News Digest

 

Power Markets

Striking a blow for power producers, who cited the risk of not being paid, the FERC denied authority to the California ISO to waive its minimum credit requirements to allow PG&E and Southern California Edison to continue to schedule transactions within ISO markets with third-party power producers and marketers.

The FERC ruled that PG&E and Edison must continue to meet ISO credit standards, except in the limited case in which PG&E or Edison would self-provide the transaction and create no risk for third parties-that is, the utilities would be using only their own generating facilities and their own proprietary transmission lines (albeit under ISO control) to execute the scheduled transaction.

The FERC said that if it allowed the ISO to lower credit standards for the two largest buyers in the market, it would foster "an inappropriate unilateral shifting of unacceptable financial risks to both large and small third-party suppliers." .

The FERC acted after noting various retaliatory actions by power producers.