A three-judge panel for the D.C. Circuit on April 18 unanimously upheld Order No. 1000, denying multiple challenges by New England power firms and state regulators to the Federal Energy Regulatory Commission’s (FERC’s) controversial mandate that requires utilities to remove certain “right of first refusal” provisions from existing tariffs and agreements.

The decision in Emera Maine, et al v. FERC (15-1139) stems from two petitions that urged the court to review FERC’s July 2011–issued Order No. 1000, which FERC says is designed to remove barriers to development of transmission facilities.

One petition for review was filed by transmission owners participating in ISO-New England (ISO-NE), the regional transmission organization whose tariff governs transmission service and wholesale electric markets in New England. The transmission owners objected to FERC’s determination that the right of first refusal must be removed from the transmission operating agreement between the ISO and the transmission owners.

The second petition was filed by the New England States Committee on Energy on behalf of governmental entities from five of the six states it represents in regional electricity matters: Connecticut, Massachusetts, New Hampshire, Rhode Island, and Vermont. (Maine was not part of the petition.) The state petitioners argued that in its compliance determinations, FERC went beyond Order No. 1000 and altered the balance of responsibility and power between state governments and ISO-NE.

The court cited a number of reasons for denying both petitions, dealing another blow to vigorous opposition to the landmark rule.

The D.C. Circuit in August 2014 upheld the order in a similar case brought by state regulatory commissions, which argued the rule represented an action that exceeded FERC’s statutory authority. But the court rejected the petitioners’ key objection, finding that the transmission planning mandate does not go beyond the bounds of the Federal Power Act by seizing state authority or requiring regional coordination of transmission facilities outside its statutory scope. The decision was widely thought to have resolved any uncertainty about its legality.

Last year, the Seventh Circuit endorsed FERC’s use of the rule, denying challenges from Midcontinent Independent System Operator and independent transmission developer LSP Transmission.

 

Sonal Patel, associate editor (@POWERmagazine, @sonalcpatel)