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ARTICLE · 10 OCTOBER 2017

DOE Directs FERC To Issue Rule To Set Cost-Based Rates For Baseload Plants

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On September 28, 2017, the DOE issued a NOPR proposing that FERC exercise its authority under sections 205 and 206 of the FPA to direct regional grid operators to revise their wholesale...

United StatesEnergy and Natural Resources
Mark Haskell
Mark Haskell
Brett Snyder
Brett Snyder
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On September 28, 2017, the Department of Energy ("DOE") issued a Notice of Proposed Rulemaking ("NOPR") proposing that Federal Energy Regulatory Commission ("FERC") exercise its authority under sections 205 and 206 of the Federal Power Act ("FPA") to direct regional grid operators to revise their wholesale electricity market rules to pay nuclear and coal-fired power plants for contributing to grid reliability.

Secretary of Energy Rick Perry proposed the rule for final action by FERC under section 403 of the Department of Energy Organization Act.  The rule would add a new paragraph to section 35 of FERC's regulations1 allowing full recovery of costs for certain eligible units.  Eligibility is determined by, inter alia, the ability to provide energy and ancillary reliability services and the maintenance of a 90-day fuel supply on site.  Eligible units must be located within the market areas of FERC-approved regional transmission organizations ("RTOs") or independent

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