§ 824k. — Orders requiring interconnection or wheeling.
[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 16USC824k]
TITLE 16--CONSERVATION
CHAPTER 12--FEDERAL REGULATION AND DEVELOPMENT OF POWER
SUBCHAPTER II--REGULATION OF ELECTRIC UTILITY COMPANIES ENGAGED IN
INTERSTATE COMMERCE
Sec. 824k. Orders requiring interconnection or wheeling
(a) Rates, charges, terms, and conditions for wholesale transmission
services
An order under section 824j of this title shall require the
transmitting utility subject to the order to provide wholesale
transmission services at rates, charges, terms, and conditions which
permit the recovery by such utility of all the costs incurred in
connection with the transmission services and necessary associated
services, including, but not limited to, an appropriate share, if any,
of legitimate, verifiable and economic costs, including taking into
account any benefits to the transmission system of providing the
transmission service, and the costs of any enlargement of transmission
facilities. Such rates, charges, terms, and conditions shall promote the
economically efficient transmission and generation of electricity and
shall be just and reasonable, and not unduly discriminatory or
preferential. Rates, charges, terms, and conditions for transmission
services provided pursuant to an order under section 824j of this title
shall ensure that, to the extent practicable, costs incurred in
providing the wholesale transmission services, and properly allocable to
the provision of such services, are recovered from the applicant for
such order and not from a transmitting utility's existing wholesale,
retail, and transmission customers.
(b) Repealed. Pub. L. 102-486, title VII, Sec. 722(1), Oct. 24, 1992,
106 Stat. 2916
(c) Issuance of proposed order; agreement by parties to terms and
conditions of order; approval by Commission; inclusion in final
order; failure to agree
(1) Before issuing an order under section 824i of this title or
subsection (a) or (b) of section 824j of this title, the Commission
shall issue a proposed order and set a reasonable time for parties to
the proposed interconnection or transmission order to agree to terms and
conditions under which such order is to be carried out, including the
apportionment of costs between them and the compensation or
reimbursement reasonably due to any of them. Such proposed order shall
not be reviewable or enforceable in any court. The time set for such
parties to agree to such terms and conditions may be shortened if the
Commission determines that delay would jeopardize the attainment of the
purposes of any proposed order. Any terms and conditions agreed to by
the parties shall be subject to the approval of the Commission.
(2)(A) If the parties agree as provided in paragraph (1) within the
time set by the Commission and the Commission approves such agreement,
the terms and conditions shall be included in the final order. In the
case of an order under section 824i of this title, if the parties fail
to agree within the time set by the Commission or if the Commission does
not approve any such agreement, the Commission shall prescribe such
terms and conditions and include such terms and conditions in the final
order.
(B) In the case of any order applied for under section 824j of this
title, if the parties fail to agree within the time set by the
Commission, the Commission shall prescribe such terms and conditions in
the final order.
(d) Statement of reasons for denial
If the Commission does not issue any order applied for under section
824i or 824j of this title, the Commission shall, by order, deny such
application and state the reasons for such denial.
(e) Savings provisions
(1) No provision of section 824i, 824j, 824m of this title, or this
section shall be treated as requiring any person to utilize the
authority of any such section in lieu of any other authority of law.
Except as provided in section 824i, 824j, 824m of this title, or this
section, such sections shall not be construed as limiting or impairing
any authority of the Commission under any other provision of law.
(2) Sections 824i, 824j, 824l, 824m of this title, and this section,
shall not be construed to modify, impair, or supersede the antitrust
laws. For purposes of this section, the term ``antitrust laws'' has the
meaning given in subsection (a) of the first sentence of section 12 of
title 15, except that such term includes section 45 of title 15 to the
extent that such section relates to unfair methods of competition.
(f) Effective date of order; hearing; notice; review
(1) No order under section 824i or 824j of this title requiring the
Tennessee Valley Authority (hereinafter in this subsection referred to
as the ``TVA'') to take any action shall take effect for 60 days
following the date of issuance of the order. Within 60 days following
the issuance by the Commission of any order under section 824i or of
section 824j of this title requiring the TVA to enter into any contract
for the sale or delivery of power, the Commission may on its own motion
initiate, or upon petition of any aggrieved person shall initiate, an
evidentiary hearing to determine whether or not such sale or delivery
would result in violation of the third sentence of section 15d(a) of the
Tennessee Valley Authority Act of 1933 (16 U.S.C. 831n-4), hereinafter
in this subsection referred to as the TVA Act [16 U.S.C. 831 et seq.].
(2) Upon initiation of any evidentiary hearing under paragraph (1),
the Commission shall give notice thereof to any applicant who applied
for and obtained the order from the Commission, to any electric utility
or other entity subject to such order, and to the public, and shall
promptly make the determination referred to in paragraph (1). Upon
initiation of such hearing, the Commission shall stay the effectiveness
of the order under section 824i or 824j of this title until whichever of
the following dates is applicable--
(A) the date on which there is a final determination (including
any judicial review thereof under paragraph (3)) that no such
violation would result from such order, or
(B) the date on which a specific authorization of the Congress
(within the meaning of the third sentence of section 15d(a) of the
TVA Act [16 U.S.C. 831n-4(a)]) takes effect.
(3) Any determination under paragraph (1) shall be reviewable only
in the appropriate court of the United States upon petition filed by any
aggrieved person or municipality within 60 days after such
determination, and such court shall have jurisdiction to grant
appropriate relief. Any applicant who applied for and obtained the order
under section 824i or 824j of this title, and any electric utility or
other entity subject to such order shall have the right to intervene in
any such proceeding in such court. Except for review by such court (and
any appeal or other review by an appellate court of the United States),
no court shall have jurisdiction to consider any action brought by any
person to enjoin the carrying out of any order of the Commission under
section 824i or section 824j of this title requiring the TVA to take any
action on the grounds that such action requires a specific authorization
of the Congress pursuant to the third sentence of section 15d(a) of the
TVA Act [16 U.S.C. 831n-4(a)].
(g) Prohibition on orders inconsistent with retail marketing areas
No order may be issued under this chapter which is inconsistent with
any State law which governs the retail marketing areas of electric
utilities.
(h) Prohibition on mandatory retail wheeling and sham wholesale
transactions
No order issued under this chapter shall be conditioned upon or
require the transmission of electric energy:
(1) directly to an ultimate consumer, or
(2) to, or for the benefit of, an entity if such electric energy
would be sold by such entity directly to an ultimate consumer,
unless:
(A) such entity is a Federal power marketing agency; the
Tennessee Valley Authority; a State or any political subdivision
of a State (or an agency, authority, or instrumentality of a
State or a political subdivision); a corporation or association
that has ever received a loan for the purposes of providing
electric service from the Administrator of the Rural
Electrification Administration under the Rural Electrification
Act of 1936 [7 U.S.C. 901 et seq.]; a person having an
obligation arising under State or local law (exclusive of an
obligation arising solely from a contract entered into by such
person) to provide electric service to the public; or any
corporation or association which is wholly owned, directly or
indirectly, by any one or more of the foregoing; and
(B) such entity was providing electric service to such
ultimate consumer on October 24, 1992, or would utilize
transmission or distribution facilities that it owns or controls
to deliver all such electric energy to such electric consumer.
Nothing in this subsection shall affect any authority of any State or
local government under State law concerning the transmission of electric
energy directly to an ultimate consumer.
(i) Laws applicable to Federal Columbia River Transmission System
(1) The Commission shall have authority pursuant to section 824i of
this title, section 824j of this title, this section, and section 824l
of this title to (A) order the Administrator of the Bonneville Power
Administration to provide transmission service and (B) establish the
terms and conditions of such service. In applying such sections to the
Federal Columbia River Transmission System, the Commission shall assure
that--
(i) the provisions of otherwise applicable Federal laws shall
continue in full force and effect and shall continue to be
applicable to the system; and
(ii) the rates for the transmission of electric power on the
system shall be governed only by such otherwise applicable
provisions of law and not by any provision of section 824i of this
title, section 824j of this title, this section, or section 824l of
this title, except that no rate for the transmission of power on the
system shall be unjust, unreasonable, or unduly discriminatory or
preferential, as determined by the Commission.
(2) Notwithstanding any other provision of this chapter with respect
to the procedures for the determination of terms and conditions for
transmission service--
(A) when the Administrator of the Bonneville Power
Administration either (i) in response to a written request for
specific transmission service terms and conditions does not offer
the requested terms and conditions, or (ii) proposes to establish
terms and conditions of general applicability for transmission
service on the Federal Columbia River Transmission System, then the
Administrator may provide opportunity for a hearing and, in so
doing, shall--
(I) give notice in the Federal Register and state in such
notice the written explanation of the reasons why the specific
terms and conditions for transmission services are not being
offered or are being proposed;
(II) adhere to the procedural requirements of paragraphs (1)
through (3) of section 839e(i) of this title, except that the
hearing officer shall, unless the hearing officer becomes
unavailable to the agency, make a recommended decision to the
Administrator that states the hearing officer's findings and
conclusions, and the reasons or basis thereof, on all material
issues of fact, law, or discretion presented on the record; and
(III) make a determination, setting forth the reasons for
reaching any findings and conclusions which may differ from
those of the hearing officer, based on the hearing record,
consideration of the hearing officer's recommended decision,
section 824j of this title and this section, as amended by the
Energy Policy Act of 1992, and the provisions of law as
preserved in this section; and
(B) if application is made to the Commission under section 824j
of this title for transmission service under terms and conditions
different than those offered by the Administrator, or following the
denial of a request for transmission service by the Administrator,
and such application is filed within 60 days of the Administrator's
final determination and in accordance with Commission procedures,
the Commission shall--
(i) in the event the Administrator has conducted a hearing
as herein provided for (I) accord parties to the Administrator's
hearing the opportunity to offer for the Commission record
materials excluded by the Administrator from the hearing record,
(II) accord such parties the opportunity to submit for the
Commission record comments on appropriate terms and conditions,
(III) afford those parties the opportunity for a hearing if and
to the extent that the Commission finds the Administrator's
hearing record to be inadequate to support a decision by the
Commission, and (IV) establish terms and conditions for or deny
transmission service based on the Administrator's hearing
record, the Commission record, section 824j of this title and
this section, as amended by the Energy Policy Act of 1992, and
the provisions of law as preserved in this section, or
(ii) in the event the Administrator has not conducted a
hearing as herein provided for, determine whether to issue an
order for transmission service in accordance with section 824j
of this title and this section, including providing the
opportunity for a hearing.
(3) Notwithstanding those provisions of section 825l(b) of this
title which designate the court in which review may be obtained, any
party to a proceeding concerning transmission service sought to be
furnished by the Administrator of the Bonneville Power Administration
seeking review of an order issued by the Commission in such proceeding
shall obtain a review of such order in the United States Court of
Appeals for the Pacific Northwest, as that region is defined by section
839a(14) of this title.
(4) To the extent the Administrator of the Bonneville Power
Administration cannot be required under section 824j of this title, as a
result of the Administrator's other statutory mandates, either to (A)
provide transmission service to an applicant which the Commission would
otherwise order, or (B) provide such service under rates, terms, and
conditions which the Commission would otherwise require, the applicant
shall not be required to provide similar transmission services to the
Administrator or to provide such services under similar rates, terms,
and conditions.
(5) The Commission shall not issue any order under section 824i of
this title, section 824j of this title, this section, or section 824l of
this title requiring the Administrator of the Bonneville Power
Administration to provide transmission service if such an order would
impair the Administrator's ability to provide such transmission service
to the Administrator's power and transmission customers in the Pacific
Northwest, as that region is defined in section 839a(14) of this title,
as is needed to assure adequate and reliable service to loads in that
region.
(j) Equitability within territory restricted electric systems
With respect to an electric utility which is prohibited by Federal
law from being a source of power supply, either directly or through a
distributor of its electric energy, outside an area set forth in such
law, no order issued under section 824j of this title may require such
electric utility (or a distributor of such electric utility) to provide
transmission services to another entity if the electric energy to be
transmitted will be consumed within the area set forth in such Federal
law, unless the order is in furtherance of a sale of electric energy to
that electric utility: Provided, however, That the foregoing provision
shall not apply to any area served at retail by an electric transmission
system which was such a distributor on October 24, 1992, and which
before October 1, 1991, gave its notice of termination under its power
supply contract with such electric utility.
(k) ERCOT utilities
(1) Rates
Any order under section 824j of this title requiring provision
of transmission services in whole or in part within ERCOT shall
provide that any ERCOT utility which is not a public utility and the
transmission facilities of which are actually used for such
transmission service is entitled to receive compensation based,
insofar as practicable and consistent with subsection (a) of this
section, on the transmission ratemaking methodology used by the
Public Utility Commission of Texas.
(2) Definitions
For purposes of this subsection--
(A) the term ``ERCOT'' means the Electric Reliability
Council of Texas; and
(B) the term ``ERCOT utility'' means a transmitting utility
which is a member of ERCOT.
(June 10, 1920, ch. 285, pt. II, Sec. 212, as added Pub. L. 95-617,
title II, Sec. 204(a), Nov. 9, 1978, 92 Stat. 3138; amended Pub. L. 102-
486, title VII, Sec. 722, Oct. 24, 1992, 106 Stat. 2916.)
References in Text
The TVA Act, referred to in subsec. (f)(1), means act May 18, 1933,
ch. 32, 48 Stat. 58, as amended, known as the Tennessee Valley Authority
Act of 1933, which is classified generally to chapter 12A (Sec. 831 et
seq.) of this title. For complete classification of this Act to the
Code, see section 831 of this title and Tables.
The Rural Electrification Act of 1936, referred to in subsec.
(h)(2)(A), is act May 20, 1936, ch. 432, 49 Stat. 1363, as amended,
which is classified generally to chapter 31 (Sec. 901 et seq.) of Title
7, Agriculture. For complete classification of this Act to the Code, see
section 901 of Title 7 and Tables.
The Energy Policy Act of 1992, referred to in subsec.
(i)(2)(A)(III), (B)(i), is Pub. L. 102-486, Oct. 24, 1992, 106 Stat.
2776. For complete classification of this Act to the Code, see Short
Title note set out under section 13201 of Title 42, The Public Health
and Welfare and Tables.
Amendments
1992--Subsec. (a). Pub. L. 102-486, Sec. 722(1), added subsec. (a)
and struck out former subsec. (a) which related to determinations by
Commission.
Subsec. (b). Pub. L. 102-486, Sec. 722(1), struck out subsec. (b)
which required applicants for orders to be ready, willing, and able to
reimburse parties subject to such orders.
Subsec. (e). Pub. L. 102-486, Sec. 722(2), amended subsec. (e)
generally. Prior to amendment, subsec. (e) related to utilization of
interconnection or wheeling authority in lieu of other authority and
limitation of Commission authority.
Subsecs. (g) to (k). Pub. L. 102-486, Sec. 722(3), added subsecs.
(g) to (k).
State Authorities; Construction
Nothing in amendment by Pub. L. 102-486 to be construed as affecting
or intending to affect, or in any way to interfere with, authority of
any State or local government relating to environmental protection or
siting of facilities, see section 731 of Pub. L. 102-486, set out as a
note under section 79 of Title 15, Commerce and Trade.
Transfer of Functions
The Federal Power Commission was terminated and its functions,
personnel, property, funds, etc., were transferred to the Secretary of
Energy (except for certain functions which were transferred to the
Federal Energy Regulatory Commission) by sections 7151(b), 7171(a),
7172(a), 7291, and 7293 of Title 42, The Public Health and Welfare.
Section Referred to in Other Sections
This section is referred to in sections 824, 824a-3, 824i, 824j,
825n, 825o, 825o-1 of this title.
