DOJ Business Advisory Letter 99-3 of June 14, 1999 concerning the Western Systems Coordinating Council
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excerpted from DOJ source)
Facts: Western Systems Coordinating Council ("WSCC")--one of ten electric reliability councils in North America--is a voluntary organization responsible for promoting electrical system reliability and coordinating operating and planning activities for its 107 member systems. WSCC believes that, as a result of deregulation, a voluntary system is no longer adequate to protect system reliability and proposes to establish a mandatory reliability system, including sanctions. The reliability criteria would be set forth in a generic tariff that would be placed on file with the Federal Energy Regulatory Commission ("FERC"). Interested parties who object to the reliability criteria would have an opportunity to petition the FERC. Participating members would enter into standardized contracts committing themselves to adhere to the criteria; however, no transmission operator would be required to participate in the mandatory program and there would be no sanctions on those participating on a voluntary basis. Compliance would be monitored by the WSCC using data supplied by Transmission Operators and interconnected generators. Participants who receive an initial determination of noncompliance could appeal to a WSCC Reliability Compliance Committee. If a party disputed the determination of the Reliability Compliance Committee, it could pursue Alternative Dispute Resolution under criteria on file with the FERC, which permit appeals to the FERC (or the courts in the case of nonjurisdictional parties). WSCC filed a petition with the FERC seeking a regulatory determination that its proposal was fair and reasonable. In response, the FERC asserted jurisdiction over the WSCC proposal and approved its implementation on an experimental basis, finding that WSCC's governance procedures seemed to be "fair" and its ADR procedures for dealing with proposed violations and sanctions seemed to be "just and reasonable."
Response: The processes under which the reliability standards are to be established and enforced appear to be open to all interested parties, provide for representation for all segments of the industry, are not designed to competitively disadvantage any particular party or segment of the industry, and FERC or court review will be available to resolve disputes. Although any standard setting process is susceptible to anticompetitive manipulation or abuse, the processes at issue do not, on their face, appear to raise significant risks to competition. The Department has no present intention to challenge the proposal.
Formal DOJ Business Advisory Letter
Formal Request for Business Review Letter