16 U.S.C. § 824r — Protection of transmission contracts in

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.) Page 1435 TITLE 16—CONSERVATION § 824s–1 § 824s. Transmission infrastructure investment (a) Rulemaking requirement Not later than 1 year after August 8, 2005, the Commission shall establish, by rule, incentive- based (including performance-based) rate treat- ments for the transmission of electric energy in interstate commerce by public utilities for the purpose of benefitting consumers by ensuring re- liability and reducing the cost of delivered power by reducing transmission congestion. (b) Contents The rule shall— (1) promote reliable and economically effi- cient transmission and generation of elec- tricity by promoting capital investment in the enlargement, improvement, maintenance, and operation of all facilities for the transmission of electric energy in interstate commerce, re- gardless of the ownership of the facilities; (2) provide a return on equity that attracts new investment in transmission facilities (in- cluding related transmission technologies); (3) encourage deployment of transmission technologies and other measures to increase the capacity and efficiency of existing trans- mission facilities and improve the operation of the facilities; and (4) allow recovery of— (A) all prudently incurred costs necessary to comply with mandatory reliability stand- ards issued pursuant to section 824o of this title; and (B) all prudently incurred costs related to transmission infrastructure development pursuant to section 824p of this title. (c) Incentives In the rule issued under this section, the Com- mission shall, to the extent within its jurisdic- tion, provide for incentives to each transmitting utility or electric utility that joins a Trans- mission Organization. The Commission shall en- sure that any costs recoverable pursuant to this subsection may be recovered by such utility through the transmission rates charged by such utility or through the transmission rates charged by the Transmission Organization that provides transmission service to such utility. (d) Just and reasonable rates All rates approved under the rules adopted pursuant to this section, including any revisions to the rules, are subject to the requirements of sections 824d and 824e of this title that all rates, charges, terms, and conditions be just and rea- sonable and not unduly discriminatory or pref- erential. (June 10, 1920, ch. 285, pt. II, § 219, as added Pub. L. 109–58, title XII, § 1241, Aug. 8, 2005, 119 Stat. 961.) § 824s–1. Incentives for cybersecurity invest- ments (a) Definitions In this section: (1) Advanced cybersecurity technology The term ‘‘advanced cybersecurity tech- nology’’ means any technology, operational capability, or service, including computer hardware, software, or a related asset, that en- hances the security posture of public utilities through improvements in the ability to pro- tect against, detect, respond to, or recover from a cybersecurity threat (as defined in sec- tion 650 of title 6). (2) Advanced cybersecurity technology infor- mation The term ‘‘advanced cybersecurity tech- nology information’’ means information relat- ing to advanced cybersecurity technology or proposed advanced cybersecurity technology that is generated by or provided to the Com- mission or another Federal agency. (b) Study Not later than 180 days after November 15, 2021, the Commission, in consultation with the Secretary of Energy, the North American Elec- tric Reliability Corporation, the Electricity Subsector Coordinating Council, and the Na- tional Association of Regulatory Utility Com- missioners, shall conduct a study to identify in- centive-based, including performance-based, rate treatments for the transmission and sale of electric energy subject to the jurisdiction of the Commission that could be used to encourage— (1) investment by public utilities in ad- vanced cybersecurity technology; and (2) participation by public utilities in cybersecurity threat information sharing pro- grams. (c) Incentive-based rate treatment Not later than 1 year after the completion of the study under subsection (b), the Commission shall establish, by rule, incentive-based, includ- ing performance-based, rate treatments for the transmission of electric energy in interstate commerce and the sale of electric energy at wholesale in interstate commerce by public util- ities for the purpose of benefitting consumers by encouraging— (1) investments by public utilities in ad- vanced cybersecurity technology; and (2) participation by public utilities in cybersecurity threat information sharing pro- grams. (d) Factors for consideration In issuing a rule pursuant to this section, the Commission may provide additional incentives beyond those identified in subsection (c) in any case in which the Commission determines that an investment in advanced cybersecurity tech- nology or information sharing program costs will reduce cybersecurity risks to— (1) defense critical electric infrastructure (as defined in section 824o–1(a) of this title) and other facilities subject to the jurisdiction of the Commission that are critical to public safety, national defense, or homeland security, as determined by the Commission in consulta- tion with— (A) the Secretary of Energy; (B) the Secretary of Homeland Security; and (C) other appropriate Federal agencies; and (2) facilities of small or medium-sized public utilities with limited cybersecurity resources, as determined by the Commission.