On January 19, 2017, FERC denied a request from Vote Solar Initiative and the Montana Environmental Information Center (collectively, “Vote Solar”) that FERC reconsider a November 1, 2016 order (“November Order”) dismissing Vote Solar’s complaint against the Montana Public Service Commission (“Montana Commission”), alleging that the Montana Commission violated section 210 of the Public Utility Regulatory Policies Act of 1978 (“PURPA”) by altering the state’s framework for solar projects seeking to be qualifying facilities (“QFs”). In requesting reconsideration, Vote Solar alleged that FERC misconstrued its complaint as being a request for enforcement pursuant to PURPA Section 210(h) and that it was instead a request for FERC to use its remedial authority under Federal Power Act (“FPA”) section 309. In denying the request, FERC explained that the broad language of its regulations does not give FERC greater enforcement authority than the operative statute itself. FERC also reiterated the jurisdiction and standing deficiencies inherent in the complaint, and noted that many of Vote Solar’s substantive concerns were addressed in a recently issued Notice of Intent Not to Act and Declaratory Order in a similar challenge brought by a QF against the Montana Commission.

As summarized in a previous WER article, Vote Solar alleged in its complaint that the Montana Commission violated section 210 of PURPA by suspending a utility’s obligation to adhere to the standard rate for solar QFs, extinguishing legally enforceable obligations to which these facilities were entitled under PURPA, and denying solar QFs opportunities to create future obligations (see November 8, 2016 edition of the WER). Vote Solar brought the complaint pursuant to Rule 206 of FERC’s Rules of Practice and Procedure and requested that FERC exercise its authority under PURPA Section 210(h)(2)(A) to enforce the statute against the Montana Commission. In its November Order, FERC dismissed the complaint, stating that it has no FPA Section 306 enforcement authority to order the Montana Commission to take or refrain from taking particular actions under PURPA, and that in either event, Vote Solar lacked standing to file such a complaint under PURPA Section 210(h) since it was neither a QF nor an electric utility.

Vote Solar sought reconsideration of the November Order, arguing that FERC erred by construing its complaint filed pursuant to Rule 206 as a petition for enforcement pursuant to PURPA Section 210(h). Vote Solar argued that FERC has broad remedial authority under FPA section 309 and could also issue a declaratory order against the Montana Commission under Section 554(e) of the Administrative Procedure Act. In essence, Vote Solar urged FERC to exercise its FPA 309 remedial authority to enforce PURPA Section 210 against the Montana Commission.

In denying reconsideration, FERC reiterated the standing and enforceability concerns from its November Order. FERC further noted that although Rule 206 does allow “any person” to file a complaint against “any person alleged to be in contravention or violation of any statute, rule, order, or other law administered by the Commission,” that regulation cannot give the Commission greater enforcement authority than the statute itself. Furthermore, FERC stressed that an agency’s decision whether or not to enforce a statute, including PURPA, is committed to that agency’s sole discretion and outside the realm of judicial review.

Although FERC rejected Vote Solar’s procedural challenges to the November Order, FERC noted that many of Vote Solar’s substantive concerns were already raised by a QF against FERC in a separate challenge for which FERC issued a Notice of Intent Not to Act and a Declaratory Order on December 15, 2016 (FLS Energy, Inc. 157 FERC ¶ 61,211 (2016)) (“Notice and Declaratory Order”). In that Notice and Declaratory Order, FERC declined to enforce PURPA on behalf of the QF, FLS Energy Inc., thereby opening the door for the QF to bring its own enforcement action in district court. However, FERC issued a declaratory order finding that a requirement—such as the one set by the Montana Commission—for a facilities study or an interconnection agreement as a predicate for a legally enforceable obligation is inconsistent with PURPA and FERC’s regulations under PURPA.

A copy of FERC’s January 19 Order Denying Reconsideration can be found here.