PETITION OF MACLAREN ENERGY, INC. FOR ORDER ACCEPTING RATE SCHEDULE, AUTHORIZING

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R-3636-2007

PETITION OF MACLAREN ENERGY, INC. FOR ORDER

ACCEPTING RATE SCHEDULE, AUTHORIZING

MARKET-BASED RATES, AND GRANTING CERTAIN

WAIVERS AND BLANKET AUTHORIZATIONS

Original : 2008-03-13 HQT-4, Document 1

UNITED STATES OF AMERICA

BEFORE THE

.

~

FEDERAL ENERGY REGULATORYCOMMISSION

Maclaren Energy, Ine.

) DoeketNo. ER01-o1/~00

PETITION OF MACLARENENERGY, INC.

FOR ORDER ACCEPTING RATE SCHEDULE,

AUTHORIZING MARKET-BASEDRATES, AND

GRANTING CERTAIN WAIVERS AND BLANKET

AUTHORIZATIONS

Pursuant to Rules 205 and 207 of the Federal Energy Regulatory Commission's

("FERC" or "Commission") Rules of Praetiee and Procedure, 18 C.F.R. §§ 385.205 and

385.207, Rule 35.12 of the Commission's Regulations, 18 C.F.R. § 35.12, and Section

205 of the Federal Power Aet ("FPA"), 16 V.S.C § 824d, Maclaren Energy, Ine.

("Maclaren") hereby requests the Commission to (a) authorize Maclaren to sell energy and capacity, and certain aneillary services (defined below) at market-based rates pursuant to Maclaren's FERC Rate Schedule No. 1 (Attaehment A); (b) waive certain of the Commission's regulations under the FPA; and (c) grant certain blanket authorizations and approvals under other such regulations. ln support of this petition, Maclaren states as follows:

1.

COMMUNICATIONS AND CORRESPONDENCE

AIl correspondence and communications conceming this Petition should be sent to the following persons, who are also designated for service in these proceedings:

II.

Ginette Berthel

Mac1arenEnergy, Inc.

Corporate Counsel and Secretary

2 Montreal Road West

Masson-Angers, Québec J8M IK6

(819) 986 4616

George H. Williams, Jr.

Cameron McKenna LLP

2175 K Street, NW

Fifth Floor

Washington, D.C. 20037

(202) 466 0060

DESCRIPTION OF PETITIONER AND ITS AFFILIA TES

Mac1aren is a power marketer that is incorporated under the laws of Ontario and is

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based in Masson-Angers, Québec, Canada.

Maclaren does not own generation or transmission assets in Canada, the United States ("U.S."), or any other location.

Maclaren is a wholly owned subsidiary of Great Lakes Power, Inc. ("GLPI"), a Canadian corporation, with its principal place of business in Toronto, Ontario.

GLPI also owns 100% of Great Lakes Power Limited ("GLPL") and 50% of Great

Lakes Power Trust ("GLPT") through its 50% ownership of GLPT's sole parent, Great

Lakes Hydro Income Fund ("Fund"). The remaining 50% of the Fund is publicly held.

Maclaren has entered into an agreement with GLPT to operate and maintain its generation and transmission assets, and into agreements with both GLPT and GLPL to market power on their behalfin Canada and in the V.S.

GLPL is a generationand distributioncompany based in northwesternOntario,

Canada.

GLPL owns 327 MW of generating capacity, and owns and operates approximately440 miles of transmissionlines and 1,055miles of distribution Hnes in

northwestern Ontario. It directly serves approximately 11,000 retail customers and one

2

wholesale customer, the City of Sault Ste. Marie, Ontario. ln 2000, GLPL had sales from internaI generation of 1.369 million MWh and sales from aU sources of 2.30 million

MWh; 85% of these total sales were to two bulk industrial consumers and its single wholesale customer. GLPL has two interconnections with Hydro One Networks, Inc.

("Hydro One"), which owns and operates the transmission facilities in Ontario. (Hydro

One is a successor corporation to the provincial crown corporation, Ontario Hydro.)

GLPL's transmission facilities are not interconnected with the V.S.

GLPT owns three hydroelectric generating stations, totaling 238 MW, and 30 miles of transmission facilities, aU in western Québec, Canada. GLPT does not have a traditional distribution system or service territory. GLPTs transmission facilities consist of two 115kV lines, from which it serves four industrial customers under long-term contracts. ln 2000, GLPT had sales from internal generation of 1.554 million MWh and sales from all sources of 1.573 million MWh.

GLPTs transmission facilities are interconnected with Hydro One and Hydro-Québec. GLPTs transmission facilities are not interconnected with the V.S.

Neither GLPL nor GLPT is subject to the FPA beeause neither owns or operates facilities capable of engaging in interstate commerce transactions, as defined in Section

210(c) of the FPA, 16 U.S.C ~ 824(c). Without interconnectionswith the V.S., neither

GLPL, GLPT, nor any generatoror load-servingentity connectedto the transmission

facilities of either, ean directîy transmit power to, or directiy receive power from, any

U.S. power buyer or seller. ln the case of GLPL, any transmission to or from the V.S.

requires a buy-sell or other arrangement with Hydro One, which controis all of GLPL' s

3

accessto or from the D.S.I ln the case ofGLPT, any transmissionto or ftom the O.S.

require~either a buy-sell transaction with Hydro One or wheeling through Hydro-

Québec, both ofwhich control GLPT's access to the U.S.

GLPI also holds ownership interests in certain independent generation facilities located in the o.S. and Canada. These independent generating entities are small, totaling approximately 400 MW, and are widely dispersed throughout North America. Moreover, the bulk ofthis capacity is fully committed under long-term contracts, and in many cases,

Maclaren's affiliate owns only a partial interest in .the facility.

These entities are:

(I)Louisiana HydroElectric Power -- a 75% residual interest in a partnership that operates a 192 MW hydro-electrie facility near Vidalia, Louisiana, the entire output of which is sold on a long-term basis to Entergy Louisiana, Inc., and the City of Vidalia;

(2) Lake Superior Power

-a 50% owned partnership that operates a 110 MW cogeneration facility in Sauli Ste. Marie, Ontario, the entire output of which is sold on a long-term basis to OEFC;2 (3) Valarie Falls Power ,.- a 65% owned partnership that operates a 10 MW hydro-electric station in northwestem Ontario, the entire output of

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which is sold on a long-term basis to OEFC; (4) Pontiac Power

-the wholly-owned operator of two hydro-electric stations with a combined 28 MW in western Québec, the entire output of which is sold on a long-term basis to Hydro-Québec; and (5) Powell

River Energy, Ine. -- a partnership owned 50% by GLPT that operates a 82 MW hydroelectric station in British Columbia, the entire output of which is sold on a long-term

Wheeling is not currently available on the Hydro One system.

Under the Ontario Energy Competition Act, the former Ontario Hydro has been reorganized into several major corporations, one of which, Ontario Electricity Financial Corporation ("OEFC"), has been assigned the obligations of Ontario Hydro under its wholesale power purchase agreements.

4

basis to Pacific Papers, Inc. GLPI also owns 100% of Highvale Power, a coal supplier located in western Canada, which provide~ approximately 35% of the coal requirements for approximately 2700 MW of capacity, located in western Canada and owned by

TransAlta Corporation.

III.

DESCRIPTION OF MACLARENtS PROPOSED BUSINESS

OPERATIONS

A.

Capacity And Energy Sales; Reassignment Of Transmission Capacity

Maclaren seeks blanket approval under Section 205 of the FPA to charge marketbased rates for sales of electric capacity and energy. ln order to effectuate such sales,

Maclaren seeks approval ofits market-based rate tariff ("Tariff') .(Attachment A). Under the Tariff, Maclaren would be pennitted to sell capacity and energy at market rates and to otherwise engage in the full range of activities previously approved by the Commission for power marketers, including the reassignment of transmission capacity. Long Beach

Generation LLC, 82 FERC

1

61,295 (1998) ("Long Beach").

As provided in

Attachment A, Maclaren will reassign transmission capacity consistent with the conditions established by the Commission. Id.

B.

Ancillary Services

ln Central Hudson Gas & Elec. Corp. et al, 86 FERC 161,062 (1999), the

Commission approved the sale of energy, regulation service, operating reserves and installed capacity at market-based rates through the. markets administered by the New

York Independent System Operator (''NYISO''). ln New England Power Pool, 85 FERC

,

61,379 (1998), the Commission authorized participants in the New England Power Pool

("NEPOOL") to make sales at market-based rates into NEPOOL for seven product

5

markets, including such ancillary services as ten-minute spinning reserve, automatic

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generation control, ten-minute non-spinning reserve, and thirty minute operating reserve.

See also, CH Resources,Inc., 86 FERC

~

61,140 (1999); Edison Mission Marketing &

Trading, Inc., 86 FERC

~ 61,072 (1999); Canadian Niagara Power Company, 87 FERC ~

61,070 (1999) ("Canadian Niagara"). ln addition, in El Segundo Power, LLC et al., 84

FERC

~

61,011, at 61,056 (1998), the Commission held that an entity with market-based rate authority may, under that authority and without obtaining separate authorization, sell ancillary services other than the six ancillary services enumerated under Order No. 888.

If Maclaren's rate schedule is accepted for filing, it intends to sell any and ail ancillary services, whether or not those services are listed in Order No. 888, at marketbased rates, as authorized by the foregoing cases.

IV.

MACLAREN'S APPLICATION PRESENTS NO MARKET POWER

CONCERNS

The Commission authorizes the sale of eIectricity at market-based rates if the se~ler, together with its affiliates, do not have, or have adequately mitigated, market power in generation and transmission and eannot erect other barriers to entry. USGen

Power Services L.P., 73 FERC ~ 61,302, at 61,844 (1995) (ttUSGentt); Heartland Energy

.

Services,Ine., 68 FERC

~

61,233, at 62,060 (1994) (ItHeartlandlt). The Commission will also eonsider whether there is potential for affiliate abuse or reciproeal dealing. Progress

Power Marketing,Ine., 76 FERC

1

61,155, at 61,919 (1996), letter order approving settlement, 79 FERC ~ 61,149 (1997); Northwest Power Marketing Company, LLC, 75

FERC

1

61,281, at 61,889 (1996); Heartland, 68 FERC at 62,060-63.

The Commission has held that the same general standards should be applied when

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reviewing the application of a power marketer that is affiliated \\<1tha Canadian electric utility and that seeks to transact in the U.S. at market-based rates.

Energy Alliance

Partnership, 73 FERC

,

61,019, at 61,030-31 (1995) ("Energy Alliance"); TransAlta

Enterprises Corporation, 75 FERC

,

61,268, at 61,874 (1996) ("TransAlta"); British

Columbia Power Exchange Corporation, 78 FERC

,

61,024, at 61,100 (1997)

("Powerex"); Ontario Hydro Interconnected Markets Inc., 78 FERC

,

61,369 at 62,528

(1997) ("Ontario Hydro"); H.Q. Energy Services (U.S..), 79 FERC

,

61,152 at 61,652

(1997) ("H.Q. Energy Services").

As explained below, Maclaren meetsthe Commission's standards for marketbased rate authority. Accordingly, Mac1aren requests that the Commission accept its proposed rate schedule for filing.

A.

Maclaren And Its Affiliates Do Not Possess Generation Market Power

Maclaren does not own or control any generation facilities in the U.S., and with the exception of one 192 MW facility in Louisiana (the output of which is fully committed under a long-terro contract), no affiliate of Maclaren owns orcontrols

generationfacilitiesin the V.S.

ln analyzing generation market power of an applicant and its affiliated utilities, the Commission looks at the affiliated utility's share of installed and uncommitted generating capacity in the market with which the affiliate 'Ïs directly interconnected (first-

tier market). Louisville Gas_~ Electric Co., 62 FERC , 61,016, at 61,146 (1993)

("Louisville"). As demonstrated below, GLPL and GLPT do not have generation market power in any of the relevant geographic markets.

GLPL and GLPThave no first-tier U.S. destination markets. GLPL and GLPT's

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first-tier generation markets are located in Ontario and Québec, Canada, respectively.

Neither GLPL nor GLPT (whether separately or combiiled), exert generation market power in Ontario or Québec.

See, Attachment B, Navigant Consulting Ltd.'s

("Navigant") "Market Power Analysis of Great Lakes Power, Inc. and Affiliated

Companies" ("Navigant Study"). Appendix A, Table A-4, of the Navigant Study shows that the installed capacity in the Ontario destination market is 111,935 MW.

ln comparison, the installed capacity of aIl of Maclaren's affiliates (including generation fully committed under long-term contracts) is 987 MW. See, Attachment B, Table 2, p.9.

This amounts to less than 0.9% of the installed capacity in the Ontario destination market.

Similarly, as shown in Appendix A, Table A-5, of the Navigant Study, the installed capacity in Hydro-Québec's destination market is 138,174 MW.

Maclaren's affiliates' total installed capacity of 987 MW represents less than 0.8% of the installed capacity in the Hydro-Québec destination market. Moreover, these figures are conservative because they attribute capacity to Maclaren that is located far from the destination markets, namely in Louisiana and British Columbia.

Even on the basis of these conservative figures, Maclaren and its affiliates do not exercise generation market power in Ontario or

Québec.

Since GLPL and GLPT do not have generation market power in their first-tier destination markets, it follows that they do nothave generation market power in their second-tier destination markets, in this case the U.S. See, CU Power Canada Limited, 85

FERC, 61,216 at 61,887 (1998); TransAlta, 75 FERC at 61,875.

Based on CUITentcircumstances, the Commission need go no further and should determine that Maclaren does not possess generation market power.

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, \

.

It is possible that Maclaren's affiliate, GLPL, will in the future have first-tier

~ destination markets in the U.S in the future.

At present, this possibility represents a hypothetical scenario that the Commission need not address in approving tt'1ispetition.

Nonetheless, in the interest of full disclosure, we discuss this scenario below.

As the Commission is aware, the Ontario electricity industry is in the process of restructuring under the Ontario Electricity Act, 1998. Pursuant to this restructuring,

GLPL's transmission system may be integrated with Hydro One, to become part of the

Ontario transmission grid, under' the direction of the Independent Electricity Market

Operator ("IMO").

The IMO is the independentsystem operator that will direct the operation of the Ontario transmission grid and will oversee the Ontario deregulated markets. If this integration occurs, it may become necessary for the generation market power analysis to' include Ontario's first-tier U.S. destination markets, namely, the

NYISO, Minnesota Power, and Detroit Edison.

The Navigant Study demonstrates that even if GLPL's system was integrated with

Hydro One (which it is not), GLPL's shaf(~of installed capaeity would represent 1% or less of the total installed capacity in the identified destination markets. See, Attachment

B, Table 3, p.lO and Appendix A, Tables A-l, A-2 and A-3.) Thus, even if GLPL's system were integrated with Hydro One, Maclarenand its affiliates would still not.

possess generation market power.

See, Public Service Company of Indiana, Ine., 51

FERC

~

61,367 at 62,204 (1990); Southwestem Public Service Company, 72 FERC

~ ln calculating the market shares of installed capacity in each of the identified U.S. destination markets, Navigant aggregated the capacity of Maclaren's affiliates (987 MW) less the capacity that is committed under long-term contracts (554 MW) Le., 433 MW.

See, Attachment B, Table 2, p.9.

9

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-,

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-

,

61,208 at 61, 966 (1995); USGen, 73 FERC ~ 61,302 at 61,844-61,845.4

:.:.

Based on the foregoing, Maclaren and its affiliates do not possess generation market power in any of the relevant geographic markets.

B.

Maclaren And Its Affiliates Do Not Possess Transmission Market

Power

Neither Maclaren nor its affiliates own, control, or operate any electric transmission facilities within or directly interconnected with the V.S., and so cannot exert transmission market power in the V.S.s

Vnder Commission precedent, a power marketer's transmission market power is adequately mitigated when it, and any of its affiliates that own or control transmission facilities, agree to provide comparable transmission service on their transmission facilities on substantially the same terms as those set forth in the Commission's pro forma tariff.

Heartland, 68 FERC at 62,061.

Generally speaking, the Commission has determined that when a power marketer with Canadian transmission~wning affiliates seeks the right to sell power at market-based rates in the D.S., the Commission will

,

Navigant's analysis is consistent with Commission precedent. See, Enron Power Marketing, Inc., 65 FERC

61,305 (1993), order on rehearing, 66 FERC, 61,244 (1994) ("Enron Power'').

4 ln discussing

the Ontario restructuring, the Navigant Study addresses a scenario that, while presently hypothetical, is currently pending.

The Ontario restructuring is scheduled to go into effect by

May, 2002.

A second possibility, which is not currently pending but rather is merely in preliminary planning stages, involves the possible construction and operation, directly orthrough an affiliated entity, of an approximately two-kilometer 300 MW transmission intertie ("ITL") under the S1. Mary's River, from

Sault Ste. Marie, Ontario to Sault Ste. Marie, Michigan.

If constructed, this intertie would connect the

GLPL system with the transmission system in the upper Michigan peninsula, and would make Wisconsin and upper Michigan first-tier markets.

However, given the relative size of MacIaren's affiliated generation compared to the Wisconsin and upper Michigan markets, it is obvious that Maclaran and its affiliates would still not have generation market power in those markets.

The Navigant Study has not formally evaluated Wisconsin Electric as a separate destination market since the ITL is only in the planning stages at this point, but that Study shows that Great Lakes' market share of the Wisconsin Electric destination market would be 0.6%. See, Attachment B, Table 2, p.9.

Maclaren will advise the Commission if the ITL, discussed above, deveh>ps into a proposaI.

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condiûon such right on assurances that reciprocal transmission service will be provided by such transmission-owning affiliates. TransAlta, 75 FERC at 61,875./

However, the Commission has found, in certain circumstances like those presented here, that it will grant market-based rates to an entity, without requiring the

Canadian transmission-owning affiliate of that entity to file a Open Access Transmission

Tariff(110AITtI).

Canadian Niagara, 87 FERC at 61,289. ln that case, the Commission held that the Canadian transmission-owning affiliate did not have to file an OATT, because it was "not directly interconnected with the V.S." and because it owned only tllimited and discrete transmission facilities" under the standard set forth in Black Creek

Hydro, Inc., 77 FERC

11

61,232 (1996) ("Black Creek").

Both of these circumstances are found in this case. The transmission facilities owned by GLPL and GLPT serve exclusively intra-Canadian customers and are "not directly interconnected with the V.S." ln addition, both GLPL and GLPT are small utiliûes and not members of a tight power pool, which qualifies them as owning I1limited and discrete facilities" under Black Creek, 77 FERC at 61,940. GLPL's and GLPT's total

2000 energy sales (from aH sources) were approximately 2.30 million MWh and 1.573

million MWh, respectively, and 50 they meet the Commission's and the Small Business

Administration's. definiûon of a small public utility (Le., disposes of no more than 4 million MWh annually). Id. at 61,941. Moreover, neither GLPL nor GLPT are members

6

The Commissionhas made it cIear that it does not seek to open intra-Canadaelectric markets through the imposition of open access tariffs for transactions wholly within Canada.

Powerex, 78 FERC at

61,100; Ontario Hydro, 78 FERC at 62,528.

.

11

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1

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1

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1

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,-

,

1

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1 of a tight power pool.1

Requiring an OATT is not necessary either on grounds of reciprocity or to further

the goals of Order No. 888 to. open U.S. transmissionmarkets. GLPL's and GLPTs transmission facilities exclusively serve intra-Canadian.markets, and requiring open

access in Ontario or Québec would only affect intra-Canadian markets. Neither GLPL nor GLPT can exercise transmission market power themselves, or confer transmission market power upon Maclaren. Accordingly, under the standards that the Commission has established, the Commission should not condition Madaren's request for market-based rates on a requirement that Maclaren's Canadian affiliates file an OA TT.

While an OATT is not required in these circumstances, Maclaren wishes to assure the Commission that the basic principles underlying the Commission's open access mies are being followed by GLPT and GLPL.

GLPT has prepared an OATT that substantially mirrors the Commission's pro

forma tariff.8 GLPT commits that it will abide by this tariff, which is attached hereto.

See, Attachment C.

ln the case of GLPL, the transmission facilities are located in Ontario. As the

Commission is aware, the Ontario markets are in the process of restmcturing, with the

7

As discussedbeJow,the fact that GLPL and GLPT would qualifyas sInaIlpublic utilitiesjustifies waiver of the requirements ofOrder No. 889. See note 13, infra. Maclaren requests such a waiver.

&

There are some minor differencesbetweenGLPT's tariff and the pro forma tariff. These minor differences reflect the facts that GLPT: (1) is located in Canada (e.g., the tariffrefers to Canadian Law, and deletes any reference to U.S. regulatory authority), (2) is part of the Hydro-Québec controlarea (e.g., tariff scheduling procedures track those used in Hydro-Québec's tariff), and (3) is a very small system that qualifies for the Black Creek exception (e.g., the tariff has simpler application procedures).

Notwithstanding these differences, the GLPT tariff provides for service comparable to that under the pro

forma tariff, -and satisfies its basic open access principles. Like the pro forma tariff, the enclosed GLPT tariff includes the terms and conditions under which it will provide service. The rates for such service to

Canadian entities have been omitted for present purposes as outside of the Commission's jurisdiction.

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restructured markets expected to go into operation by May 2002.

The Ontario

restructured markets contemplate open access transmission service that is equal or superior to the transmission that would be provided under the pro forma tariff.

See,

Ontario Eleetricity Act, 1998, Part III, The Eleetricity Markets, Section 26. See also,

Ontario

Energy Board, Transmission System Code

(http://www.oeb.gov.on.calenglishlhome.htm).

which contemplates full open access transmission service for all participants in the Ontario market. As a licensed transmitter in Ontario, GLPL will be required to follow the Transmission System Code.

Based on the foregoing, Maclaren and its affiliates do not possess transmission market power in any of the relevant geographic markets.

c.

Maclaren And Us Affiliates Do Not Erect Any Barriers To Entry

Neither Maclaren nor any of its affiliates ereet any barriers to market entry.

Except for limited power plant sites held by GLPT and Pontiac Power, neither Maclaren,

Dor any of its affiliates, owns or controls any plant sites, gas pipeline. or gas distribution facilities, engineering and construction firms or other inputs to the power production process that conceivably could impose barriers to market entry by other power suppliers.

Heartland, 68 FERC at 62,064; Wallkill Generating Company, L.P., 56 FERC

,

61,067

(1991); Doswell Limited Partnership, 50 FERP 1

61,251 (1990).

GLPT and Pontiac Power own development rights for a total of three (3) additional hydroelectric facilities in Québec,9 but this limited ownership of sites for one type of generation does not constitute a barrier to entry because market participants have

9

Cedar Falls is an 8.5 MW facility,Chute de la Montagneis a 33 MW facilityand Lac au Pin is a

40 MW facility, for a total of 81.5 MW.

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abundant opportunities for siting in the area.

.

As indicated above:GLPI is the 100%ownerof HighvalePower,a coal supplier in westernCanada. Such fuel suppliesare not among the inputs that cause concernas indiciaof market power. Louis DreyfusElectricPower,Inc., 61 FERC

1f

61,303 (1992);

Enron Power Enterprise Corp., 52 FERC, 61,193 (1990); Enron Power Enterprise Corp.,

65 FERC, 61,305 (1993).

ln any event, Maclaren understands that the Commission may revoke any marketbased rate authority it grants to Maclaren in the event that any of its competitors complains that any of its affiliates denies, delays, or otherwise requires unreasonable terms, conditions or rates for, fuel services to any such potential competitor. Louisville,

62 FERC at 61,148; Energy Alliance, 73 FERC at 61,031; Heartland, 68 FERC at 62,064.

Furthennore, Maclaren commits to infonn the Commission of any changes in investments or other entry barriers that may be relied upon in approving market-based rate authority, including ownership of generation, or transmission facilities, or inputs to power production other than fuel supplies, affiliation with any entity that owns generation or transmission facilities, or affiliation with any entity owning or controlling a franchised service territory. Morgan Stanley Capital Group Inc. et al., 69 FERC, 61,175 at 61,695, order on reh'g, 72 FERC, 61,082, at 61,437 (1995); Engelhard Power Marketing, Inc., 70

FERC, 61,250, at 61,778 (1995); Canadian Niagara, 87 FERC at 61,291.

D.

Reciprocal Dealing And AffiliateAbuse Are Of No Concem

While Mac1aren is affiliated with GLPL and GLPT, reciprocal dealing and affiliate abuse are not of concern because power sales, and sales of non-power goods and services, from or to Mac1aren's Canadian affiliates are solely Canadian rate-making

14

matters and so are outside the Commission's jurisdiction. Energy Alliance, 73 FERC at

~

61,031; TransAlta, 75 FERC at 61,876; H.Q. Energy Services, 79 FERC at 61,654;

Powerex, 78 FERC at 61,101; Powerex II, 80 FERC at 62,140. Moreover, even ifthis

Commission did have jurisdiction, neither GLPL nor GLPT is a franchised utility with captive ratepayers in the D.S. and so reciprocal dealing and affiliate abuse are unlikely to create reason for concern. Koch Power Louisiana, L.L.C., 86 FERC 161,029 at 61,127

(1999); Southern Indiana Gas & Electric Company, 77 FERC

1

61,024 at 61,093 (1996).

V.

REPORTING REQUIREMENTS

Maclaren will comply with the Commission's reporting requirements relating to transactions that result in delivery of electricity to customers in the U.S. under its FERC

Rate Schedule No. 1 on a quarterly basis (but not to include customers located in Canada or otherwise only in foreign commerce).

Powerex II, 80 FERC at 62,141; Canadian

Niagara, 87 FERC at 61,291.

ln addition, Maclaren agrees to either (i) infonn the

Commission promptly of any changes in status that would reflect a departure from the characteristics that the Commissic;mrelied upon approving market-based pricing; or (ii) report such changes in an updated market analysis filed every three years for Mac1aren and its affiliates.

VI.

W AIVERS, BLANKET APPROV ALS, AND AUTHORIZA TIONS

The Commission has consistently granted certain waivers of its regulations, and blanket approvals, to power marketers affiliated with Canadian utilities and to other entities that lack market power and that are market-based rate sellers.

USGen, 73 FERC at 61,847; Louisville, 62 FERC at 61,152; TransAlta, 75 FERC at 61,876. Accordingly,

Mac1aren requests that the Commission grant the following waivers and blanket

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approvals:

(1) waiver of Parts 41, 101 and 141 of the Commission's accounting and periodic reporting and filing regulations;

(2) waiver of the full reporting requirements ofSubparts B and C of Part 35 of the Commission's regulations, except for Sections 35.12(a), 35. 13(b),

35.15 and 35.16;

(3) waiver of the 60-day notice requirements in Section 35.3 of the

Commission's regulations, except to the extent that Maclaren will be required to file notices of cancellation and succession;

(4) permission to file an abbreviated statement with respect to Parts 45 and 46 of the Commission's regulations;

(5) blanket authorization under Section 204 of the FPA and Part 34 of the

Commission's regulations, for all future issuances of securities and assumptions of liability;

(6) a determination, to the extent indicated,IO that funds received in connection with power sales are not jurisdictional "facilities" within the meaning of Section 203 of the FPA, and that sales of accounts receivable do not constitute disposition ofjurisdictional facilities under Section 203;

(7) a limitation of the requirements of Section 203 of the FPA to disposaI by

Maclaren of jurisdictionaI facilities located in the U.S. with a vaIue in excess of $50,000;11

(8) a limitation on the Commission's annual charges to those sales under the

Maclaren Tariff;12

(9) waiver ofOrder No. 889 requirements;13 and

10 Maclaren does not seek a declaratory order in this regard and intends to rely upon the

Commission's prior orders. Origen Generating Corporation"and OEG Energy Resources, Inc., 83 FERC

,-

61,250, at 62,064, fÏ1.20 (1998); WIŒ Station Two, Inc., 82 FERC,. 61,178, at 61,653, fn. 7 (1998);

MillenniumPowerPartners,L.P., 82 FERC ,. 61,024,at 61,074,fn. 8 (1998);CanadianNiagara,87 FERC at61,291,fu.11.

"

11

12

Canadian Niagara, 87 FERC at 61,291, fÏ1.12.

CanadianNiagara,87FERCat 61,291,fn. 13.

13 The Commission has granted such waivers to ttsmall public utilitiestt that own, operate, or control an integrated transmission grid, unless the small public utility is a member of a tight power pool or other circumstancesare presentwhich indicate that a waiver is notjustified. BlackCreek, 77 FERC

11

61,232.

As discussed above, GLPL and GLPT satisfy these standards. Hence, the requirements of Order No. 889 do not apply here.

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(10) such other waivers, blanket authorizations and modified requirements as the Commission may in the future apply to affiliated Canadian power marketers such as Maclaren.

VII.

FORM OF NOTICE

A Notice of Filing suitable for publication in the Federal Register is attached hereto. (Attachment D). This notice is also contained in the enclosed 3.5 inch diskette, as required by the Commission's Revision of Form of Notice Requirements in Docket

No. RM96-16-000, Order No. 593, 78 FERC

~

61,002 (~997).

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VIII.

CONCLUSION

WHEREFORE, MacIaren respectfully requests that the Commission issue an order accepting for filing Maclaren's FERC Rate Schedule No. 1, to become effective on the date of the Commission's order granting the Petition, and grant the waivers and blanket approvals sought herein.

Respectfully submitted,

4L~

John J. Bartus

Cameron Mckenna LLP

2175 K Street, NW

Fifth Floor

Washington, D.C. 20037

Attorneys for Maclaren Energy, Ine.

Dated: May 24, 2001

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