In petitions for review of two Federal Energy Regulatory Commission orders conditionally approving the California Independent System Operator (CAISO)’s proposal to create an Integrated Balancing Authority Area (IBAA) by combining the Sacramento Municipal Utility District and the Turlock Irrigation District for the purpose of pricing transactions, the petitions are denied where
1) neither the Ninth Circuit’s opinion in Bonneville nor the D.C. Circuit’s opinion in TANC precluded the Commission from asserting jurisdiction over the IBAA proposal; and
2) because section 5 of the agreement defined the scope of the agreement to govern only the joint operation of the three power lines comprising the California-Oregon Intertie, and section 8.4 was properly read in light of section 5, the Commission reasonably concluded that the agreement only prohibited the parties to the agreement from charging each other for unscheduled use of another’s lines associated with parallel flows and did not reach the IBAA proposal, which concerned the CAISO’s ability to set rates within its own market.