16 U.S.C. § 824q — Native load service obligation

Page 1433 TITLE 16—CONSERVATION § 824q AMENDMENTS 2021—Subsec. (a)(1). Pub. L. 117–58, § 40105(a)(1), in- serted ‘‘and Indian Tribes’’ after ‘‘affected States’’ and ‘‘capacity constraints and’’ before ‘‘congestion’’. Subsec. (a)(2). Pub. L. 117–58, § 40105(a)(2), substituted ‘‘Not less frequently than once every 3 years, the Sec- retary, after’’ for ‘‘After’’ and ‘‘affected States and In- dian Tribes), shall issue a report, based on the study under paragraph (1) or other information relating to electric transmission capacity constraints and conges- tion, which may designate as a national interest elec- tric transmission corridor any geographic area that—’’ for ‘‘affected States), the Secretary shall issue a report, based on the study, which may designate any geo- graphic area experiencing electric energy transmission capacity constraints or congestion that adversely af- fects consumers as a national interest electric trans- mission corridor.’’ and added subpars. (i) and (ii). Subsec. (a)(3). Pub. L. 117–58, § 40105(a)(3), substituted ‘‘Not less frequently than once every 3 years, the Sec- retary, in conducting the study under paragraph (1) and issuing the report under paragraph (2), shall consult’’ for ‘‘The Secretary shall conduct the study and issue the report in consultation’’. Subsec. (a)(4)(C). Pub. L. 117–58, § 40105(a)(4)(A), in- serted ‘‘or energy security’’ after ‘‘independence’’. Subsec. (a)(4)(F) to (H). Pub. L. 117–58, § 40105(a)(4)(B)–(D), added subpars. (F) to (H). Subsec. (b)(1)(A)(ii). Pub. L. 117–58, § 40105(b)(1)(A), in- serted ‘‘or interregional benefits’’ after ‘‘interstate benefits’’. Subsec. (b)(1)(C). Pub. L. 117–58, § 40105(b)(1)(B), added subpar. (C) and struck out former subpar. (C) which re- lated to State commission or other authority with- holding approval of construction or giving conditional approval that will not result in significant reduction of transmission congestion in interstate commerce or is not economically feasible. Subsec. (e)(1). Pub. L. 117–58, § 40105(c), substituted ‘‘modify, and operate and maintain, the transmission facilities and, in the determination of the Commission, the permit holder has made good faith efforts to engage with landowners and other stakeholders early in the applicable permitting process, the’’ for ‘‘modify the transmission facilities, the’’. Subsec. (i)(2). Pub. L. 117–58, § 40105(d)(1), substituted ‘‘shall provide’’ for ‘‘may provide’’. Subsec. (i)(4). Pub. L. 117–58, § 40105(d)(2), substituted ‘‘the Secretary determines that the members of the compact are in disagreement after the later of—’’ and subpars. (A) and (B) for ‘‘the members of the compact are in disagreement and the Secretary makes, after no- tice and an opportunity for a hearing, the finding de- scribed in subsection (b)(1)(C).’’ Statutory Notes and Related Subsidiaries WAGE RATE REQUIREMENTS For provisions relating to rates of wages to be paid to laborers and mechanics on projects for construction, alteration, or repair work funded under div. D or an amendment by div. D of Pub. L. 117–58, including au- thority of Secretary of Labor, see section 18851 of Title 42, The Public Health and Welfare. § 824q. Native load service obligation (a) Definitions In this section: (1) The term ‘‘distribution utility’’ means an electric utility that has a service obligation to end-users or to a State utility or electric coop- erative that, directly or indirectly, through one or more additional State utilities or elec- tric cooperatives, provides electric service to end-users. (2) The term ‘‘load-serving entity’’ means a distribution utility or an electric utility that has a service obligation. (3) The term ‘‘service obligation’’ means a requirement applicable to, or the exercise of authority granted to, an electric utility under Federal, State, or local law or under long-term contracts to provide electric service to end- users or to a distribution utility. (4) The term ‘‘State utility’’ means a State or any political subdivision of a State, or any agency, authority, or instrumentality of any one or more of the foregoing, or a corporation that is wholly owned, directly or indirectly, by any one or more of the foregoing, competent to carry on the business of developing, trans- mitting, utilizing, or distributing power. (b) Meeting service obligations (1) Paragraph (2) applies to any load-serving entity that, as of August 8, 2005— (A) owns generation facilities, markets the output of Federal generation facilities, or holds rights under one or more wholesale con- tracts to purchase electric energy, for the pur- pose of meeting a service obligation; and (B) by reason of ownership of transmission facilities, or one or more contracts or service agreements for firm transmission service, holds firm transmission rights for delivery of the output of the generation facilities or the purchased energy to meet the service obliga- tion. (2) Any load-serving entity described in para- graph (1) is entitled to use the firm transmission rights, or, equivalent tradable or financial transmission rights, in order to deliver the out- put or purchased energy, or the output of other generating facilities or purchased energy to the extent deliverable using the rights, to the ex- tent required to meet the service obligation of the load-serving entity. (3)(A) To the extent that all or a portion of the service obligation covered by the firm trans- mission rights or equivalent tradable or finan- cial transmission rights is transferred to an- other load-serving entity, the successor load- serving entity shall be entitled to use the firm transmission rights or equivalent tradable or fi- nancial transmission rights associated with the transferred service obligation. (B) Subsequent transfers to another load-serv- ing entity, or back to the original load-serving entity, shall be entitled to the same rights. (4) The Commission shall exercise the author- ity of the Commission under this chapter in a manner that facilitates the planning and expan- sion of transmission facilities to meet the rea- sonable needs of load-serving entities to satisfy the service obligations of the load-serving enti- ties, and enables load-serving entities to secure firm transmission rights (or equivalent tradable or financial rights) on a long-term basis for long-term power supply arrangements made, or planned, to meet such needs. (c) Allocation of transmission rights Nothing in subsections (b)(1), (b)(2), and (b)(3) of this section shall affect any existing or future methodology employed by a Transmission Orga- nization for allocating or auctioning trans- mission rights if such Transmission Organiza- tion was authorized by the Commission to allo- cate or auction financial transmission rights on Page 1434 TITLE 16—CONSERVATION § 824r 1 So in original. Probably should be ‘‘this’’. its system as of January 1, 2005, and the Com- mission determines that any future allocation or auction is just, reasonable and not unduly discriminatory or preferential, provided, how- ever, that if such a Transmission Organization never allocated financial transmission rights on its system that pertained to a period before Jan- uary 1, 2005, with respect to any application by such Transmission Organization that would change its methodology the Commission shall exercise its authority in a manner consistent with the 1 chapter and that takes into account the policies expressed in subsections (b)(1), (b)(2), and (b)(3) as applied to firm transmission rights held by a load-serving entity as of Janu- ary 1, 2005, to the extent the associated genera- tion ownership or power purchase arrangements remain in effect. (d) Certain transmission rights The Commission may exercise authority under this chapter to make transmission rights not used to meet an obligation covered by sub- section (b) available to other entities in a man- ner determined by the Commission to be just, reasonable, and not unduly discriminatory or preferential. (e) Obligation to build Nothing in this chapter relieves a load-serving entity from any obligation under State or local law to build transmission or distribution facili- ties adequate to meet the service obligations of the load-serving entity. (f) Contracts Nothing in this section shall provide a basis for abrogating any contract or service agree- ment for firm transmission service or rights in effect as of August 8, 2005. If an ISO in the West- ern Interconnection had allocated financial transmission rights prior to August 8, 2005, but had not done so with respect to one or more load-serving entities’ firm transmission rights held under contracts to which the preceding sen- tence applies (or held by reason of ownership or future ownership of transmission facilities), such load-serving entities may not be required, without their consent, to convert such firm transmission rights to tradable or financial rights, except where the load-serving entity has voluntarily joined the ISO as a participating transmission owner (or its successor) in accord- ance with the ISO tariff. (g) Water pumping facilities The Commission shall ensure that any entity described in section 824(f) of this title that owns transmission facilities used predominately to support its own water pumping facilities shall have, with respect to the facilities, protections for transmission service comparable to those provided to load-serving entities pursuant to this section. (h) ERCOT This section shall not apply within the area referred to in section 824k(k)(2)(A) of this title. (i) Jurisdiction This section does not authorize the Commis- sion to take any action not otherwise within the jurisdiction of the Commission. (j) TVA area (1) Subject to paragraphs (2) and (3), for pur- poses of subsection (b)(1)(B), a load-serving enti- ty that is located within the service area of the Tennessee Valley Authority and that has a firm wholesale power supply contract with the Ten- nessee Valley Authority shall be considered to hold firm transmission rights for the trans- mission of the power provided. (2) Nothing in this subsection affects the re- quirements of section 824k(j) of this title. (3) The Commission shall not issue an order on the basis of this subsection that is contrary to the purposes of section 824k(j) of this title. (k) Effect of exercising rights An entity that to the extent required to meet its service obligations exercises rights described in subsection (b) shall not be considered by such action as engaging in undue discrimination or preference under this chapter. (June 10, 1920, ch. 285, pt. II, § 217, as added Pub. L. 109–58, title XII, § 1233(a), Aug. 8, 2005, 119 Stat. 957.) Statutory Notes and Related Subsidiaries FERC RULEMAKING ON LONG-TERM TRANSMISSION RIGHTS IN ORGANIZED MARKETS Pub. L. 109–58, title XII, § 1233(b), Aug. 8, 2005, 119 Stat. 960, provided that: ‘‘Within 1 year after the date of enactment of this section [Aug. 8, 2005] and after no- tice and an opportunity for comment, the [Federal En- ergy Regulatory] Commission shall by rule or order, implement section 217(b)(4) of the Federal Power Act [16 U.S.C. 824q(b)(4)] in Transmission Organizations, as defined by that Act [16 U.S.C. 791a et seq.] with orga- nized electricity markets.’’ § 824r. Protection of transmission contracts in the Pacific Northwest (a) Definition of electric utility or person In this section, the term ‘‘electric utility or person’’ means an electric utility or person that— (1) as of August 8, 2005, holds firm trans- mission rights pursuant to contract or by rea- son of ownership of transmission facilities; and (2) is located— (A) in the Pacific Northwest, as that re- gion is defined in section 839a of this title; or (B) in that portion of a State included in the geographic area proposed for a regional transmission organization in Commission Docket Number RT01–35 on the date on which that docket was opened. (b) Protection of transmission contracts Nothing in this chapter confers on the Com- mission the authority to require an electric util- ity or person to convert to tradable or financial rights— (1) firm transmission rights described in sub- section (a); or (2) firm transmission rights obtained by ex- ercising contract or tariff rights associated with the firm transmission rights described in subsection (a). (June 10, 1920, ch. 285, pt. II, § 218, as added Pub. L. 109–58, title XII, § 1235, Aug. 8, 2005, 119 Stat. 960.)