‘Long shot’ lawsuit takes aim at FERC order

Source: By Niina H. Farah, E&E News reporter • Posted: Tuesday, March 3, 2020

Consumer advocates yesterday jump-started litigation over recent policy changes for the nation’s largest power market due to concerns that a separate round of legal wrangling over Federal Energy Regulatory Commission procedures could block their path to judicial review.

Groups from three states and Washington said they filed their early lawsuit in the U.S. Court of Appeals for the District of Columbia Circuit over FERC’s Dec. 19, 2019, “minimum offer price rule,” or MOPR, out of “an abundance of caution.” The MOPR governs how energy resources bid into the PJM Interconnection capacity market.

The lawsuit comes as rehearing requests on the order are still pending, but ratepayer advocates said they were concerned that the outcome of a separate case, Allegheny Defense Project v. FERC, could alter the commission’s use of tolling orders to delay rehearing requests and lock out challenges to the PJM order.

“Petitioners have filed this protective petition for review because of a concern that, in these circumstances, awaiting further Commission action before seeking judicial review of the December 19 Order could result in a loss of Petitioners’ rights to do so,” the advocates wrote.

The challengers in the case are the New Jersey Division of Rate Counsel, Office of the People’s Counsel for the District of Columbia, Maryland Office of the People’s Counsel and Delaware Division of the Public Advocate.

They said that filing a lawsuit now — before PJM has offered a response to FERC about the order — is necessary as a protective measure in case the D.C. Circuit decides to overturn the legality of tolling orders and apply the PJM policy change retroactively.

The full set of active D.C. Circuit judges is set to hear arguments in Allegheny Defense Project, a challenge stemming from FERC’s certificate for the Atlantic Sunrise natural gas pipeline project in Pennsylvania, on March 31.

A judge for the court last year decried as “Kafkaesque” FERC’s process of issuing tolling orders to delay landowners’ rehearing requests while pipeline developers are allowed to move forward with construction.

The pipeline challenge, ratepayer advocates said, could not only force FERC to act more quickly but also start the clock on lawsuits.

If the D.C. Circuit’s decision is retroactive, they said, that could mean the 60-day window to file a challenge to the PJM order would have opened on Feb. 21.

The groups have asked the D.C. Circuit to hold their petition in abeyance until the court reaches a decision in Allegheny Defense Project.

ClearView Energy Partners LLC called the petition a “long shot” but said it had the potential to undo FERC’s PJM order if the D.C. Circuit found the agency couldn’t take unlimited time to review rehearing requests.

“A decision that changes the court’s interpretation of FERC’s tolling order authority this fall could potentially complicate the ability of PJM to hold auctions late in 2020 or early in 2021 as it currently plans, as these Petitioners may then have grounds to seek an injunction pending appeal,” ClearView wrote in a memo yesterday.