Federal Energy Regulatory Commission Approves Arizona Public Service Company's Market-Based Rate Authority

Strategic Insights -

The Federal Energy Regulatory Commission (FERC) has approved Arizona Public Service Company's (APS) market-based rate authority, allowing the company to participate in the California Independent System Operator Corporation's (CAISO) real-time economic energy dispatch portion of the electricity market. The approval comes after APS submitted a market power analysis demonstrating that the company's generation capacity and market share do not pose a threat to the competitiveness of the CAISO market. The commission has also found that APS satisfies the requirements for market-based rate authority regarding both horizontal and vertical market power.

Key Takeaways:

  • The FERC approved APS's market-based rate authority, allowing the company to participate in the CAISO market.
  • APS submitted a market power analysis demonstrating that the company's generation capacity and market share do not pose a threat to the competitiveness of the CAISO market.
  • The commission found that APS satisfies the requirements for market-based rate authority regarding both horizontal and vertical market power.
  • APS will need to include an EIM price separation analysis in its future triennial updated market power analyses.
  • The commission's approval does not constitute approval of any service, rate, charge, classification, or any rule, regulation, or practice affecting the service provided by APS.

Statistics:

  • 265 megawatts: The net increase in generation capacity in APS's owned and controlled generation portfolio.
  • 6: The number of market power analyses APS submitted for the CAISO market and balancing authority areas.
  • 2: The number of pivotal supplier and wholesale market share screens APS passed in the CAISO market and balancing authority areas.
  • 30 days: The time period within which requests for rehearing by the commission may be filed.

Sources:

  • Federal Energy Regulatory Commission (FERC)
  • Arizona Public Service Company (APS)
  • California Independent System Operator Corporation (CAISO)

Document Accession #: 20210303-3007

Filed Date: 03/03/2021

Docket No. ER10-2437-015