EPSA says full D.C. Circuit should not rehear FERC demand response case

The Electric Power Supply Association (EPSA) says there is no need for the full U.S. Court of Appeals for the District of Columbia Circuit to rehear a case decided in May by a three-judge panel for the D.C. Circuit.

In a split-decision issued May 23, a three-judge panel for the D.C. Circuit vacated a Federal Energy Regulatory Commission (FERC) rule concerning demand side management “in its entirety.”

FERC has sought a rehearing before the entire court but EPSA, which represents independent power producers, says no rehearing is necessary.

In a legal filing made Aug. 4, EPSA said FERC is not challenging the underlying merits of the panel’s determination that the demand response rule was arbitrary and capricious.

“Instead, the Commission seeks rehearing only on whether its final rule exceeded its statutory authority. That question does not warrant rehearing,” EPSA said in a 23-page legal brief.

“The Commission’s jurisdictional arguments all turn on its assertion that because “demand response” is a commitment not to consume energy, it is technically not a retail “sale” of energy and therefore does not fall within the States’ exclusive jurisdiction under the Federal Power Act,” EPSA said. EPSA said the FERC position misreads the statute.

“As the panel recognized, the statute imposes a bright-line division of authority between the Commission’s exclusive jurisdiction over wholesale markets (i.e., wholesale rates and sales) and the States’ exclusive jurisdiction over retail markets (i.e., retail rates and sales),” EPSA said.

The final rule exceeded FERC authority because it directs that certain retail customers receive payment at a FERC-approved rate for reducing their retail purchases of electric energy. “The rule is thus a direct attempt to regulate matters — retail rates and sales — that the statute unambiguously places beyond the Commission’s jurisdictional reach,” EPSA contends.

The petition should be denied EPSA says in the legal filing. The filing was submitted on EPSA behalf by its attorney, Ashley Parrish of King & Spalding.

About Wayne Barber 4201 Articles
Wayne Barber, Chief Analyst for the GenerationHub, has been covering power generation, energy and natural resources issues at national publications for more than 20 years. Prior to joining PennWell he was editor of Generation Markets Week at SNL Financial for nine years. He has also worked as a business journalist at both McGraw-Hill and Financial Times Energy. Wayne also worked as a newspaper reporter for several years. During his career has visited nuclear reactors and coal mines as well as coal and natural gas power plants. Wayne can be reached at wayneb@pennwell.com.