On March 16, 2023, FERC granted a petition declaring that, should it issue orders pursuant to Sections 210 and 211 of the Federal Power Act (“FPA”), which would be required for a prospective project to interconnect Puerto Rico’s transmission system to the U.S. mainland bulk electric system, such orders would “not render Puerto Rico’s electric utilities ‘public utilities’ under section 201(e) of the FPA. However, FERC reserved the right to make a fact-specific determination at the time any application for such interconnection is sought and further affirmed that, regardless of “public utility” status, FERC would retain jurisdiction over Puerto Rico’s electric utilities pursuant to sections 210, 211, 211A, 212, and 215 of the FPA.
Alternative Transmission, Inc. (“ATI”) is proposing to construct Project Equity, which would involve one or more direct-current undersea transmission cables between Puerto Rico and the U.S. mainland to address reliability problems on Puerto Rico’s electric transmission system. In anticipation of its proposed project, ATI asked FERC to confirm its eligibility to seek orders from the Commission under sections 210 and 211 of the FPA to interconnect and obtain transmission service between the U.S. bulk electric system and Puerto Rico’s transmission system. ATI further asked FERC to confirm that, should the Commission order interconnection and transmission service thereunder, “such orders would not provide a basis for the Commission to exercise plenary jurisdiction over Puerto Rico’s electric transmission system or utilities.”
FERC held that ATI’s Project Equity “has the potential to qualify as an electric utility” and could submit an application for interconnection service under section 210 or could be directed to provide interconnection service under section 211, but reserved its determination based on the specific facts of a future application. Similarly, FERC reserved judgment on whether it would exercise its discretion to issue such orders. The Commission did, however, affirmatively hold that it could exercise its discretion to issue orders under sections 210 and 211 while retaining the status quo whereby Puerto Rico’s electric utilities would not be considered “public utilities” under section 201(e) of the FPA. While this would not grant FERC plenary authority, the Commission would retain jurisdiction over Puerto Rico’s electric utilities pursuant to sections 210, 211, 211A, 212, and 215 of the FPA. FERC noted that should Puerto Rico’s transmission system be interconnected with the U.S. mainland bulk electric system without such orders, the transactions between Puerto Rico and a mainland state would necessarily be considered to be in interstate commerce and thus subject to FERC’s plenary jurisdiction.
A copy of FERC’s order, issued in Docket No. EL23-14, can be found here.
