§ 16431 — Federal Utility Participation In Transmission Organizations

(a) In this section: (1) The term “appropriate Federal regulatory authority” means— (A) in the case of a Federal power marketing agency, the Secretary, except that the Secretary may designate the Administrator of a Federal power marketing agency to act as the appropriate Federal regulatory authority with respect to the transmission system of the Federal power marketing agency; and (B) in the case of the Tennessee Valley Authority, the Board of Directors of the Tennessee Valley Authority. (2) The term “Federal power marketing agency” has the meaning given the term in section 796 of title 16. (3) The term “Federal utility” means— (A) a Federal power marketing agency; or (B) the Tennessee Valley Authority. (4) The term “Transmission Organization” has the meaning given the term in section 796 of title 16. (5) The term “transmission system” means an electric transmission facility owned, leased, or contracted for by the United States and operated by a Federal utility. (b) The appropriate Federal regulatory authority may enter into a contract, agreement, or other arrangement transferring control and use of all or part of the transmission system of a Federal utility to a Transmission Organization. (c) The contract, agreement, or arrangement shall include— (1) performance standards for operation and use of the transmission system that the head of the Federal utility determines are necessary or appropriate, including standards that ensure— (A) recovery of all of the costs and expenses of the Federal utility related to the transmission facilities that are the subject of the contract, agreement, or other arrangement; (B) consistency with existing contracts and third-party financing arrangements; and (C) consistency with the statutory authorities, obligations, and limitations of the Federal utility; (2) provisions for monitoring and oversight by the Federal utility of the Transmission Organization’s terms and conditions of the contract, agreement, or other arrangement, including a provision for the resolution of disputes through arbitration or other means with the Transmission Organization or with other participants, notwithstanding the obligations and limitations of any other law regarding arbitration; and (3) a provision that allows the Federal utility to withdraw from the Transmission Organization and terminate the contract, agreement, or other arrangement in accordance with its terms. (d) Neither this section, actions taken pursuant to this section, nor any other transaction of a Federal utility participating in a Transmission Organization shall confer on the Commission jurisdiction or authority over— (1) the electric generation assets, electric capacity, or energy of the Federal utility that the Federal utility is authorized by law to market; or (2) the power sales activities of the Federal utility. (1) No statutory provision requiring or authorizing a Federal utility to transmit electric power or to construct, operate, or maintain the transmission system of the Federal utility prohibits a transfer of control and use of the transmission system pursuant to, and subject to, the requirements of this section. (2) This subsection does not— (A) suspend, or exempt any Federal utility from, any provision of Federal law in effect on August 8, 2005, including any requirement or direction relating to the use of the transmission system of the Federal utility, environmental protection, fish and wildlife protection, flood control, navigation, water delivery, or recreation; or (B) authorize abrogation of any contract or treaty obligation.