On October 20, 2022, the U.S. Federal Energy Regulatory Commission (FERC) issued two orders “clarifying” that it will treat a public utility as affiliated with an investing company if the investing company appoints its own officers or directors, or other appointee accountable to the investor (i.e., non-independent), to the board of the public utility or its holding company, regardless of whether the investing company owns, controls, or holds with power to vote, 10% or more of the outstanding voting securities of the specified company.
These FERC orders have important implications for both investors and public utilities subject to FERC regulation, as such director and officer appointments by third-party investors could trigger the need for prior FERC approval, post-appointment notice filings with FERC, and/or other FERC filings.
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