On November 28, 2022, various State Attorneys General intervened to protest (the “Protest”) a filing made by The Vanguard Group, Inc., along with its affiliated entities (collectively, “Vanguard”) requesting to extend the blanket waiver authorization granted by the Commission for acquisitions of voting securities of publicly traded utilities. Utah, Indiana, Alabama, Arkansas, Kentucky, Louisiana, Mississippi, Montana, Nebraska, Ohio, South Carolina, South Dakota, and Texas, by and through their Attorneys General (collectively, “the States”), requested that the Commission deny Vanguard’s application for blanket reauthorization and set the proceeding for hearing.

On November 7, 2022, Vanguard filed an application seeking a three-year extension of its blanket authorization, which permits Vanguard to acquire and administer the voting for its applicant funds of up to 20 percent of the outstanding voting securities of any individual utility, or up to 10% ownership by any individual Vanguard fund. On February 16, 2022, Vanguard requested a similar reauthorization of its blanket authorization, which the Commission authorized, but only for a period of nine months and not the full three-year period requested. (See Vanguard Group, Inc., 180 FERC ¶ 62,065 (2022)). Commissioners Danly and Christie wrote separately requesting additional information from Vanguard that would allow the Commission an opportunity to provide additional scrutiny and cautioning that Vanguard could potentially exercise profound control over the utilities it owns.

In their Protest to Vanguard’s November 7 filing, the States argue that Vanguard is in breach of its initial 2019 authorization and that a new blanket authorization is not within the public interest. The States note that Vanguard’s initial 2019 authorization was based on assurances from Vanguard that it would refrain from investing “for the purpose of managing” utility companies. In particular, Vanguard promised it would not take any action “affecting the prices at which power is transmitted or sold, nor would it seek to “exercise any control over the day-to-day management” of utility companies. According to the States, Vanguard broke their promise to the Commission by engaging in environmental activism and using its financial influence to manipulate the activities of the utility companies in its portfolio. The States suggest that Vanguard abandoned their status as a passive investor in public utilities and has adopted a motive consistent with managing the utility through its environmental commitments and involvement with environmental groups that work to accelerate efforts regarding net zero emissions. The States, therefore, request the Commission set a hearing in the proceeding to determine whether extending Vanguard’s blanket authorization is in the public interest, therefore, determine whether Vanguard has breached its authorization.

You can find a copy of the filing here.