-----Original Message-----
From: Holt, Rob [mailto:Rob.Holt@nreca.coop]
Sent: Friday, January 20, 2012 12:51 PM
To: Holt, Rob
Subject: Glenn English - A Few Things (January 12)

MEMORANDUM

January 20, 2012

TO:      Statewide Managers
G&T Managers
NRECA Board of Directors

FROM:            Glenn English, Chief Executive Officer

A few things I wanted to share with you...

The 239-176 House vote for a resolution opposing Administration plans to
raise the debt ceiling $1.2 trillion grabbed headlines this week because it
happened in a vacuum of legislative action.  However, this vote was a
largely symbolic vote because the Budget Control Act passed by Congress last
August already gave the president the authority to raise the debt ceiling if
Congress does not act to do so.  Therefore, this resolution is unlikely to
pass the Senate.  House Republicans used this vote to highlight election
themes on deficit reduction and government spending.

This symbolic vote is the first of many expected this Congress as
Republicans and Democrats push message bills to draw contrasts for voters.
With Congress facing historically-low approval ratings as the President's
ratings have improved, Republican Party leaders want to demonstrate unity on
their agenda for job creation, deficit reduction, tax policy and burdensome
regulation.  Democratic leaders have discussed jobs and economic proposals
that include clean energy and infrastructure investment.

While both parties are posturing around energy, and we expect the President
to include an energy theme in his State of the Union Address next Tuesday,
the general air of partisanship makes it hard to envision the enactment of
any significant energy legislation this year.  The Administration's
announcement that it would reject a key permit for the Keystone XL pipeline
reduces those chances even further.

The legislative pace will pick up next week, when House and Senate conferees
will have their first official negotiating session on a year-long payroll
tax cut extension bill.  The major sticking point is how to pay the $100
billion cost.  We expect Congress to address this issue by the end of
February when the current payroll tax cut expires, though it is also quite
possible we would see Congress enact an additional short-term extension if
it cannot agree on a way of paying for a yearlong extension by February 29.

Environmental Groups will Sue EPA to Force Release of New Coal Ash Rules

An environmental coalition announced plans to sue the Environmental
Protection Agency (EPA) in an attempt to force the agency to expedite a
rulemaking for new regulations on disposal of coal ash.  The groups are
sending EPA a 60-day notice of their intent to file a lawsuit to get a
federal court to impose a deadline on issuing a coal ash rule.  In response
to the Tennessee Valley Authority coal ash spill in December, 2008, EPA
issued a proposed rule in 2009, but has said it does not expect to finish a
new rule until 2013.  In 2000, EPA determined that coal ash is appropriately
regulated as a non-hazardous material, and NRECA has been urging EPA to
ensure that coal ash continues to be regulated as non-hazardous material.
NRECA is also working to get Congress to pass legislation to ensure EPA
regulates coal ash as non-hazardous.  NRECA will review the potential legal
strategies the environmental could pursue and consider the potential options
for electric co-ops to respond.  We will keep you updated in the
developments on this issue.

NRECA Seeks Rehearing on Latest FERC Ruling in Ongoing PURPA Challenge

NRECA has strongly urged the Federal Energy Regulatory Commission (FERC) to
rehear a recent order requiring Midland Power Cooperative to seek FERC
approval before disconnecting operators of a small wind turbine who refused
to pay their retail electric bills.  FERC ruled that it must give approval
before a utility can disconnect a renewable unit operated as qualified
facility under the Public Utility Regulatory Policies Act (PURPA), even if a
state utility commission has approved it.  The American Public Power
Association also submitted a petition supporting NRECA's rehearing request.

NRECA Moves to File Appeal on PJM Capacity Markets Rule

NRECA notified the U.S. Court of Appeals for the Third Circuit that it will
file an appeal of Federal Energy Regulatory Commission (FERC) orders on the
PJM Interconnection and the "minimum offer price rule" that would deny
electric co-ops and other load-serving entities the ability to effectively
and economically use their own resources to meet their own capacity
obligations.  It would also force electric co-ops from long-term planning
and make them more dependent on the short-term centralized markets for
capacity.

Enclosure: (1)  NRECA filing to FERC.

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