Calpine and other merchant companies have long argued that vertically
integrated utilities like Southern have tried to block grid access for
anti-competitive reasons.
FERC, in an order issued late on Tuesday, said Southern improperly restricted
Calpine and Oglethorpe's rights to renew long-term contracts to ship power
across its grid, which stretches across 120,000 square miles.
The agency must approve yearly tariffs filed by Southern and other
jurisdictional utilities before they can take effect.
FERC gave Southern 21 days to prove why the two contracts "should not be
found to be unjust and unreasonable" because they "limit the
transmission customers' rollover rights in a manner contrary" to FERC
policy.
FERC in 1996 passed rules requiring utilities to give competitors equal
access to available space on their transmission grids.
In a separate but related case, FERC last year questioned billions of dollars
worth of long-term deals Southern awarded to one of its affiliates.
In that case, Calpine asked FERC to reject 15-year contracts Southern Power
Co. signed with two utility affiliates for the output from its 1,240 megawatt
McIntosh plant, due to come online in 2005.
Southern, which owns utilities that serve Alabama, Florida, Georgia and
Mississippi, has defended its bidding process as highly competitive.
Calpine and Southern have both made offers to settle the case, but talks have
hit an impasse, according to a report filed by a FERC judge this week. Parties
will go before a FERC judge on March 24.
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