FERC Issues Final Gas-Electric Coordination Rule
The Federal Energy Regulatory Commission (FERC) has approved a final rule to improve coordination of wholesale natural gas and electricity market scheduling in light of the nation’s increased reliance on natural gas generation.
FERC’s March 2014 Notice of Proposed Rulemaking for Order No. 809 proposed changes to nationwide gas scheduling practices, but it gave the power and natural gas sectors six months to use a North American Energy Standards Board (NAESB) process to reach consensus on the proposal.
The April 16–approved Order No. 809 essentially revises FERC’s rules to incorporate the modified NAESB business practice standards developed through that process. It also adopts a proposal submitted by the NAESB to revise the interstate natural gas nomination timeline.
Revisions in the final rule include moving the Timely Nomination Cycle deadline for scheduling gas transportation from 11:30 a.m. Central Clock Time (CCT) to 1 p.m. CCT, and they add a third intraday nomination cycle during the gas operating day to help shippers adjust their scheduling to reflect changes in demand.
The final rule takes effect 75 days after publication in the Federal Register. Ninety days after publication, each ISO and RTO is also required to proposes “tariff revisions to coordinate its day-ahead market with the natural gas pipeline scheduling changes adopted in the Final Rule, or to show cause why its existing scheduling practices need not be changed.”
The rule’s finalization culminates three years of collaborative efforts, said FERC Commissioner Cheryl LaFleur on April 16.
LaFleur also said that beyond national issues such as scheduling, regional efforts should continue to address aspects of gas and electric coordination, “particularly fuel assurance in competitive electric markets that are heavily or increasingly dependent on natural gas.”
In particular, ISO-NE and PJM have undertaken market reforms to promote fuel assurance in their respective footprints, some of which are still pending before the commission, and efforts are underway in New England to assess and address regional needs for natural gas infrastructure, LaFleur noted.
—Sonal Patel, associate editor (@POWERmagazine, @sonalcpatel)