DC Cir. Vacates FERC Approval of Ending Reactive Power Payments

The Federal Energy Regulatory Commission acted arbitrarily when it approved a proposal from Midcontinent Independent System Operator Inc. to immediately eliminate payments to electric generators for reactive power which helps to ensure energy grid reliability, the DC Circuit ruled Friday.

The commission failed to adequately consider the generators’ short-term reliance interests on the revenue stream, the US Court of Appeals for the DC Circuit said in an opinion granting an industry petition for review.

Although the DC Circuit vacated FERC’s approval of Midcontinent’s amendments, the commission’s separate order ending reactive-power compensation nationwide is still under review in the Fifth Circuit. ...