On May 20, 20201, NEPGA answered NEPOOL and ISO-NE.  In its Answer, NEPOOL argues that the Commission should reject NEPGA’s assertions of the Joint Filers’ violation of the filed rate doctrine because they are simply “legal arguments” and the Commission is not “constrained by such principles.”[2]  Compliance with the filed rate doctrine and the corollary requirement that rates cannot be retroactively changed are foundational requirements under the Federal Power Act that the Commission cannot ignore.  For the sixteenth forward capacity auction (“FCA 16”), ISO-NE required existing resources to submit Permanent and Retirement De-List Bids (collectively, “Exit Bids”) no later than March 12, 2021 (“Retirement Deadline”).  Suppliers lacked legally required notice as to the changed rate as of the Retirement Deadline. Indeed, they still lack legally required notice as the Jump Ball Filing does not specify which of the competing ORTP proposals will apply in the future.  Neither the ISO-NE stakeholder process nor the IMM memorandum permitting conditional retirement bids afforded reassurance or certainty about Trigger Prices to suppliers contemplating irrevocable Exit Bids.

If the Commission resolves the many difficult issues raised in the Jump Ball Filing and retroactively alters Trigger Prices, instead of simply using the FCA 15 rates that are currently on file, it will cause irreparable harm to suppliers who did not submit Exit Bids on account of reliance on the filed rate.  As explained below, even if those suppliers take all available actions to exit the market to avoid the retroactive Trigger Prices, they will be subject to ongoing costs and risks, and unable to pursue the most cost-efficient unwinding activities for at least a year.

Regarding NEPOOL’s off-shore wind Trigger Price proposal and its criticism of NEPGA’s expert affidavit, this Answer explains that NEPOOL fails to meet its goal of aligning its off-shore wind Trigger Prices with prevailing market conditions.  This is because NEPOOL fails to account for tax consequences consistent with how the renewable industry finances projects for sufficient ability to use the tax benefits in a timely manner.   Moreover, NEPOOL’s Answer, in attempting to support its extended-horizon framework, only adds fuel to the fire.  NEPOOL’s reliance on design criteria to show the useful life of a project is unreasonable and speculative and does not support its extended horizon proposal.

NEPGA renews its request that the Commission reject, without prejudice, the ORTP proposals on the grounds that they would retroactively modify the filed rate, and direct ISO-NE to employ in FCA 16 the Trigger Prices in effect at the time of the Exit Bids—namely, the FCA 15 Trigger Prices.  In the alternative, the Commission should approve ISO-NE’s proposed Trigger Prices for effect in FCA 17.  Under no circumstances, however, should the Commission approve NEPOOL’s unjust and unreasonable ORTPs, for effect in either FCA 16 or FCA 17.