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FERC Directs RTO To Refund $307,000 To Supplier

December 18, 2015

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Copyright 2010-15 EnergyChoiceMatters.com
Reporting by Karen Abbott • kabbott@energychoicematters.com

FERC yesterday directed the California ISO to refund $307,500 in erroneous unavailability charges, plus interest, to Shell Energy North America (US), L.P., granting Shell a waiver of the deadline for billing disputes as contained in the tariff

Shell had a sought a refund related to an erroneous settlement statement related to August 2010 which included erroneous unavailability charges. Notably, the error appeared for the first time in the 35th month of the CAISO 36-month invoice and settlement cycle.

FERC said that a waiver was appropriate in this instance because, among other reasons, Shell Energy’s waiver request is limited in scope because the charge to be corrected is the result of a one-time technical error affecting one customer that CAISO was to have resolved months before. FERC also noted that Shell Energy’s identification of the billing error two days after the dispute deadline was an error made in good faith because Shell Energy reasonably relied on CAISO to issue an accurate settlement statement in light of having already corrected this error two years earlier.

FERC noted that the error was not introduced until the very end of the billing process, causing Shell Energy difficulty in meeting the tariff deadline

"We disagree with CAISO’s assertion that identifying the error would have been a 'simple matter.' The erroneous charge on Shell Energy’s T+35M statement was just one element of a 9,405 page document. Moreover, it is undisputed that the error had been previously identified and resolved two years earlier. We agree with Shell Energy that it would have been reasonable to assume that, because the error had been flagged and resolved, subsequent invoices for the next two years would not reflect the same the error," FERC said

CAISO was directed to reopen and resettle Shell Energy’s T+35M statement for August 31, 2013, and to refund the $307,500 in erroneous unavailability charges from the August 2010 trade month, with interest

While FERC granted a waiver with respect to allowing a refund, FERC denied Shell's complaint to broadly find the CAISO tariff to be unjust or unreasonable with respect to settlement timelines. FERC did note that CAISO has stated that CAISO will be initiating a stakeholder process to address billing issues

Docket No. EL15-94

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