Articles Posted in Utilities Law

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AOPL petitioned for review of FERC's issuance of an order adopting the index formula to govern oil pipeline rates for the 2016 to 2021 period. The DC Circuit denied the petition for review, holding that there was no merit to AOPL's claim that FERC impermissibly relied solely on the middle 50 percent of pipeline cost-change data and failed to incorporate the middle 80 percent of cost-change data, and that FERC impermissibly used "Page 700" cost-of-service data to calculate the index level. The court held that the record makes it plain that the Commission adequately and reasonably explained its decision not to consider the middle 80 percent of pipelines' cost-change data; nothing in any of FERC's past index review orders bound the agency to use the middle 80 percent of pipelines' cost-change data; the Commission's rationale for utilizing the cost-of-service data from Page 700 was clear and reasonable; and there was nothing in the record to support AOPL's claim that FERC's decision to use Page 700 data indicates an unexplained shift in its measurement objective. View "Association of Oil Pipe Lines v. FERC" on Justia Law

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SPP, a regional transmission organization (RTO), filed with FERC revisions to its tariff that reflected an agreement with Integrated System entities to integrate their facilities. Pursuant to the requirements of section 205 of the Federal Power Act, 16 U.S.C. 824d, SPP filed with FERC revisions to its tariff that reflected the parties' agreement. FERC approved the revisions over the objections of Kansas. The DC Circuit denied Kansas' petition for review, holding that FERC accurately described the agreement as reciprocal; Kansas misread various precedents and the court rejected its contention that the arrangement violated critical norms of ratemaking; the court saw no basis for a claim of undue discrimination; and the court rejected Kansas' arguments regarding SPP's reliance on a study commissioned by the IS Parties. Finally, FERC did not abuse its discretion by deciding not to hold an evidentiary hearing on the disputed features of the record underlying its approval of the merger. View "State Corp. Commission of KS v. FERC" on Justia Law

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This case involves the allocation of production costs among the Entergy Operation Companies. LPSC petitioned for review of FERC's implementation of its decision to delay the effective date of the Bandwidth Remedy. The DC Circuit denied LPSC's petition with respect to FERC's advancement of the effective date to the 2005 period, and denied its petition as to the application of the Bandwidth Remedy to the 2005 period. The court granted FERC's request to remand to FERC for further consideration of the denial of Section 206 refunds for the September 2001-May 2003 effective period. View "Louisiana Public Service Commission v. FERC" on Justia Law

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Orangeburg challenged the Commission's approval of an agreement between two utilities, alleging that the approval constituted an authorization of the North Carolina Utilities Commission's (NCUC) unlawful regime. The DC Circuit held that Orangeburg has standing to challenge the Commission's approval because, among other reasons, the city has demonstrated an imminent loss of the opportunity to purchase a desired product (reliable and low-cost wholesale power), and because that injury was fairly traceable to the Commission's approval of the agreement at issue. On the merits, the court held that the Commission failed to justify its approval of the agreement's disparate treatment of wholesale ratepayers; to justify the disparity, the Commission relied exclusively on one line from a previous FERC order that, without additional explication, appeared either unresponsive or legally unsound. Accordingly, the court vacated in part the orders approving the agreement and denying rehearing, and remanded. View "Orangeburg, South Carolina v. FERC" on Justia Law

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Section 205 of the Federal Power Act does not allow FERC to make modifications to a proposal that transform the proposal into an entirely new rate of FERC's own making. Electricity generators petitioned for review of FERC's decision modifying PJM's proposed changes to its rate structure. FERC's modifications created a new rate scheme that was significantly different from PJM's proposal and from PJM's prior rate design. The D.C. Circuit held that FERC contravened the limitation on its Section 205 authority. Therefore, the court granted the petitions for review and vacated FERC's orders with respect to several aspects of PJM's proposed rate structure -- the self-supply exemption, the competitive entry exemption, unit-specific review, and the mitigation period. The court remanded to FERC. View "NRG Power Marketing, LLC v. FERC" on Justia Law

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The Commission determined that Florida Power overcharged Seminole for electricity and ordered a refund. Seminole petitioned for review, claiming that it was entitled to a larger refund. The DC Circuit denied the petition for review, holding that the Commission correctly concluded that the service agreement required Seminole to make any challenge to a bill within 24 months of receiving that bill, and thus limited Florida Power's refund liability. The court also held that, in the face of ambiguity, the Commission reasonably concluded that the tariff allowed transmission providers to use non-apportionment. View "Seminole Electric Cooperative v. FERC" on Justia Law

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LPSC petitioned for review of FERC's rejection of LPSC's request to reform certain depreciation rates. The DC Circuit denied the petition for review and rejected LPSC's claim that FERC failed to confront its asserted evidence of undue discrimination where FERC fulfilled such obligations; FERC precedent did not require the use of FERC's own depreciation standards; and there has been no unlawful subdelegation because FERC has exercised, and intends to continue to exercise, its authority. View "Louisiana Public Service Commission v. FERC" on Justia Law

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Petitioners challenged the Commissions' approval of revisions to the rules governing the buying and selling of "capacity" for markets operated by PJM. The DC Circuit held that the Commission balanced the benefits of the revised rules against the increased costs and reached a reasoned judgment. Therefore, the Commission's decision was not arbitrary nor capricious. The court deferred to the Commission's interpretation of the Federal Power Act, 16 U.S.C. 824e, because its interpretation of the Act's requirements was reasonable; deferred to the Commission's balancing of competing concerns in setting a penalty rate; and rejected challenges to the default offer cap, the year-round capacity commitment, orders approving PJM's demand resource rules, and imposition of Capacity Performance penalties on resources that fail to perform due to unit-specific constraints. Accordingly, the court denied the petitions for review. View "Advanced Energy Management Alliance v. FERC" on Justia Law

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Section 309 of the Federal Power Act (FPA), 16 U.S.C. 825h, vests the Commission with broad remedial authority, including the authority to grant recoupment when it is justified; Section 201(f) does not limit the authority of the Commission to grant relief under Section 309 with respect to matters that are beyond the strictures of Sections 201(f) and 205; and an order of recoupment, as distinguished from an order to refund under Section 205, is beyond the strictures of Sections 201(f) and 205. In this case, Chehalis sought relief from the Commission by filing a Motion for an Order Requiring Recoupment of Payments, but the Commission concluded that it could not order recoupment because the Commission's refund authority does not extend to exempt public utilities such as the Intervenor Bonneville. The DC Circuit held that the Commission erred when it held that it lacked the authority to grant the Order Requiring Recoupment where the Commission clearly had jurisdiction over the subject of this dispute and the Commission retained the authority to order Bonneville to return the funds when the agency acknowledged that its initial order was mistaken. The court granted in part and denied in part Chehalis's petitions for review, and remanded for further proceedings. View "TNA Merchant Projects v. FERC" on Justia Law

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Section 210 of the Public Utility Regulatory Policies Act of 1978 (PURPA), 16 U.S.C. 824a-3, seeks to reduce reliance on fossil fuels by increasing the number of energy-efficient cogeneration and small power-production facilities. Oregon implements its PURPA responsibilities largely through its Public Utility Commission (OPUC), which has directed utilities subject to its jurisdiction to draft off-the-shelf, standard-form power-purchase agreements that OPUC then reviews for compliance with PURPA. OPUC has approved two standard-form power-purchase agreements submitted by petitioner Portland General Electric. Petitioner PáTu Wind Farm, a six-turbine, nine-megawatt generator in rural Oregon, is classified under PURPA as a small power producer. This appeal stems from the parties' dispute over the nature of Portland General's purchase obligation. The Commission ruled that under PURPA, Portland General must purchase all of PáTu’s power, though it rejected PáTu’s insistence that Portland General do so by utilizing a technology known as dynamic scheduling. The court concluded that PáTu’s petition dealing exclusively with Portland's refusal to utilize dynamic scheduling is without merit. Accordingly, the court denied PáTu’s petition. The court dismissed Portland's petition challenging the Commission's ruling that it must purchase all of PáTu’s power for lack of jurisdiction because FERC's orders were advisory. View "Portland General Electric Comp v. FERC" on Justia Law