unintended disclosure, particularly given the
involvement in credit reviews by third party contractors retained by
CAISO, PJM, and SPP.\82\ Indicated PJM Utilities further argues that
there is a risk of disclosure of confidential information to a market
participant's competitor in ISO-NE, where the RTO/ISO may in some
circumstances provide credit-related information to ISO-NE's
Participants Committee, which is comprised of other market
participants.\83\
---------------------------------------------------------------------------
\82\ Indicated PJM Utilities Comments at 5-13.
\83\ Id. at 13.
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66. Finally, EPSA requests that the Commission confirm that credit-
related information shared by an RTO/ISO with another RTO/ISO will not
be subject to
[[Page 40704]]
disclosure under the Freedom of Information Act (FOIA).\84\
---------------------------------------------------------------------------
\84\ EPSA Comments at 7.
---------------------------------------------------------------------------
3. Commission Determination
67. We adopt the regulations proposed in the NOPR to require that
an RTO/ISO that receives credit-related information from another RTO/
ISO treat that information as it would any other credit-related
information received directly from one of its own market participants.
We find that this requirement will ensure that all credit-related
information shared under this final rule will be safeguarded by the
receiving RTO/ISO in accordance with its OATT.
68. We acknowledge that allowing RTOs/ISOs to share market
participants' credit-related information among themselves may pose some
incremental risk that such information will be disclosed outside of the
RTOs/ISOs. We note, however, that the RTOs/ISOs already are stewards of
large amounts of credit-related information, and they protect that
information in accordance with confidentiality policies included in
their OATTs.\85\ Further, we find that this incremental risk of
disclosure is outweighed by the transparency and credit risk management
benefits that credit-related information sharing will provide.
---------------------------------------------------------------------------
\85\ See, e.g., ISO-NE, Transmission, Markets, and Services
Tariff, attach. D (ISO-NE Information Policy) (22.0.0), section 2.0
(requiring ISO-NE entities to use Confidential Information ``solely
to perform their obligations under the NEPOOL Agreement and the
Participants Agreement'').
---------------------------------------------------------------------------
69. The Commission confronted a similar issue in Order No. 787, in
which it permitted the disclosure of non-public information between
electric transmission operators and interstate natural gas pipelines.
There, the Commission acknowledged that the disclosure of non-public
information poses some incremental risk but noted that these risks are
outweighed by the benefits of additional transparency and information
exchange:
While any exchange of non-public information may pose some
disclosure risks, we find that, on balance, the regulations adopted
here . . . appropriately balance the significant benefits to be
gained by robust information exchange among interdependent
transmission operators against the potential risks from disclosure
of non-public information.\86\
---------------------------------------------------------------------------
\86\ Commc'n of Operational Info. Between Nat. Gas Pipelines &
Elec. Transmission Operators, Order No. 787, 78 FR 70164 (Nov. 22,
2013) 145 FERC ] 61,134, at P 32 (2013), on reh'g, Order No. 787-A,
147 FERC ] 61,228 (2014).
Similarly, this final rule facilitates the RTOs'/ISOs' ability to
accurately assess market participants' credit exposure and strengthen
the tools available to RTOs/ISOs in fulfilling their obligations to
minimize credit default risk and mitigate the effects of credit
defaults that do occur.
70. We acknowledge that there are differences between the kinds of
credit-related information that RTOs/ISOs collect, as EEI and Indicated
PJM Utilities each argues, as well as differences between the kinds of
confidentiality protections afforded market participants under the
different RTO/ISO OATTs. We acknowledge that under this final rule
credit-related information in some circumstances will be protected from
disclosure by the receiving RTO's/ISO's confidentiality protections
rather than the sending RTO/ISO's confidentiality protections. We find
that any such incremental risk is minimal and is outweighed by the
benefit of credit-related information sharing permitted in this final
rule. Therefore, we decline to require RTOs/ISOs to adopt uniform
confidentiality provisions governing the sharing of market
participants' credit-related information.\87\ In addition, the
Commission has already concluded that any such confidentiality
provision in an RTO/ISO OATT is just and reasonable.
---------------------------------------------------------------------------
\87\ Further, we note that RTOs/ISOs cannot evade their
responsibility to safeguard credit-related information by hiring
third party contractors to help conduct credit reviews.
---------------------------------------------------------------------------
71. In response to NEPOOL's request for clarification, we find that
an RTO/ISO must protect credit-related information received from
another RTO/ISO under this final rule in accordance with
confidentiality protections in the receiving RTO's/ISO's OATT. In
accordance with this requirement, the entity whose information was
shared may turn to dispute resolution mechanisms available under the
receiving RTO's/ISO's OATT or submit a complaint under FPA section 206
notwithstanding the fact that such entity may not be a market
participant under the receiving RTO's/ISO's OATT.
72. Finally, EPSA's request that we clarify that credit-related
information that is shared among RTOs/ISOs would not be subject to
requests under FOIA sent to the receiving RTO/ISO is misplaced. FOIA
governs information held by federal agencies, and the Commission will
not have custody or control of credit-related information that is
shared. Credit-related information in the custody or control of RTOs/
ISOs would not be subject to FOIA. We expect each RTO/ISO to respond to
other types of information requests in accordance with its OATT, and
that shared credit-related information will be treated just as would
any other credit-related information held by the RTO/ISO. We decline to
create a different standard for handling credit-related information
received from another RTO/ISO differently than how the receiving RTO/
ISO would treat credit-related information received from its own market
participants.
E. Prescriptive Approach
1. NOPR
73. The Commission acknowledged that there could be benefits to
adopting requirements that RTOs/ISOs share credit-related information
with other RTOs/ISOs, such as establishing a baseline sharing of
credit-related information prior to a credit event that could reduce
the financial losses to non-defaulting market participants during that
event.\88\ The Commission also acknowledged that a prescriptive
approach could impose burdens on RTOs/ISOs, such as raising costs or
straining RTO/ISO resources.\89\ The Commission therefore sought
comment on whether it should modify the NOPR proposal to require that
RTOs/ISOs share credit-related information on a routine basis, in
certain circumstances, or upon request by another RTO/ISO.\90\
---------------------------------------------------------------------------
\88\ NOPR, 180 FERC ] 61,048 P 33.
\89\ Id.
\90\ Id.
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2. Comments
74. SPP MMU argues that the Commission should require an RTO/ISO to
provide credit-related information to another RTO/ISO upon the
reasonable request of the receiving RTO/ISO.\91\ Dominion contends
instead that the Commission should require RTOs/ISOs to share certain
credit-related information on a routine basis, or should condition an
RTO's/ISO's ability to receive credit-related information on its
willingness to share such information with other RTOs/ISOs.\92\
---------------------------------------------------------------------------
\91\ SPP MMU Comments at 4.
\92\ Dominion Comments at 6-7.
---------------------------------------------------------------------------
75. IRC disagrees, arguing that RTOs/ISOs should be permitted
rather than required to share credit-related information. IRC contends
that defining the circumstances in which an RTO/ISO would be required
to share credit-related information would burden RTO/ISO credit
departments.\93\ IRC further argues that a prescriptive approach would
introduce the specter of potential rule violations, which would
distract RTO/ISO credit departments from their efforts to identify and
manage credit risks and to protect non-defaulting
[[Page 40705]]
market participants from the consequences of credit defaults.\94\
---------------------------------------------------------------------------
\93\ IRC Initial Comments at 4-5.
\94\ Id.
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3. Commission Determination
76. We decline to adopt a prescriptive approach that would dictate
circumstances in which RTOs/ISOs must share credit-related information
with other RTOs/ISOs. As noted above, discretion regarding credit-
related information sharing ensures that RTOs/ISOs gain additional
visibility into their market participants' financial condition and are
able to administer organized wholesale electric markets more
effectively both as part of ongoing ``business-as-usual'' credit risk
management practices and during market or credit events.
77. By contrast, we find that a prescriptive approach to sharing
credit-related information would unnecessarily constrain the RTOs'/
ISOs' discretion, limiting the effectiveness of this final rule. A
discretionary rather than a prescriptive approach will allow RTOs/ISOs
to determine what information may help another RTO/ISO carry out its
credit risk management responsibilities and to share such information
in a timely manner to limit negative credit events without the fear of
running afoul of their tariffs or market participants when unique
circumstances arise.
78. Although we do not adopt a prescriptive approach, we reiterate
our expectation that RTOs/ISOs will use reasonable efforts to respond
expeditiously to reasonable requests for credit-related information
from other RTOs/ISOs. We believe the record in this proceeding
demonstrates that RTOs/ISOs want to share credit-related information
with one another for the purposes of credit risk management and
mitigation.
F. Non-Jurisdictional Markets
1. NOPR
79. The Commission acknowledged that market participants in
organized wholesale electric markets also transact in electric markets
that are not Commission-jurisdictional, such as ERCOT, AESO, and IESO,
as well as in commodities and derivatives markets subject to the
jurisdiction of other regulators.\95\ The Commission did not propose to
require the adoption of tariff provisions that would allow RTOs/ISOs to
share credit-related information with these other market operators
because of unresolved issues with such a proposal, including how the
Commission could ensure the protection of market participants'
confidential information in the absence of authority to take remedial
action.\96\
---------------------------------------------------------------------------
\95\ NOPR, 180 FERC ] 61,048 P 35.
\96\ Id. P 36.
---------------------------------------------------------------------------
80. The Commission sought comment on possible frameworks that would
account for jurisdictional limitations while still enabling RTOs/ISOs
to share and receive credit-related information with and from other
non-jurisdictional market operators.\97\
---------------------------------------------------------------------------
\97\ Id.
---------------------------------------------------------------------------
2. Comments
81. EPSA and Dominion agree that the Commission should not permit
RTOs/ISOs to share credit-related information with non-jurisdictional
market operators in the absence of an ability to take remedial action
to protect market participants' confidential credit-related
information.\98\
---------------------------------------------------------------------------
\98\ EPSA Comments at 7-8; Dominion Comments at 8-9.
---------------------------------------------------------------------------
82. IRC requests that the Commission require RTOs/ISOs to amend
their OATTs to allow credit-related information sharing not only with
each other but also with market operators ERCOT, AESO, and IESO. IRC
argues that excluding these market operators, which are not Commission-
jurisdictional for these purposes, will limit awareness of credit risks
that could impact RTOs/ISOs, and points to the example of the 2021
winter energy crisis in the ERCOT market.\99\ IRC contends that sharing
credit-related information with these market operators could be
achieved through reciprocity arrangements, including a Memorandum of
Understanding among the RTOs/ISOs, ERCOT, AESO, and IESO that would
address the relevant mechanics and allow any signatory to cease credit-
related information sharing in the event it has concerns with another
signatory's potential or actual disclosure of confidential credit-
related information.\100\ IRC acknowledges that the Commission would
lack direct enforcement authority over ERCOT, AESO, or IESO, but argues
that these market operators would be incented sufficiently to protect
market participants' confidential credit-related information by the
possibility that one or more RTOs/ISOs would unilaterally cease sharing
that information with them.\101\
---------------------------------------------------------------------------
\99\ IRC Initial Comments at 5.
\100\ Id. at 5-6.
\101\ Id. at 6.
---------------------------------------------------------------------------
3. Commission Determination
83. We decline to adopt IRC's request to require RTOs/ISOs to
propose OATT revisions that would also allow RTOs/ISOs to share credit-
related information with ERCOT, AESO, and IESO. We acknowledge IRC's
concerns, and that RTOs/ISOs could benefit from credit-related
information provided by ERCOT, AESO, and IESO. Nevertheless, we must
balance IRC's request and the effectiveness of credit-related
information sharing against the interest of market participants in
protecting confidential credit-related information. ERCOT, AESO, and
IESO are not subject to the Commission's jurisdiction in this area and
we cannot direct them to share, or dictate how to handle, credit-
related information under this final rule. In addition, we are not
convinced by IRC's suggestion that sharing credit-related information
with these non-jurisdictional entities would incent ERCOT, AESO, and
IESO to protect market participants' confidential credit-related
information. Although this general incentive may exist, these entities
do not have confidentiality provisions that the Commission has
determined to be just and reasonable. For these reasons, this final
rule only permits RTOs/ISOs to share credit-related information with
other RTOs/ISOs.
G. Miscellaneous
1. Comments
84. ETI and SPP MMU each request that the Commission consider
consolidating certain RTO/ISO credit functions in a central credit
entity. ETI argues that the Commission should consider requiring such
an entity to monitor credit activity across the RTOs/ISOs, and proposes
that it would be an independent third party entity overseen by the
Commission and governed by the RTOs/ISOs. ETI contends that this entity
would analyze the creditworthiness of any RTO/ISO market participant
and produce a credit report for that RTO/ISO, saving the RTOs/ISOs and
their market participants both resources and time.\102\ SPP MMU points
to the Commission's routine collection of data from RTOs/ISOs under
Order No. 760, and argues that a similar approach here could eliminate
ambiguity it claims arise from the discretion we afford RTOs/ISOs.\103\
---------------------------------------------------------------------------
\102\ ETI Comments at 7-8.
\103\ SPP MMU Comments at 4-5.
---------------------------------------------------------------------------
2. Commission Determination
85. We decline ETI's and SPP MMU's requests for the consolidation
of certain RTO/ISO credit functions in a central credit entity as
outside the scope of this proceeding, which relates to the sharing of
credit-related information among RTOs/ISOs.
[[Page 40706]]
H. Implementation
1. NOPR
86. The Commission proposed that it would require each RTO/ISO to
submit a compliance filing consistent with a final rule in this
proceeding in which the RTO/ISO would propose tariff revisions to
permit credit-related information sharing.\104\ The Commission sought
comment on whether 60 days after the effective date of any final rule
would be sufficient time to develop this new tariff language.
---------------------------------------------------------------------------
\104\ NOPR, 180 FERC ] 61,048 P 31.
---------------------------------------------------------------------------
2. Comments
87. NEPOOL requests that the Commission allow up to 120 days for
RTOs/ISOs to develop revisions to their OATTs if requested by an RTO/
ISO. NEPOOL explains that this additional time would provide an
opportunity for market participants to understand, discuss, and vote on
any changes to ISO-NE financial assurance policies required to
implement a potential final rule.\105\
---------------------------------------------------------------------------
\105\ NEPOOL Comments at 9-10.
---------------------------------------------------------------------------
3. Commission Determination
88. We adopt the NOPR proposal requiring RTOs/ISOs each to submit a
compliance filing consistent with the regulations adopted herein and
consistent with this final rule no later than 60 days after the
effective date hereof.
89. As it pertains to NEPOOL's request, we clarify that RTOs/ISOs
may ask to extend the 60-day deadline, as necessary, to ensure that
RTOs/ISOs and their stakeholders have the time to work together to
review the RTO/ISO OATT and other governing documents and discuss
revisions thereto.
V. Information Collection Statement
90. The Office of Management and Budget's (OMB) regulations require
approval of certain information collection requirements imposed by
agency rules. 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.
91. This final rulemaking will amend the Commission's regulations
pursuant to section 206 of the FPA, to permit RTOs/ISOs to share among
themselves credit-related information about market participants in
organized wholesale electric markets. To accomplish this, the
Commission will require RTOs/ISOs to adopt tariff revisions reflecting
this reform. Such filings would be made under Part 35 of the
Commission's regulations. Furthermore, in relation to this new FERC
collection (FERC 1005), filers will be required to submit a one-time
compliance filing showing that they have updated their tariff
provisions.
92. Title: FERC 1005: Credit-Related Information Sharing in
Organized Wholesale Electric Markets.
93. Action: Collection of information in accordance with RM22-13-
000.
94. OMB Control No.: 1902-[0325].
95. Respondents for this Rulemaking: RTOs/ISOs.
96. Frequency of Information Collection: One-time compliance filing
and ongoing information sharing (the latter information would not be
submitted to the Commission).
97. Necessity of Information: The proposed rule will require that
RTOs/ISOs submit to the Commission a one-time compliance filing
proposing tariff revisions. Additionally, RTOs/ISOs will be permitted
to share credit related information among themselves to improve their
ability to accurately assess market participants' credit exposure and
risks related to their activities across organized wholesale electric
markets.
98. Internal Review: The Commission has reviewed the changes and
has determined that such changes are necessary. These requirements
conform to the Commission's need for efficient information collection,
communication, and management within the energy industry in support of
the Commission's ensuring just and reasonable rates. The Commission has
specific, objective support for the burden estimates associated with
the information collection requirements.
99. The Commission's estimate contains two estimates regarding
burden and cost. One estimate is for the one-time compliance filing
that will be submitted to the Commission by RTOs/ISOs for the purpose
of revising or amending their tariffs to allow credit-related
information sharing, as outlined in this proposal. The second estimate
is of the ongoing costs associated with RTOs/ISOs sharing credit-
related information with each other.\106\
---------------------------------------------------------------------------
\106\ Note: The information sharing between RTOs/ISOs will not
be submitted to the Commission; the estimate reflects the time and
resources required for individual RTOs/ISOs to share information
with one another.
---------------------------------------------------------------------------
100. The Commission estimates burden \107\ and cost \108\ as
follows:
---------------------------------------------------------------------------
\107\ ``Burden'' is the total time, effort, or financial
resources expended by persons to generate, maintain, retain, or
disclose or provide information to or for a Federal agency. For
further explanation of what is included in the estimated burden,
refer to 5 CFR 1320.3.
\108\ Commission staff estimates that the respondents' skill set
(and wages and benefits) for Docket No. RM22-13-000 are comparable
to those of Commission employees. Based on the Commission's Fiscal
Year 2022 average cost of $188,922/year (for wages plus benefits,
for one full-time employee), $91.00/hour is used.
\109\ The Commission's hourly and cost estimates for the one-
time compliance filing assumes that each RTO/ISO would need to
develop and file tariff revisions with the Commission. The one-time
cost associated with the compliance filing will be incurred in the
first year, but we will annualize the burden and cost over three
years to account for OMB's three year approval period. The
annualized burden and cost of the one-time filing is 50 hours (150/3
= 50) and $4,350 (13,050/3 = 4,350).
\110\ The Commission does not know the extent of information
sharing that would occur in this proposed rule but estimates that
information sharing may occur roughly twice per year on average, per
RTO/ISO.
--------------------------------------------------------------------------------------------------------------------------------------------------------
A. B. C. D. E. F. G.
Collection Number of Annual Total Average burden........... Total annual hr........... Cost per
respondents number of number of hrs. & cost per.......... burdens & total........... respondent
responses per responses response................. annual cost............... (column F /
respondent (column B x (column D x............... column B)
column C) column E).................
--------------------------------------------------------------------------------------------------------------------------------------------------------
RTO/ISOs (one-time compliance 6 1 6 25 hrs.; $2,175.......... 150 hrs.; $13,050......... $2,175
filing) \109\.
RTO/ISOs (ongoing information 6 2 12 4 hrs.; $348............. 48 hrs.; $4,176........... 696
sharing) \110\.
----------------------------------------------------------------------------------------------------------------------
Totals....................... .............. .............. .............. ......................... 198 hrs.; $17,226......... ..............
--------------------------------------------------------------------------------------------------------------------------------------------------------
[[Page 40707]]
VI. Environmental Analysis
101. The Commission is required to prepare an Environmental
Assessment or an Environmental Impact Statement for any action that may
have a significant adverse effect on the human environment.\111\ We
conclude that neither an Environmental Assessment nor an Environmental
Impact Statement is required for this final rule under Sec.
380.4(a)(15) of the Commission's regulations, which provides a
categorical exemption for approvals of actions under sections 205 and
206 of the FPA relating to the filing of schedules containing all rates
and charges for the transmission or sale of electric energy subject to
the Commission's jurisdiction, plus the classification, practices,
contracts, and regulations that affect rates, charges, classifications,
and services.\112\
---------------------------------------------------------------------------
\111\ Reguls. Implementing the Nat'l Envt'l Pol'y Act, Order No.
486, 52 FR 47897 (Dec. 17, 1987), FERC Stats. & Regs. Preambles
1986-1990 ] 30,783 (1987) (cross-referenced at 41 FERC ] 61,284).
\112\ 18 CFR 380.4(a)(15).
---------------------------------------------------------------------------
VII. Regulatory Flexibility Act
102. The Regulatory Flexibility Act of 1980 (RFA) \113\ generally
requires a description and analysis of final rules that will have
significant economic impact on a substantial number of small entities.
The Small Business Administration (SBA) sets the threshold for what
constitutes a small business. Under SBA's size standards,\114\ RTOs/
ISOs fall under the category of Electric Bulk Power Transmission and
Control (NAICS code 221121) with a size threshold of 950 employees
(including the entity and its associates).\115\
---------------------------------------------------------------------------
\113\ 5 U.S.C. 601-612.
\114\ 13 CFR 121.201.
\115\ The RFA definition of ``small entity'' refers to the
definition provided in the Small Business Act, which defines a
``small business concern'' as a business that is independently owned
and operated and that is not dominant in its field of operation. The
SBA's regulations at 13 CFR 121.201 define the threshold for a small
Electric Bulk Power Transmission and Control entity (NAICS code
221121) to be 500 employees. See 5 U.S.C. 601(3) (citing section 3
of the Small Business Act, 15 U.S.C. 632).
---------------------------------------------------------------------------
103. The RTOs/ISOs (i.e., SPP, MISO, PJM, ISO-NE, NYISO, and CAISO)
each employ more than 950 employees and are not considered small.
104. According to SBA guidance, the determination of significance
of impact ``should be seen as relative to the size of the business, the
size of the competitor's business, and the impact the regulation has on
larger competitors.'' \116\ The Commission does not consider the
estimated cost to be a significant economic impact, nor does it effect
a significant amount of small entities. As a result, we certify that
the reforms in this final rule would not have a significant economic
impact on a substantial number of small entities.
---------------------------------------------------------------------------
\116\ U.S. Small Business Administration, ``A Guide for
Government Agencies How to Comply with the Regulatory Flexibility
Act,'' at 18 (May 2012), <a href="https://www.sba.gov/sites/default/files/advocacy/rfaguide_0512_0.pdf">https://www.sba.gov/sites/default/files/advocacy/rfaguide_0512_0.pdf</a>.
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VIII. Document Availability
105. In addition to publishing the full text of this document in
the Federal Register, the Commission provides all interested persons an
opportunity to view and/or print the contents of this document via the
internet through the Commission's Home Page (<a href="http://www.ferc.gov">http://www.ferc.gov</a>). At
this time, the Commission has suspended access to the Commission's
Public Reference Room due to the President's March 13, 2020
proclamation declaring a National Emergency concerning the Novel
Coronavirus Disease (COVID-19).
106. From the Commission's Home Page on the internet, this
information is available on eLibrary. The full text of this document is
available on eLibrary in PDF and Microsoft Word format for viewing,
printing, and/or downloading. To access this document in eLibrary, type
the docket number excluding the last three digits of this document in
the docket number field.
107. User assistance is available for eLibrary and the Commission's
website during normal business hours from FERC Online Support at 202-
502-6652 (toll free at 1-866-208-3676) or email at
<a href="/cdn-cgi/l/email-protection#80e6e5f2e3efeeece9eee5f3f5f0f0eff2f4c0e6e5f2e3aee7eff6"><span class="__cf_email__" data-cfemail="9bfdfee9f8f4f5f7f2f5fee8eeebebf4e9efdbfdfee9f8b5fcf4ed">[email protected]</span></a>, or the Public Reference Room at (202) 502-
8371, TTY (202) 502-8659. Email the Public Reference Room at
<a href="/cdn-cgi/l/email-protection#bacacfd8d6d3d994c8dfdcdfc8dfd4d9dfc8d5d5d7fadcdfc8d994ddd5cc"><span class="__cf_email__" data-cfemail="8bfbfee9e7e2e8a5f9eeedeef9eee5e8eef9e4e4e6cbedeef9e8a5ece4fd">[email protected]</span></a>.
IX. Effective Date and Congressional Notification
108. These regulations are effective August 21, 2023. 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 Fairness Act of 1996.
List of Subjects in 18 CFR Part 35
Electric power rates, Electric utilities, Reporting and
recordkeeping requirements By the Commission.
Issued: June 15, 2023.
Debbie-Anne A. Reese,
Deputy Secretary.
In consideration of the foregoing, the Commission amends part 35,
subpart J, title 18, Code of Federal Regulations, as follows:
PART 35--FILING OF RATE SCHEDULES AND TARIFFS
0
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.
0
2. Amend Sec. 35.47 by adding paragraph (h) to read as follows:
Sec. 35.47 Tariff provisions regarding credit practices in organized
wholesale electric markets.
* * * * *
(h)(1) Subject to paragraph (h)(2) of this section:
(i) Permit organized wholesale electric markets to share market
participant credit-related information with, and receive market
participant credit-related information from, other organized wholesale
electric markets for the purpose of credit risk management and
mitigation; and
(ii) Permit the receiving organized wholesale electric market to
use credit-related information received from another organized
wholesale electric market to the same extent and for the same purposes
that the receiving organized wholesale electric market may use credit-
related information collected from its own market participants.
(2) Require the receiving organized wholesale electric market to
treat credit-related information an organized wholesale electric market
receives from another organized wholesale electric market as
confidential under the terms set forth in the tariff or other governing
document of the receiving organized wholesale electric market.
[FR Doc. 2023-13287 Filed 6-21-23; 8:45 am]
BILLING CODE 6717-01-P
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This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.