Articles Posted in Utilities Law

by
The DC Circuit denied Duke's petition for review of the Commission's denial of Duke's complaint against PJM under the Federal Power Act (FPA), 16 U.S.C. 825e. To prepare for a bitterly cold day during the January 2014 polar vortex, Duke purchased expensive natural gas which it ended up not needing. Duke then claimed that PJM, its regional transmission organization, directed it to purchase the gas and that the governing tariff provided for indemnification. The court held that the Commission's finding that PJM never directed Duke to buy gas was supported by substantial evidence on the record. Therefore, the court had no need to address Duke's remaining argument that, had such a directive been issued, the tariff would have authorized indemnification. View "Duke Energy Corp. v. FERC" on Justia Law

by
After Old Dominion found that its operational costs during the January 2014 polar vortex outstripped the amounts it could charge for electricity under the governing tariff, it asked the Commission to waive provisions of the governing tariff retroactively so that it could recover its costs. The DC Circuit denied Old Dominion's petition for review of the Commission's denial of Old Dominion's request based on the ground that such retroactive charges would violate the filed rate doctrine and the rule against retroactive ratemaking. In this case, the court afforded the Commission's interpretation of the filed tariff and the PJM Operating Agreement substantial deference where there was no dispute that the PJM Tariff's filed rate did not allow the cost recovery that Old Dominion sought. The court also denied the motion of Independent Market Monitor to intervene, but accorded it amicus curiae status. View "Old Dominion Electric Cooperative v. FERC" on Justia Law

by
The DC Circuit denied the Arkansas Commission's petition for review of a final FERC order. The FERC order held that an operating company withdrawing from a multi-state energy system must continue to share the proceeds of a pre-departure settlement with the other member companies. The court held that FERC had a lawful basis to order the sharing of the benefits of the settlement and was reasoned in its allocation methodology. Therefore, FERC's order for Entergy Arkansas to share the Union Pacific Settlement benefits and its method for allocating the settlement was not arbitrary, capricious, or contrary to law. View "Arkansas Public Service Comm. v. FERC" on Justia Law

by
The DC Circuit granted a petition for review of FERC's assertion of Natural Gas Act (NGA) jurisdiction over the transportation and sale of natural gas for resale from the City of Clarksville, Tennessee to the City of Guthrie, Kentucky. As a preliminary matter, the court rejected FERC's standing and ripeness challenges to the court's authority to hear the petition for review. On the merits, the court saw no reason to deviate from the clear and unambiguous language of the statute, as well as FERC precedent, and held that Clarksville was a municipality that was exempt from regulation under NGA Section 7. The court also rejected FERC's alternative argument and held that the articulation of the scope of FERC's jurisdiction did not mean that Congress gave FERC jurisdiction over everything within the three areas listed by FERC. Therefore, the court vacated FERC's order. View "City of Clarksville, Tennessee v. FERC" on Justia Law

by
NorthWestern challenged FERC's determination that its proposed rate was not just and reasonable. The DC Circuit held that FERC's decision in this case was reasonable and reasonably explained where FERC reasonably modified NorthWestern's proposed cost-calculation ratio by excluding the megawatts associated with "regulation down" from the numerator; FERC did not arbitrarily increase the denominator of NorthWestern's proposed cost-calculation ratio; FERC's decision on fuel costs was reasonable and reasonably explained; and FERC acted reasonably by requiring NorthWestern to make separate Section 205 filings. The court also held that FERC properly decided to treat this case like an ordinary over-collection case and ordered a refund. Therefore, the court denied the petition for review. View "NorthWestern Corp. v. FERC" on Justia Law

by
The DC Circuit dismissed KCC's petition for review, holding that KCC has not suffered an injury in fact sufficient to establish standing. KCC asserted that the Commission acted unlawfully by approving formula rates—which help determine the electric rates charged by public utilities to consumers in FERC jurisdictions—for future public utilities to use in operating electric transmission facilities. The court held that KCC failed to affirmatively demonstrate how it was adversely affected by the FERC's order and there was no substantial probability that the harms KCC identified would occur. View "Kansas Corporation Commission v. FERC" on Justia Law

by
Petitioners challenged four FERC orders that uphold the current iteration of the Tariff that governs electricity rates in New England. The Tariff, a patchwork of rules and orders adopted by the Independent System Operator of New England (ISO-NE) and approved by FERC, governs how Forward Capacity Market participants buy and sell future capacity. The DC Circuit granted the petitions for review, holding that FERC failed to offer adequate rationale and explanation in the challenged orders. In this case, FERC failed to respond to the substantial arguments put forward by petitioners and failed to square its decision with its past precedent. Accordingly, the court remanded for further proceedings. View "New England Power Generators Association, Inc. v. FERC" on Justia Law

by
The DC Circuit denied petitions for review challenging FERC's orders approving PJM's tariff that determined the rates paid to energy providers for providing electric capacity in the broad mid-Atlantic region. Petitioners argued that FERC lacked substantial evidence to approve the estimates of labor costs that formed part of the calculation of the cost of new entry; FERC should have accepted the labor-cost calculations of petitioners' expert; and FERC erred in approving another input to the estimated cost of new entry. The court held that petitioners' objections failed to undermine the substantial evidence supporting FERC's figure for the cost of new entry and failed to overcome the court's deferential standard of review. View "PJM Power Providers Group v. FERC" on Justia Law

by
The DC Circuit denied petitions for review challenging FERC's orders approving PJM's tariff that determined the rates paid to energy providers for providing electric capacity in the broad mid-Atlantic region. Petitioners argued that FERC lacked substantial evidence to approve the estimates of labor costs that formed part of the calculation of the cost of new entry; FERC should have accepted the labor-cost calculations of petitioners' expert; and FERC erred in approving another input to the estimated cost of new entry. The court held that petitioners' objections failed to undermine the substantial evidence supporting FERC's figure for the cost of new entry and failed to overcome the court's deferential standard of review. View "PJM Power Providers Group v. FERC" on Justia Law

by
FERC issued a series of orders empowering incoming generators within the Midcontinent Independent System Operator (MISO) region to elect to self-fund this new construction, or to seek financing from third parties, regardless of whether the current grid owners wish to fund the construction themselves. The DC Circuit vacated the orders, holding that there was neither evidence nor economic logic supporting FERC's discriminatory theory as applied to transmission owners without affiliated generation assets. The court also held that FERC did not adequately respond to petitioners' argument that involuntary generator funding compelled them to construct, own, and operate facilities without compensatory network upgrade charges – thus forcing them to accept additional risk without corresponding return as essentially non-profit managers of these upgrade facilities. Accordingly, the court remanded for further proceedings. View "Ameren Services Co. v. FERC" on Justia Law