	Introduction

The Energy Policy Act of 2005 ( P.L. 109-58 ), signed by President Bush on August 8, 2005,was the first omnibus energy legislation enacted in more than a decade. Major provisions include taxincentives for domestic energy production and energy efficiency, a mandate to double the nation'suse of biofuels, faster procedures for energy production on federal lands, and authorization ofnumerous federal energy research and development programs. This report describes the electricityprovisions. All ERO standards will beapproved by FERC. Under this title, the ERO can impose penalties on a user, owner, or operator ofa bulk power system that violates any FERC-approved reliability standard. The Secretary of Energy is required to conduct a study of electrictransmission congestion every three years. Based on the findings, the Secretary of Energy maydesignate a geographic area as being congested. Under certain conditions, FERC is authorized toissue construction permits. New FPA Section 216(e) will allow permit holders to petition in U.S. District Court to acquirerights-of-way through the exercise of the right of eminent domain. An applicant for federal authorization to site transmission facilities on federal lands couldrequest that the Department of Energy be the lead agency to coordinate environmental review andother federal authorization. If a federal agency has denied an authorization requiredby a transmission or distribution facility, the denial could be appealed by the applicant or relevantstate to the President. (6) Thissection repeals the mandatory purchase requirement under Section 210 of PURPA for new contractsif FERC finds that a competitive electricity market exists and a qualifying facility has access toindependently administered, auction-based, day-ahead, real-time wholesale markets and long-termwholesale markets. It also federally regulated holding companies ofinvestor-owned utilities and provided for Securities and Exchange Commission (SEC) regulationof mergers and diversification proposals. The Public Utility Holding Company Act and the Federal Power Act of 1935 (Title I andTitle II of the Public Utility Act) established a regime of regulating electric utilities that gave specificand separate powers to the states and the federal government. State Access to Books and Records (Sec. FERC is directed to facilitate price transparency in wholesale electric markets. FERC is directed to rely on existing pricepublishers and providers of trade processing services the maximum extent possible. However,FERC may establish an electronic information system if it determines that existing price informationis not adequate. The FederalPower Act is amended to give FERC approval authority over the acquisition of securities and the merger, sale, lease, or disposition of facilities under FERC's jurisdiction with a value in excess of$10 million.
The Energy Policy Act of 2005 ( P.L. 109-58 ), signed by President Bush on August 8, 2005,was the first omnibus energy legislation enacted in more than a decade. Major provisions include taxincentives for domestic energy production and energy efficiency, a mandate to double the nation'suse of biofuels, faster procedures for energy production on federal lands, and authorization ofnumerous federal energy research and development programs. This report describes the electricityprovisions. It will not be updated.
Title XII authorizes the Federal Energy Regulatory Commission (FERC) to certify a nationalelectric reliability organization (ERO) to enforce mandatory reliability standards for the bulk powersystem. All ERO standards must be approved by FERC. The ERO can impose penalties on a user,owner, or operator of the bulk power system for violations of any FERC-approved reliabilitystandard.
The Secretary of Energy is required to conduct a study of electric transmission congestionevery three years and may designate a geographic area as being congested. Under certain conditions,FERC is authorized to issue construction permits in congested areas. Permit holders may petitionin U.S. District Court to acquire rights-of-way through eminent domain. An applicant for federalauthorization to site transmission facilities on federal lands could request that the Department ofEnergy be the lead agency to coordinate environmental review and other federal authorization. Ifa federal agency has denied an authorization required by a transmission or distribution facility, thedenial could be appealed by the applicant or relevant state to the President.
Section 210 of the Public Utility Regulatory Policies Act (PURPA) had required utilities topurchase power from all qualifying facilities and small power producers at a rate based on theutilities' avoided cost. The Energy Policy Act repeals the PURPA mandatory purchase requirementfor new contracts if FERC finds that a competitive electricity market exists and a qualifying facilityhas adequate access to wholesale markets.
Also repealed is the Public Utility Holding Company Act of 1935 (PUHCA), which restrictedthe structure of holding companies of investor-owned utilities and provided for Securities andExchange Commission (SEC) regulation of mergers and diversification proposals. FERC and stateregulatory bodies must be given access to utility books and records.
FERC is directed to facilitate price transparency in wholesale electric markets, relying onexisting price publishers and providers of trade processing services to the maximum extent possible. However, FERC may establish an electronic information system if it determines that existing priceinformation is not adequate. FERC is given approval authority over the acquisition of securities andthe merger, sale, lease, or disposition of facilities under FERC's jurisdiction with a value in excessof $10 million.