Standards of Conduct Procedures to Implement FERC Order No. 2004

Atlantic City Electric Company
Delmarva Power & Light Company
Potomac Electric Power Company

STANDARDS OF CONDUCT FERC ORDER 2004 AND 2004-A
PART 358 – STANDARDS OF CONDUCT
STANDARDS OF CONDUCT FERC ORDER 2004 AND 2004-A HR ROCEDURE

Updated September 22, 2004

 

 

Applicability
This document describes the procedures of Atlantic City Electric Company (“ACE”), Delmarva Power & Light Company (“Delmarva”) and Potomac Electric Power Company (“Pepco”) (collectively, the “Companies”) to implement the Federal Energy Regulatory Commission’s (“FERC”) Order No. 2004 Standards of Conduct (“Procedures”). ACE, Delmarva and Pepco are Transmission Providers and subsidiaries of the parent company, Pepco Holdings, Inc. (“PHI”). The Standards of Conduct apply to the relationship between the Transmission Employees of ACE, Delmarva and Pepco and the Marketing Employees and Energy Affiliates in the PHI corporate family. A copy of these Procedures has been distributed to the Transmission Employees and Marketing Employees of ACE, Delmarva and Pepco and Energy Affiliates in the PHI corporate family who have access to information about transmission, energy, power or marketing.

The Companies have posted these Procedures, FERC’s Standards of Conduct regulations in Part 358 (“FERC Regulations”), and the Companies’ organizational charts and job descriptions on the following internet sites: (1) for ACE and Delmarva (Conectiv) at www.conectiv.com; and (2) for Pepco at www.pepco.com. The PJM OASIS has a link to these procedures at PJM Company Transmission Provider Information. The Procedures include the appropriate references to the FERC Regulations.

Strict Compliance Policy.
It is the Companies’ policy to strictly comply with the FERC Standards of Conduct, as well as the other federal and state codes and standards that are applicable to one or all of the Companies. As a PHI employee, it is your responsibility to review these Procedures and the FERC Regulations, and to understand your responsibilities under the FERC Standards of Conduct and what you may or may not do under the Standards of Conduct. It is important to recognize that many activities and interactions between PHI business units and subsidiaries do not involve any conflict with the Standards of Conduct. Just as it is your responsibility not to violate the Standards of Conduct, it is also your responsibility to be aware of what activities are permitted by the Standards of Conduct. Employees should be careful not to under-interpret or over-interpret the Standards of Conduct.

IF YOU NEED HELP: Please contact your supervisor or the Chief Compliance Officer (see below) with any questions concerning the appropriate application and interpretation of the Standards of Conduct that may govern your work function and any work activities or situations in which you need guidance. As in most situations, good judgment and common sense should guide your decisions about how to interpret and apply this business policy. If you need help interpreting this policy or if you observe potential violations of it, contact your supervisor or the Chief Compliance Officer. Every PHI employee, regardless of employment status, is expected, and has a continuing responsibility, to comply with these Standards of Conduct Procedures and the Standards of Conduct Regulations in every decision made and in every action taken in the conduct of PHI’s businesses.

Failure to comply with this or other compliance policies may result in discipline, up to and including discharge.

General Principles

  1. Independent Functioning:

    Except in emergency circumstances (See Emergency Procedures below), Transmission Employees of ACE, Delmarva and Pepco shall function independently of Marketing Employees of the Companies and Energy Affiliate Employees. (Reference FERC Regulations 358.2.)

    A Transmission Employee is a person (employee, Company contractor, consultant or agent) who conducts transmission systems operations or reliability functions for any of the Companies, including but not limited to those who are engaged in day-to-day duties and responsibilities for planning, directing, organizing or carrying out transmission-related functions. (Reference FERC Regulation 358.3(j).)

    A Marketing Employee is a person that engages in the sale or brokering for resale of natural gas or electric energy in interstate commerce on behalf of Pepco, ACE and/or Delmarva. (Reference FERC Regulation 358.3(e).)

    An Energy Affiliate Employee is an employee of any division of the Companies that is a functional unit or an employee of a subsidiary of PHI, if the functional unit or subsidiary engages in transmission transactions in energy or transmission markets; manages or controls transmission capacity; buys, sells or trades natural gas or electric energy; or engages in financial transactions relating to the sale or transmission of natural gas or electric energy. (Reference FERC Regulation 358.3 (b), (d) and (e).)

  2. Separate Operations:

    ACE, Delmarva and Pepco are prohibited from permitting Marketing Employees or Energy Affiliates Employees from:

    1. Conducting transmission system operations or reliability functions;
    2. Having access to a system control center or similar facilities used for transmission operations or reliability functions that differs in any way from the access available to other transmission customers. (Reference FERC Regulation 358.4(a)(3)); and
    3. Having access to transmission information that is not publicly available to similarly situated entities. (Reference FERC Regulation 358.5(a).)
  3. Shared Employees:

    ACE, Delmarva and Pepco are permitted to share support employees and field and maintenance employees with their Marketing Employees and Energy Affiliate Employees. The Companies also are permitted to share senior officers, directors and risk management employees who are not Transmission Employees. (Reference FERC Regulation 358.4(a)(4) and (5).)

  4. Non-Discriminatory Transmission Access:

    ACE, Delmarva and Pepco will treat all transmission customers, both affiliated and non-affiliated, the same with respect to any requests regarding the use and operation of the transmission system. No benefit shall accrue to any affiliated marketing or energy company or division as a result of its affiliation. (Reference FERC Regulation 358.2(b).)

Chief Compliance Officer

  1. Designation of Chief Compliance Officer:

    The Companies have designated Kirk J. Emge, Vice President, Legal Services and General Counsel of ACE, Delmarva, Pepco and Conectiv Energy Services, Inc., as the Chief Compliance Officer for the PHI companies. Mr. Emge can be reached by phone at 202-872-2890. Please forward any questions regarding specific compliance issues to Mr. Emge (kjemge@pepco.com) and Ms. Mindy Herman (mherman@pepco.com). Any questions regarding the Standards of Conduct will be logged and maintained by the Legal Department. (Reference FERC Regulation 358.4(e)(6).)

  2. Responsibilities:

    The Chief Compliance Officer is responsible for overall compliance with the FERC Standards of Conduct, including training, answering employee questions and ensuring compliance. As noted below, the Chief Compliance Officer also will oversee requests from Managers for access to transmission information and grant employees access to transmission areas and information as appropriate in accordance with the Standards of Conduct.

    Separate Operations and Information Access
    No employee who is a Marketing Employee or an Energy Affiliate Employee may be a Transmission Employee for ACE, Delmarva or Pepco. Transmission Employees must operate in physically separate locations from Marketing Employees and Energy Affiliate Employees. Only Transmission Employees may have access to non-public transmission information. (Reference FERC Regulation 358.4(a)(3)(2) and 358.5(a)(1) and (2).)

    The Marketing Employees who are located in shared office buildings are located on a different floor from the Transmission Employees that are located in that office building. These Transmission employees perform their daily activities in an area secured by code card access. Transmission Employees in Pepco’s Transmission Control Center are located in a separate, physically-secured office building.

    Marketing Employees and Energy Affiliate employees are not permitted to enter the office space of any Transmission Employees at any shared office buildings or the Transmission Control Centers of Pepco, ACE and Delmarva. All other non-Transmission Employees are required to sign an access log immediately upon entry to the Transmission Control Centers.

    PHI’s external Energy Affiliate Employees are located in separate buildings in Arlington, VA and Newark, DE, where no Transmission Employees are located.

Procedures for Separate Operations and Information Access

  1. The manager of a department or division that includes Transmission Employees shall ensure that only employees with authorization shall have access to transmission areas and transmission information.

    1. Access to transmission areas is secured by locked doors with special card-key access. Marketing Employees and Energy Affiliates are not permitted access to secured areas.

    2. To the extent any transmission information is stored on a local area network (LAN) that is shared between Transmission Employees and those not authorized to have access to transmission information, the access to transmission information is protected by password and no person has access to that information without authorization by the Chief Compliance Officer.

    3. All PHI employees with desktop computers have installed on those desktops a security system that clears the screen after being inactive for ten minutes and requires employee-specific password input prior to renewed activity on that desktop. This password security prevents unauthorized persons from gaining computer access to protected transmission or market information.

    4. Visitor access to the Transmission Control Centers is granted by the managers of the control centers. Marketing Employees and Energy Affiliate Employees are not permitted to have access to the Transmission Control Centers. All persons who enter the Transmission Control Centers who do not have key card access must sign entry logs.

  2. The Chief Compliance Officer shall oversee all authorizations for access to transmission areas and transmission information.

  3. The managers of the control centers and/or the manager of a department or division that requires access to transmission information shall inform the Chief Compliance Officer if any person authorized to have access to secured areas and transmission information is moving within the Companies or leaving the Companies. All access to secured areas where transmission functions are performed and to non-public transmission information, non-public information acquired from non-affiliated transmission customers or potential non-affiliated transmission customers and non-public information developed in the course of responding to requests for transmission or ancillary service shall be terminated for any employee who has left a Transmission Employee position.

  4. The managers of the control centers and/or the manager of a department or division that requires access to transmission information shall inform the Chief Compliance Officer of any requests for authorization for access to transmission areas and information.

  5. The transfer of any Transmission Employee to a Marketing Employee function or an Energy Affiliate Employee function and the transfer of any Marketing Employee or Energy Affiliate Employee to a Transmission Employee function shall follow the procedures set forth in the HR Procedure for the FERC Standards of Conduct (Attachment A). In compliance with the HR Procedure, the affected Manager of the Transmission Employee or Transmission function shall, not less than 2 days before the change in position, inform the Client Services department of the change and order the appropriate posting on the Company’s internet Web site. (Reference FERC Regulation 358.4(c))

Prohibited Information Sharing

Transmission Employees must ensure that Marketing Employees and Energy Affiliate Employees do not obtain non-public transmission information through any vehicle other than an internet Web site, an OASIS or PJM. Examples of transmission information that may not be shared include: information about available transmission capacity, price, curtailments, ancillary services, maintenance activities, capacity expansion plans or similar information. (Reference FERC Regulation 358.5(a)(2).)

It is prohibited for anyone to act as a conduit for the transfer of information covered by the prohibitions in these Procedures to Marketing Employees or Energy Affiliate Employees. (Reference FERC Regulation 358.5(b)(7).)

Below are examples of information that may not be shared with Marketing Employees and Energy Affiliate Employees except pursuant to OASIS or internet postings:

  1. any information concerning the transmission system of ACE, Delmarva or Pepco or the transmission system of another (including, but not limited to, information received from non-affiliates or information about available transmission capability, price, curtailments, storage, ancillary services, balancing, maintenance activity, capacity expansion plans, or similar information) through non-public communications conducted off the PJM OASIS through access to information not posted on the PJM OASIS that is not contemporaneously available to the public, or through information on the PJM OASIS that is not at the same time publicly available; and

  2. any information acquired from non-affiliated transmission customers or potential non-affiliated transmission customers with employees of its Marketing or Energy Affiliates, except to the limited extent information is required to be posted on the OASIS in response to a request for transmission service or ancillary services.

Marketing and Energy Affiliate employees may not be present at any discussions during which non-public transmission information is discussed. Minutes from such meetings shall note where any Marketing or Energy Employees were removed and shall not include any Transmission Information.

Any information that is provided to a Marketing Employee or an Energy Affiliate employee in violation of these information sharing prohibitions must be posted on the applicable Web site immediately. Any person who believes that such a violation occurred should contact the Chief Compliance Officer immediately. (Reference FERC Regulation 358.5(b)(3).)

Permitted Information Sharing
ACE, Delmarva and Pepco are not required to contemporaneously disclose to all transmission customers or potential transmission customers specific customer information if it relates solely to a Marketing division’s or Energy Affiliate’s specific request for transmission service. (Reference FERC Regulation 358.5(b)(5)).

ACE, Delmarva and Pepco may share generation information necessary to perform generation dispatch with Marketing Employees and Energy Affiliate Employees that does not include specific information about individual third party transmission transactions or potential transmission arrangements. There is no prohibition against sharing information that is necessary to maintain the operations of the transmission system. (Reference FERC Regulation 358.5(b)(6) and (8)).

A non-affiliated transmission customer may voluntarily consent, in writing, to allow ACE, Delmarva or Pepco to share the non-affiliated customer's information with Marketing or Energy Affiliate Employees. If such authorization is obtained, such release must be posted in a notice on the Web site with a statement that the affected Company did not provide any preferences, either operational or rate-related, in exchange for that voluntary consent. (Reference FERC Regulation 358.5(b).)

Implementing Tariffs

The Companies operate under the PJM Tariff and do not generally perform tariff administration. To the extent ACE, Delmarva or Pepco implement transmission tariffs on behalf of PJM, the Companies shall apply all tariff provisions in a non-discriminatory manner. No preference shall be given to a Marketing Employee or Energy Affiliate Employee over any other wholesale customer in matters relating to the sale or purchase of transmission service (including, but not limited to, issues of price, curtailments, scheduling, priority, ancillary services, or balancing). (Reference FERC Regulation 358.5(c).)

Emergency Procedures

Notwithstanding any other provisions in these Procedures, in emergency circumstances affecting system reliability, the system operators may take whatever steps are necessary to keep the system in operation. The affected Company must report to the FERC and post on the internet at “Emergency Postings” each emergency that resulted in any deviation from the Standards of Conduct, within 24 hours after the beginning of such deviation. (Reference FERC Regulation 358.4(a)(1) and (2)).

Emergency operations may require contacts with affiliated generation owners to maintain system reliability. In any such event, the manager of the control center shall be responsible for reporting such contacts to the Chief Compliance Officer, as well as to the communications department, so that a posting at the appropriate Web site under “Emergency Postings” can be made within 24 hours of the deviation from the Standards of Conduct. Each Transmission Control Center shall be responsible for maintaining a log of any deviations from the Standards of Conduct and for transferring updated logs to the Chief Compliance Officer.

Shared Employees

As noted above in the General Principles, the PHI subsidiaries are permitted to share support employees as well as field employees. Support employees include, but are not limited to, legal counsel, financial and accounting services, human resources and information technology and data processing employees. These employees are subject to the “No Conduit Rule” which prohibits them from sharing non-public transmission information or information obtained from transmission customers with any Marketing Employee or Energy Affiliate Employee.

Training

All PHI employees (including contractors, consultants and agents) with access to transmission, energy or market information receive annual training on the FERC Standards of Conduct. ACE, Delmarva and Pepco have implemented an electronic training requirement and designated the employees that must take that training. Senior officers and directors receive annual training from the Chief Compliance Officer.

As part of the initial and annual retraining, a copy of these Procedures will be distributed to the Transmission Employees of ACE, Delmarva and Pepco and the Marketing Employees and Energy Affiliates in the PHI corporate family who have access to information about transmission, energy, power or marketing.

Each employee that receives training shall certify, electronically or in writing, that the employee has received the training.

Any new employee or employee transferring into a transmission function or a Marketing or Energy Affiliate function shall be trained within seven business days after taking such position.

Posting Requirements

Effective September 22, 2004, ACE, Delmarva and Pepco posted their organizational charts and job descriptions at www.conectiv.com and www.pepco.com, respectively), with a link from the PJM OASIS at PJM Company Transmission Provider Information. Transmission service over ACE, Delmarva and Pepco transmission facilities is provided pursuant to the PJM Open Access Transmission Tariff (PJM Tariff).

Also posted are the names and addresses of Marketing and Energy Affiliates, a list of shared facilities and these written Procedures for implementing the Standards of Conduct. Please see the Web sites noted above for these postings. Posting of any deviations from the Standards of Conduct in emergency situations, potential merger partners as affiliates, inadvertent disclosures of information that should not have been disclosed under the FERC Standards of Conduct, voluntary consent by a transmission customer for the Transmission Provider to share the customer’s information with an affiliate, and any discount offerings for transmission services shall be posted immediately on the Web sites.

Pursuant to the HR Procedure on FERC Standards of Conduct, all managers responsible for Transmission Employees shall inform HR of transfers of employees between Transmission functions, on the one hand, and Marketing functions or an Energy Affiliate, on the other hand, not less than two days before the transfer will take place. The manager shall make the appropriate report to the Client Services department for posting at the appropriate Web site. See HR Procedure for FERC Standards of Conduct (Attachment A). The information to be posted must include: the name of the transferring employee, the respective titles held while performing each function (i.e. on behalf of the Transmission Provider, Marketing or Energy Affiliate), and the effective date of the transfer. The information posted under this section must be posted for 90 days.

All changes to posted corporate organizational charts and charts showing Transmission, Marketing and Energy Affiliate organization, job descriptions and names must occur not more than seven business days after the change.

Document Control, Security and Retention
Transmission Employees in the transmission services division keep all files containing transmission information, other than transmission information which is contemporaneously available without restriction to other members of the general public (e.g., published reports), in locked offices, locked file cabinets or password-protected computer files.

Pepco’s, ACE’s and Delmarva’s marketing and Energy Affiliate employees do not have access to the energy management systems (EMS). Systems operations personnel provides system generation data needed for retail access billing settlements, extracted from the EMS to a firewall-protected archival database under the control of system operations personnel. Access to this archival database is password-protected, and for each password, access is limited to the level authorized by the transmission system operations personnel database manager.

Marketing and Energy Affiliate employees are denied access to any transmission system operations information.

PHI Energy Affiliates may be authorized access to economic dispatch data from PJM and certain Energy Affiliate owned generation, connected to the Pepco, ACE or Delmarva systems metered by the EMS. With proper password authorization, this access is provided through the applicable company LAN. One Energy Affiliate has arranged for this service under contract. Any third party that is similarly situated to the PHI Energy Affiliates, as described above, and that desires to use the EMS as its real-time metering agent may arrange to do so on the same basis as the PHI Energy Affiliate.

Discounts

Any offer of a discount for any transmission service made by the Transmission Provider must be posted on the PJM OASIS contemporaneous with the time that the offer is contractually binding. The posting must include: the name of the customer involved in the discount and whether it is an affiliate or whether an affiliate is involved in the transaction, the rate offered; the maximum rate; the time period for which the discount would apply; the quantity of power or gas scheduled to be moved; the delivery points under the transaction; and any conditions or requirements applicable to the discount. The posting must remain on the PJM OASIS for 60 days from the date of posting. (Reference FERC Regulation 358.5(d).)

The Companies do not take any actions with respect to discounts for transmission service. PJM is responsible for discounts of transmission service.

Part 358 — Standards of Conduct

§358.1 Applicability.

  1. This part applies to any interstate natural gas pipeline that transports gas for others pursuant to subpart A of part 157 or subparts B or G of part 284 of this chapter.

  2. This part applies to any public utility that owns, operates, or controls facilities used for the transmission of electric energy in interstate commerce.

  3. This part does not apply to a public utility Transmission Provider that is a Commission-approved Independent System Operator (ISO) or Regional Transmission Organization (RTO). If a public utility transmission owner participates in a Commission-approved ISO or RTO and does not operate or control its transmission facilities and has no access to transmission, customer or market information covered by §385.5(b), it may request an exemption from this part.

  4. A Transmission Provider may file a request for an exemption from all or some of the requirements of this part for good cause.

§ 358.2 General Principles.

  1. A Transmission Provider’s employees engaged in transmission system operations must function independent from employees of its Marketing and Energy Affiliates.

  2. A Transmission Provider must treat all transmission customers, affiliated and non-affiliated, on a non-discriminatory basis, and must not operate its transmission system to preferentially benefit its Marketing or Energy Affiliates.

§ 358.3 Definitions.

  1. Transmission Provider means:

    1. Any public utility that owns, operates or controls facilities used for the transmission of electric energy in interstate commerce; or

    2. Any interstate natural gas pipeline that transports gas for others pursuant to subpart A of part 157 or subparts B or G of part 284 of this chapter.

    3. A Transmission Provider does not include a natural gas storage provider authorized to charge market-based rates that is not interconnected with the jurisdictional facilities of any affiliated interstate natural gas pipeline, has no exclusive franchise area, no captive ratepayers and no market power.

  2. Affiliate means:

    1. Another person which controls, is controlled by or is under common control with, such person. An Affiliate includes a division that operates as a functional unit, and

    2. For any exempt wholesale generator, as defined under section 32(a) of the Public Utility Holding Company Act of 1935, as amended, the same as provided in section 214 of the Federal Power Act.

  3. Control (including the terms “controlling,” “controlled by” and “under common control with”) as used in this part and § 250.16 of this chapter, includes, but is not limited to, the possession, directly or indirectly and whether acting alone or in conjunction with others, of the authority to direct or cause the direction of the management or policies of a company. A voting interest of 10 percent or more creates a rebuttable presumption of control.

  4. Energy Affiliate means an affiliate of a Transmission Provider that:

    1. Engages in or is involved in transmission transactions in U.S. energy or transmission markets; or

    2. Manages or controls transmission capacity of a Transmission Provider in U.S. energy or transmission markets; or

    3. Buys, sells trades or administers natural gas or electric energy in U.S. energy or transmission markets; or

    4. Engages in financial transactions relating to the sale or transmission of natural gas or electric energy in U.S. energy or transmission markets.

    5. An LDC division of an electric public utility Transmission Provider shall be considered the functional equivalent of an Energy Affiliate, unless it qualifies for the exemption in § 358.3(d)(6)(v).

    6. An Energy Affiliate does not include:

      1. A foreign affiliate that does not participate in U.S. energy markets;
      2. An affiliated Transmission Provider or an interconnected foreign affiliated natural gas pipeline that is engaged in natural gas transmission activities which are regulated by the state, provincial or national regulatory boards of the foreign country in which such facilities are located;
      3. A holding, parent or service company that does not engage in energy or natural gas commodity markets or is not involved in transmission transactions in U.S. energy markets;
      4. An affiliate that purchases natural gas or energy solely for its own consumption. “Solely for its own consumption” does not include the purchase of natural gas or energy for the subsequent generation of electricity;
      5. A State-regulated local distribution company that acquires interstate transmission capacity to purchase and resell gas only for on-system sales, and otherwise does not engage in the activities described in §§ 358.3(d)(1), (2), (3) or (4), except to the limited extent necessary to support on-system sales and to engage in de minimus sales necessary to remaining in balance under applicable pipeline tariff requirements./li>
      6. A producer, gatherer, Hinshaw pipeline or an intrastate pipeline that makes incidental purchases or sales of de minimus volumes of natural gas to remain in balance under applicable pipeline tariff requirements and otherwise does not engage in the activities described in §§358.3(d)(1), (2), (3) or (4).
  5. Marketing, sales or brokering means a sale for resale of natural gas or electric energy in interstate commerce. Sales and marketing employee or unit includes:

    1. An interstate natural gas pipeline’s sales operating unit, to the extent provided in § 284.286 of this chapter, and

    2. A public utility Transmission Provider’s energy sales unit, unless such unit engages solely in bundled retail sales.

    3. Marketing or sales does not include incidental purchases or sales of natural gas to operate interstate natural gas pipeline transmission facilities.

  6. Transmission means natural gas transportation, storage, exchange, backhaul, or displacement service provided pursuant to subpart A of part 157 or subparts B or G of part 284 of this chapter; and electric transmission, network or point-to-point service, reliability service, ancillary services or other methods of transportation or the interconnection with jurisdictional transmission facilities.

  7. Transmission Customer means any eligible customer, shipper or designated agent that can or does execute a transmission service agreement or can or does receive transmission service, including all persons who have pending requests for transmission service or for information regarding transmission.

  8. Open Access Same-time Information System or OASIS refers to the Internet location where a public utility posts the information, by electric means, required by part 37 of this chapter.

  9. Internet Web site refers to the Internet location where an interstate natural gas pipeline posts the information, by electronic means, required by §§ 284.12 and 284.13 of this chapter.

  10. Transmission Function employee means an employee, contractor, consultant or agent of a Transmission Provider who conducts transmission system operations or reliability functions, including, but not limited to, those who are engaged in day-to-day duties and responsibilities for planning, directing, organizing or carrying out transmission-related operations.

  11. Marketing Affiliate means an Affiliate as that term is defined in § 358.3(b) or a unit that engages in marketing, sales or brokering activities as those terms are defined at § 358.3(e).

§ 358.4 Independent Functioning.

  1. Separation of functions.

    1. Except in emergency circumstances affecting system reliability, the transmission function employees of the Transmission Provider must function independently of the Transmission Provider’s Marketing or Energy Affiliates’ employees.

    2. Notwithstanding any other provisions in this section, in emergency circumstances affecting system reliability, a Transmission Provider may take whatever steps are necessary to keep the system in operation. Transmission Providers must report to the Commission and post on the OASIS or Internet Web site, as applicable, each emergency that resulted in any deviation from the standards of conduct, within 24 hours of such deviation.

    3. The Transmission Provider is prohibited from permitting the employees of its Marketing or Energy Affiliates from:

      1. Conducting transmission system operations or reliability functions; and
      2. Having access to the system control center or similar facilities used for transmission operations or reliability functions that differs in any way from the access available to other transmission customers.
    4. Transmission Providers are permitted to share support employees and field and maintenance employees with their Marketing and Energy Affiliates.

    5. Transmission Providers are permitted to share with their Marketing or Energy Affiliates senior officers and directors who are not “Transmission Function Employees” as that term is defined in § 358.3(j). A Transmission Provider may share transmission information covered by §§ 385.5(a) and (b) with its shared senior officers and directors provided that they do not: participate in directing, organizing or executing transmission system operations or marketing functions; or act as a conduit to share such information with a Marketing or Energy Affiliate.

    6. Transmission Providers are permitted to share risk management employees that are not engaged in Transmission Functions or sales or commodity Functions with their Marketing and Energy Affiliates.

  2. Identifying affiliates on the public Internet.

    1. A Transmission Provider must post the names and addresses of Marketing and Energy Affiliates on its OASIS or Internet Web site.

    2. A Transmission Provider must post on its OASIS or Internet Web site, as applicable, a complete list of the facilities shared by the Transmission Provider and its Marketing and Energy Affiliates, including the types of facilities shared and their addresses.

    3. A Transmission Provider must post comprehensive organizational charts showing:

      1. The organizational structure of the parent corporation with the relative position in the corporate structure of the Transmission Provider, Marketing and Energy Affiliates;
      2. For the Transmission Provider, the business units, job titles and descriptions, and chain of command for all positions, including officers and directors, with the exception of clerical maintenance and field positions. The job titles and descriptions must include the employee’s title, the employee’s duties, whether the employee is involved in transmission or sales, and the name of the supervisory employees who manage non-clerical employees involved in transmission or sales.
      3. For all employees who are engaged in transmission functions for the Transmission Provider and marketing or sales functions or who are engaged in transmission functions for the Transmission Provider and are employed by any of the Energy Affiliates, the Transmission Provider must post the name of the business unit within the marketing or sales unit or the Energy Affiliate, the organizational structure in which the employee is located, the employee’s name, job title and job description in the marketing or sales unit or Energy Affiliate, and the employee’s position within the chain of command of the Marketing or Energy Affiliate.
      4. The Transmission Provider must update the information on its OASIS or Internet Web site, as applicable, required by §§ 358.4(b)(1), (2) and (3) within seven business days of any change, and post the date on which the information was updated.
      5. The Transmission Provider must post information concerning potential merger partners as affiliates within seven days after the potential merger is announced.
      6. All OASIS or Internet Web site postings required by part 358 must comply, as applicable, with the requirements of § 37.3 or §§ 284.12(a) and (c)(3)(v) of this chapter.
  3. Transfers. Employees of the Transmission Provider, Marketing or Energy Affiliates are not precluded from transferring among such functions as long as such transfer is not used as a means to circumvent the Standards of Conduct. Notices of any employee transfers between the Transmission Provider, on the one hand, and the Marketing or Energy Affiliate, on the other, must be posted on the OASIS or Internet Web site, as applicable. The Information to be posted must include: the name of the transferring employee, the respective titles held while performing each function (i.e., on behalf of the Transmission Provider, Marketing or Energy Affiliate), and the effective date of the transfer. The information posted under this section must remain on the OASIS or Internet Web site, as applicable, for 90 days.

  4. Books and records. A Transmission Provider must maintain its books of account and records (as prescribed under parts 101, 125, 201 and 225 of this chapter) separately from those of its Energy Affiliates and these must be available for Commission inspections.

  5. Written procedures.

    1. By February 9, 2004, each Transmission Provider is required to file with the Commission and post on the OASIS or Internet Web site a plan and schedule for implementing the standards of conduct.

    2. Each Transmission Provider must be in full compliance with the standards of conduct by September 22, 2004.

    3. The Transmission Provider must post on the OASIS or Internet Web site, current written procedures implementing the standards of conduct in such detail as will enable customers and the Commission to determine that the Transmission Provider is in compliance with the requirements of this section by September 22, 2004 or within 30 days of becoming subject to the requirements of part 358.

    4. Transmission Providers will distribute the written procedures to all Transmission Provider employees and employees of the Marketing and Energy Affiliates.

    5. Transmission Providers shall train officers and directors as well as employees with access to transmission information or information concerning gas or electric purchases, sales or marketing functions. The Transmission Provider shall require each employee to sign a document or certify electronically signifying that s/he has participated in the training.

    6. Transmission Providers are required to designate a Chief Compliance Officer who will be responsible for standards of conduct compliance.

§ 358.5 Non-discrimination requirements.

  1. Information access.

    1. The Transmission Provider must ensure that any employee of Marketing or Energy Affiliate may only have access to that information available to the Transmission Provider’s transmission customers (i.e., the information posted on the OASIS or Internet Web site, as applicable), and must not have access to any information about the Transmission Provider’s transmission system that is not available to all users of an OASIS or Internet Web site, as applicable.

    2. The Transmission Provider must ensure that any employee of the Marketing or Energy Affiliate is prohibited from obtaining information about the Transmission Provider’s transmission system (including, but not limited to, information about available transmission capability, price, curtailments, storage, ancillary services, balancing, maintenance activity, capacity expansion plans or similar information) through access to information not posted on the OASIS or Internet Web site or that is not otherwise also available to the general public without restriction.

  2. Prohibited disclosure.

    1. An employee of the Transmission Provider may not disclose to its Marketing or Energy Affiliates any information concerning the transmission systems of the Transmission Provider or the transmission system of another (including, but not limited to, information received from non-affiliates or information about available transmission capability, price, curtailments, storage, ancillary services, balancing, maintenance activity, capacity expansion plans, or similar information) through non-public communications conducted off the OASIS or Internet Web site, through access to information not posted on the OASIS or Internet Web site that is not contemporaneously available to the public, or through information on the OASIS or Internet Web site that is not at the same time publicly available.

    2. A Transmission Provider may not share any information, acquired from non-affiliated transmission customers or potential non-affiliated transmission customers, or developed in the course of responding to requests for transmission or ancillary service on the OASIS or Internet Web site, with employees of its Marketing or Energy Affiliates, except to the limited extent information is required to be posted on the OASIS or Internet Web site in response to a request for transmission service or ancillary services.

    3. If an employee of the Transmission Provider discloses information in a manner contrary to the requirements of §§ 358.5(b)(1) and (2), the Transmission Provider must immediately post such information on the OASIS or Internet Web site.

    4. A non-affiliated transmission customer may voluntarily consent, in writing, to allow the Transmission Provider to share the non-affiliated customer’s information with a Marketing or Energy Affiliate. If a non-affiliated customer authorizes the Transmission Provider to share its information with a Marketing or Energy Affiliate, the Transmission Provider must post notice on the OASIS or Internet Web site of that consent along with a statement that it did not provide any preferences, either operational or rate-related, in exchange for that voluntary consent.

    5. A Transmission Provider is not required to contemporaneously disclose to all transmission customers or potential transmission customers information covered by § 358.5(b)(1) if it relates solely to a Marketing or Energy Affiliate’s specific request for transmission service.

    6. A Transmission Provider may share generation information necessary to perform generation dispatch with its Marketing and Energy Affiliate that does not include specific information about individual third party transmission transactions or potential transmission arrangements.

    7. Neither a Transmission Provider nor an employee of a Transmission Provider is permitted to use anyone as a conduit for sharing information covered by the prohibitions of §§ 358.5(b)(1) and (2) with a Marketing or Energy Affiliate. A Transmission Provider may share information covered by §§ 358.5(b)(1) and (2) with employees permitted to be shared under §§ 358.4(a)(4), (5) and (6) provided that such employees do not act as a conduit to share such information with any Marketing or Energy Affiliates.

    8. A Transmission Provider is permitted to share information necessary to maintain the operations of the transmission system with its Energy Affiliates.

  3. Implementing tariffs.

    1. A Transmission Provider must strictly enforce all tariff provisions relating to the sale or purchase of open access transmission service, if these tariff provisions do not permit the use of discretion.

    2. A Transmission Provider must apply all tariff provisions relating to the sale or purchase of open access transmission service in a fair and impartial manner that treats all transmission customers in a non-discriminatory manner, if these tariff provisions permit the use of discretion.

    3. A Transmission Provider must process all similar requests for transmission in the same manner and within the same period of time.

    4. The Transmission Provider must maintain a written log, available for Commission audit, detailing the circumstances and manner in which it exercised its discretion under any terms of the tariff. The information contained in this log is to be posted on the OASIS or Internet Web site within 24 hours of when a Transmission Provider exercises its discretion under any terms of the tariff.

    5. The Transmission Provider may not, through its tariffs or otherwise, give preference to its Marketing or Energy Affiliate, over any other wholesale customer in matters relating to the sale or purchase of transmission service (including, but not limited to, issues of price, curtailments, scheduling, priority, ancillary services, or balancing).

  4. Discounts.

    Any other of a discount for any transmission service made by the Transmission Provider must be posted on the OASIS or Internet Web site contemporaneously with the time that the offer is contractually binding. The posting must include: the name of the customer involved in the discount and whether it is an affiliate or whether an affiliate is involved in the transaction, the rate offered; the maximum rate; the time period for which the discount would apply; the quantity of power or gas scheduled to be moved; the delivery points under the transaction; and any conditions or requirements applicable to the discount. The posting must remain on the OASIS or Internet Web site for 60 days from the date of posting.

Standards of Conduct FERC Order 2004 and 2004-A HR Procedure

Purpose:

The purpose of this document is to provide a guide for all PHI Managers on how to comply with FERC Order 2004 and 2004-A. The order requires PHI to keep a record of any Transmission Function or Energy Affiliate employee. A Transmission Function employee is defined as “an employee, contractor, consultant or agent of a Transmission Provider who conducts transmission system operations or reliability functions, including, but not limited to, those who are engaged in day-to-day duties and responsibilities for planning, directing, organizing or carrying out transmission-related operations.” “Energy Affiliate” includes not only affiliates actively engaged in energy trading but also internal utility or service company groups and departments that buy, sell, trade or administer natural gas or electric energy in U.S. Energy or transmission markets.

Procedure:

In order to comply with Standards of Conduct FERC Order 2004 and 2004-A, all affected Managers must identify all employees and/or positions designated as performing a Transmission or Marketing and Sales (Internal Merchant) function. All affected Managers must complete a Change of Status form (COS) within two (2) days of any employee movement into or out of a relevant department. The form must be submitted to an HR Business Partner within those two (2) days. COS forms include the Position Information form, the New Hire/Rehire form, and the Transfer/Promotion/Job-Re-class/Data Change form.

For your convenience, the COS forms are available via the PHI Intranet in the Human Resources section, under the Forms heading.

The Managers are responsible for submitting the completed forms to the Business Partners in a timely manner. It is not the Business Partners responsibility to complete the COS forms. However, the Business Partners are responsible for verifying the information provided by the Managers and for making sure that the HR Client Services team gets the completed forms for SAP input within the required time (is this the two days as stated above). Also, the Business Partners will provide assistance with any questions related to completing the forms.