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RTO Insider: DC Circuit Skeptical of NARUC Challenge to FERC Order 841

Posted by Michael Brooks on May 6, 2020

RTO Insider covered D.C. Circuit Court of Appeals skepticism of arguments that FERC exceeded its jurisdiction when it issued Order 841, quoting AEE's Jeff Dennis. Read excerpts below and the entire RTO Insider piece here (sub. req.). 

The D.C. Circuit Court of Appeals seemed unconvinced by arguments that FERC exceeded its jurisdiction by refusing to let states opt out of Order 841, which opened wholesale markets to energy storage.

Representing the National Association of Regulatory Utility Commissioners, Jennifer Murphy argued that FERC had violated provisions of the Federal Power Act that protected states’ authority over their local distribution systems with Order 841. Issued in February 2018, the order directed RTOs and ISOs to revise their tariffs to allow energy storage resources full access to their markets. 

Murphy said NARUC is supportive of the order except for “one small, unnecessary aspect,” in which the commission asserted that states could not prohibit storage resources on the distribution side from selling their power into wholesale markets...

“In our view, at least two of the three judges at the court appeared skeptical of claims brought by petitioners that FERC exceeded its statutory authority,” ClearView Energy Partners said in a memo. “Therefore, we think the court may uphold the provision, either by rejecting petitioners’ standing or by affirming the provision as within the commission’s exclusive jurisdiction.” Even if the court agreed with the petitioners, ClearView said, “we do not expect a disruptive change to the opportunities for [storage] to participate in the wholesale markets and potentially earn new revenue streams” because their challenge was only to a narrow aspect.

“The court did not appear headed toward making a broad jurisdictional conclusion that would vacate 841,” Jeff Dennis, general counsel for Advanced Energy Economytweeted. “Seems like the court could either (1) dismiss for lack of standing, saying no state has shown precise harm to its regulation of distribution facilities or (2) find that 841 properly exercises FERC’s authority over wholesale transactions by local storage resources, while leaving to a future case how this exercise of authority interacts with state actions to regulate safety and reliability of distribution facilities...”

Read the entire RTO Insider piece here (sub. req.). 

Topics: AEE In The News