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John Hutchings Compliance Enforcement Analyst

John Hutchings Compliance Enforcement Analyst. Federal Entity Cases and Civil Penalty Authority September 5, 2012 WECC Compliance Committee Meeting. Alleged Violations Placed “on hold” Status Awaiting FERC Decision.

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John Hutchings Compliance Enforcement Analyst

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  1. John HutchingsCompliance Enforcement Analyst Federal Entity Cases and Civil Penalty Authority September 5, 2012 WECC Compliance Committee Meeting

  2. Alleged Violations Placed “on hold” Status Awaiting FERC Decision • Since June 18, 2007, all federal entity case penalty negotiations are being placed “on hold” status after WECC sent its Notice of Alleged Violation (“NOAV”) document to the entity. • Federal entities agreed to mitigate almost all alleged violations.

  3. Federal Entity Cases in WECC’s Region • In the WECC region, there are currently 225 alleged violations with penalty negotiations on “hold” involving federal entities.

  4. July 2012 FERC Action • Order on Review of Notice of Penalty, 140 FERC ¶ 61, 048 (July 19, 2012). • FERC concluded that the language of section 215 of the Federal Power Act: • Constitutes a waiver of sovereign immunity, and • Grants FERC the authority to impose monetary penalties on federal entities for a violation of a mandatory Reliability Standard.

  5. July 2012 FERC Action and WECC’s Response • On July 26, 2012 WECC sent a letter to federal entities with open violations. • The WECC letter notified each entity that WECC would contact it in 30 days to resume settlement discussions.

  6. July 2012 FERC Action and Federal Entity Response • Federal entities and trade associations have filed for re-hearing at FERC arguing that section 215 is not a waiver of sovereign immunity and requesting a stay of proceedings. • Department of the Interior - USBR • Department of Energy – BPA, WAPA, NNSAL, SWPA • Southeastern Federal Power Customers • Mid-West Electric Consumers Association and the Southwestern Power Resources Association

  7. Next Steps • WECC is encouraging federal entities to reach an agreement in principal on penalties subject to the outcome of the FERC proceeding. • Federal entity case penalty negotiations still “on hold” pending the outcome of the FERC proceeding.

  8. Some Possible Outcomes of Rehearing Requests • FERC overrules itself and WECC settles cases with no monetary penalties. • FERC upholds its decision and federal entities appeal in Federal Court. • FERC upholds itself and federal entities settle monetary penalties with WECC.

  9. Current Status of Federal Entity Cases • Federal entity case penalty negotiations are still “on hold” pending the outcome of the FERC re-hearing proceeding. • WECC will continue to encourage federal entities to negotiate an agreement in principal on monetary penalties. • Reliability is being promoted despite re-hearing proceeding because federal entities are mitigating their Possible Violations

  10. John Hutchings Compliance Enforcement Analyst (801) 819 -7681 jhutchings@wecc.biz Questions?

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