FERC declines $1.5B refunds stay

The Federal Energy Regulatory Commission has refused to halt roughly $1.5 billion in refunds that New England transmission owners owe electricity customers while the utilities pursue rehearing and court review. The May 13 order keeps in place FERC’s March 19 decision cutting the group’s base return on equity to 9.57% and requiring refunds tied to charges collected over more than a decade. (rtoinsider.com) FERC said a stay is an “extraordinary remedy” and that the companies had not shown the kind of likely irreparable injury needed to justify one. The case sits in a long-running fight over how much profit transmission owners in New England should be allowed to earn on regional grid investments. (utilitydive.com) ### Why did FERC say no to the stay request? FERC said in its May 13 order that parties seeking a stay must show irreparable injury is likely, not just possible. The commission said the New England transmission owners had offered “bare allegations” of likely harm and had mainly described economic losses, which FERC said generally do not meet that standard. The transmission owners had argued that immediate refunds would strain cash flow and force them to carry an unexpected liability on their balance sheets while appeals proceed. FERC said the availability of later corrective relief weighs against a finding of irreparable harm, citing D.C. Circuit precedent summarized in the order. (rtoinsider.com) ### What refunds are at issue in this case? FERC’s March 19 order addressed complaints over the base return on equity, or ROE, earned by New England transmission owners. The commission said the previous 11.14% base ROE was unjust and unreasonable and required the companies to adopt a 9.57% base ROE instead. (finance.yahoo.com) The refund exposure totals about $1.5 billion, according to filings and reporting on the case. Utility Dive reported that Eversource’s New England utilities said they face about $880 million in refunds, while Avangrid’s New England utilities said they face about $203 million. RTO Insider reported that the March order also directed refunds for charges dating from late 2011 through 2012 and applied the lower ROE effective from Oct. 16, 2014, onward. (rtoinsider.com) The underlying litigation began in 2011 and has continued through remand proceedings and multiple complaints. ### Which companies and markets are involved? (ferc.gov) ISO New England runs the region’s wholesale electricity markets and high-voltage transmission system across Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and Vermont. The transmission owners in the case are the utilities that own regional transmission assets and recover those costs through FERC-regulated rates. (utilitydive.com) Eversource’s affected utilities are Connecticut Light and Power, NSTAR Electric and Public Service Co. of New Hampshire, according to the companies’ filings cited in press reports. Avangrid’s affected utilities are Central Maine Power and The United Illuminating Co. (rtoinsider.com) ### Who opposed the stay? New England governors and utility regulators urged FERC in April to reject the stay request and move refunds forward. A filing described by Utility Dive said consumers had borne unjustified costs for more than a decade and that further delay would postpone relief as households face electricity affordability pressures. (ferc.gov) State officials in Massachusetts also welcomed the March order itself. Governor Maura Healey and Attorney General Andrea Joy Campbell said the ruling would produce nearly $1 billion in refunds for New England ratepayers and lower future costs if upheld. (utilitydive.com) ### What happens next? April 20 brought a rehearing request from the New England Transmission Owners, according to FERC’s eLibrary docket. April 2 also brought a joint motion from the transmission owners and ISO New England seeking more time to complete the refunds. FERC has already extended the refund-completion deadline to May 20, 2027, from an earlier 30-day timetable, according to filings summarized in Utility Dive. (utilitydive.com) The utilities also sought a stay from the U.S. Court of Appeals for the District of Columbia Circuit on April 14 while the dispute moves into judicial review. (elibrary.ferc.gov) (mass.gov)