FERC Issues Order on Revised FTR Forfeiture Rule

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The Federal Energy Regulatory Commission (FERC) issued an order Jan. 31 accepting PJM’s July 2021 FTR Forfeiture Rule compliance filing. In the order, FERC set the effective date of the revised FTR Forfeiture Rule for Feb. 1, 2022.

The newly revised rule stems from a January 2017 order in which FERC found that PJM’s previous FTR Forfeiture Rule was unjust and unreasonable. FERC ordered PJM to modify it under Section 206 of the Federal Power Act.

Subsequently, PJM submitted a revised rule and implemented it, pursuant to FERC’s ordering paragraph that stated: “PJM must implement, to be effective as of the date of this order, the modifications discussed in the body of this order.” PJM submitted its revised rule as a compliance filing in April 2017, and told FERC that it intended to implement its revised FTR Forfeiture Rule effective on the date of the January 2017 order, per the Commission’s instruction.

In May 2021, FERC notified PJM that, notwithstanding the Commission’s instruction in the January 2017 order, the version of the FTR Forfeiture Rule that PJM had been implementing since 2017 was incorrect, because the Commission had not yet acted on the compliance filing PJM submitted in April 2017.

FERC’s May 2021 order directed PJM to propose a revised version of the FTR Forfeiture Rule and also directed PJM to submit information to assist the Commission in determining whether or not it should order retroactive refunds and surcharges.

PJM submitted its updated FTR Forfeiture Rule compliance filing on July 19, 2021. FERC accepted PJM’s revised rule with its Jan. 31 order, and in doing so, the Commission declined to require retroactive refunds and surcharges.