Stoel Rives attorney Jennifer Mersing authored an article for Law360 titled “Promoting Renewable Energy After Hughes V. Talen Energy” and was quoted in UtilityDive in an article titled “What the Hughes v. Talen Supreme Court decision means for state power incentives.” The articles discuss the recent U.S. Supreme Court decision in which the court sought to clarify the boundary between federal and state authority under the Federal Power Act.
The case arose after regulators in Maryland solicited offers for new power generation capacity, selecting Competitive Power Ventures (CPV) to construct a new 650 MW gas-fired plant. Maryland’s contract with CPV guaranteed a set capacity rate and directed the company to bid the capacity into the PJM Interconnection (PJM) auction, with load-serving entities in the state making up the difference if the clearing price for the PJM auction was lower than the contract price.
The Supreme Court upheld the Fourth Circuit and found Maryland’s program to be preempted, finding that the program disregarded an interstate wholesale rate required by FERC and crossed into FERC’s mandate to regulate interstate power markets like the one operated by PJM.
Justice Ruth Bader Ginsburg, who delivered the opinion of the Court, stressed in the decision that it is a ruling on the program in Maryland only—a comfort to advocates of renewable energy, according to Mersing. “The renewables community was concerned the Supreme Court might return a broad, open-ended decision that might be seen as limiting the ability of states to take actions to promote generation,” she said. “But the court went out of its way to decide the case on very narrow grounds. … I don't see renewable programs under threat.”
Read “Promoting Renewable Energy After Hughes V. Talen Energy,” published by Law360, April 22, 2016 (Subscription only); and “What the Hughes v. Talen Supreme Court decision means for state power incentives,” published by UtilityDive, April 25, 2016.