On June 29, 2021, the Supreme Court of the United States ruled that a certificate of public convenience and necessity issued by FERC under section 7 of the Natural Gas Act (“NGA”) authorizes a private company to exercise eminent domain to condemn state-owned property.  In particular, the opinion holds that states cannot claim sovereign immunity from condemnation lawsuits filed by certificated pipelines against the state in order to take public land to construct, own, and operate an interstate gas pipeline project.    
Continue Reading Supreme Court Rules that PennEast, Gas Pipelines May Condemn State-Owned Land

On June 17, 2021, FERC issued an order providing guidance on the means by which sellers in the Western Electricity Coordinating Council (“WECC”) market can demonstrate that sales made above the $1,000/MWh soft price cap were just and reasonable.  This guidance has been provided for sellers with pending justification filings, which have been granted 30 days to amend or supplement their filings accordingly, as well as any sellers making prospective justification filings.
Continue Reading FERC Provides Guidance on Justification Filings for Sales Above the WECC Soft Price Cap

On May 19, 2021, FERC issued an order dismissing requests for rehearing of an order directing briefing (“Briefing Order”) about the operation of Algonquin Gas Transmission, LLC’s  Atlantic Bridge project after finding that requesting parties were not “aggrieved” under court precedent interpreting Section 19(a) of the Natural Gas Act (“NGA”).  Commissioner James Danly wrote separately in dissent explaining his view that FERC’s request for briefing means that the determinations made in the Atlantic Bridge certificate order are no longer settled and that the certificate order is in fact no longer final.  
Continue Reading FERC Maintains Order Directing Briefing Long After Authorizing Gas Facilities to Begin Operations, Prompting Dissent from Commissioner Danly

On May 4, 2021, FERC issued Order No. 871-B, clarifying that the rule established in Order No. 871, which precludes FERC from authorizing natural gas pipeline companies to proceed with construction of approved pipeline projects, only applies until the earlier of either (a) the date that a qualifying rehearing request is no longer pending before FERC or (b) 90 days following the date that a qualifying request for rehearing may be deemed denied by operation of law. FERC also limited the application of this rule to requests for rehearing that raise issues reflecting opposition to project construction, operation, or need. Finally, FERC announced a general policy to stay Natural Gas Act (“NGA”) section 7 certificate orders during the rehearing period and pending resolution of any timely requests for rehearing. Commissioner James Danly dissented, arguing that the need for Order No. 871 is obviated by further developments on appeal of FERC’s practice of indefinite tolling orders before the U.S. Court of Appeals for the D.C. Circuit (“D.C. Circuit”) and that presumptively staying pipeline project construction is contrary to the NGA and is “bad policy.” Commissioner Mark Christie concurred with Order No. 871-B.

Continue Reading FERC Revises Policy on Authorizing Pipelines to Commence Construction Pending Requests for Rehearing of Certificate Orders

On March 24, 2021, FERC modified a December 17, 2020 order (“December Order”) while reaching the same overall result, allowing construction to recommence for a portion of the Mountain Valley Pipeline, LLC (“Mountain Valley”) project located near Jefferson National Forest in Virginia. FERC determined that the Environmental Conditions in Mountain Valley’s certificate order did not preclude FERC from permitting Mountain Valley to resume construction on portions of its pipeline, even though certain federal authorizations that were vacated on appeal are still pending, and also reaffirmed that completing the construction would be preferable to temporary mitigation efforts. Chairman Richard Glick and Commissioner Allison Clements dissented, arguing that FERC cannot authorize Mountain Valley to resume construction while federal authorizations remain outstanding.
Continue Reading Mountain Valley Pipeline Construction to Resume over Opposition from Chairman Glick and Commissioner Clements

On March 19, 2021, FERC set aside a September 1, 2020 order (“September Order”) that had upended 40 years’ worth of FERC precedent regarding how to determine the 80MW threshold for small power production qualifying facilities (“QFs”) under the Public Utility Regulatory Policies Act of 1978 (“PURPA”). Specifically, FERC rejected the September Order’s denial of QF status to a hybrid photovoltaic solar and storage facility owned by Broadview Solar LLC (“Broadview”) as a result of the facility’s 160 MW gross capacity, as opposed to the facility’s 80 MW maximum net output or “send out.” After further consideration, FERC explained that it had erred by departing from and overturning its longstanding “send out” precedent. Commissioner Danly dissented, arguing that the September Order correctly applied PURPA in relying on gross power production capacity.
Continue Reading FERC Reverses September 2020 Order, Reinstating Long-Standing “Send Out” Test for Small Power Production QF 80MW Threshold

On February 26, 2021, FERC accepted a proposal from Entergy Services, LLC (“Entergy”) to amend a wholesale rate schedule, the Unit Power Sales Agreement (“UPSA”), subject to refund and set the matter for hearing.  FERC also instituted an investigation under section 206 of the FPA to allow customers to recover refunds associated with any further rate reduction, consolidated various related Entergy proceedings on accumulated deferred income taxes (“ADIT”), set a hearing procedure and held those procedures in abeyance pending the issuance of further FERC orders.
Continue Reading FERC Sets Entergy’s Proposal to Amend the Unit Power Sales Agreement for Hearing to Determine Whether Customers Should Receive a Bigger Rate Decrease

On February 18, 2021, FERC took action in a multi-year dispute over the PJM Interconnection’s capacity market pricing rule known as the Minimum Offer Price Rule (or, “MOPR”) by vacating a single troublesome footnote from its last order, making way for PJM to move ahead with its annual capacity auction after years of delay. The U.S. Court of Appeals for the Seventh Circuit will soon take up a host of appeals of FERC’s decisions on the controversial MOPR.
Continue Reading In PJM MOPR Proceeding, FERC Vacates Footnote Prompting Danly Dissent