Yesterday, the Minnesota Public Utilities Commission (“MPUC”) approved a settlement between Xcel Energy and various intervening stakeholders, to resolve the revenue requirement issues in Xcel Energy’s pending multi-year rate increase. The MPUC appeared to struggle with accepting the settlement in lieu of the full evidentiary record it is used to on financial issues. Nonetheless, it
On April 4, 2017 (NextEra Desert Center Blythe, LLC v. FERC, Case No. 16-1003 (“NextEra”)), the DC Circuit issued a decision remanding back to the Federal Energy Regulatory Commission (“FERC”) orders denying NextEra Desert Center Blythe, LLC’s (“NextEra”) complaint against the California Independent System Operator Corporation (“CAISO”) regarding the allocation of congestion revenue rights (“CRRs”) under the CAISO tariff. The DC Circuit’s ruling was narrow, based on finding ambiguity in the relevant contract and tariff provisions where FERC determined there was none. The court’s decision highlights the importance of addressing potential regulatory cost recovery options in a FERC-jurisdictional contract.
Continue Reading Generator Receives Another Shot at Obtaining CAISO Congestion Revenue Rights
On Thursday, a 2-1 decision by the Third District Court of Appeal in Sacramento upheld California’s program to reduce carbon emissions. California’s controversial and signature cap-and-trade program creates a firm limit on carbon emissions and auctions allowances that permit companies to release greenhouse gases into the atmosphere. Covered entities are generally large emitters of greenhouse gases, who under the program must surrender emissions allowances or offset credits to cover their emissions, or face monetary penalties or other negative consequences. Auctions are a key component of how California expects to meet its targets to reduce emissions to 1990 levels by 2020, and 40 percent below 1990 levels by 2030.
Continue Reading California Court of Appeals Upholds California’s Cap-and-Trade Program
As a follow up to yesterday’s post, President Trump’s Energy Independence Executive Order (the “Order”) has now been posted on the White House website, a summary of which can be found here. Over the last week, many pundits and industry insiders have speculated on its contents, with many having a fairly clear crystal…
Section 1 of the Order sets forth various policy objectives, many of which (e.g., clean, reliable, affordable, safe energy) are goals that should garner bi-partisan support. How these policies are interpreted by the various heads of agencies will be one factor guiding America’s energy future. Another policy factor may be critical, contained in section 1(d), that “all agencies should take appropriate actions to promote clean air and clean water for the American people, while also respecting the proper roles of Congress and the States concerning these matters in our constitutional republic.” This interplay between various states’ initiatives (and those states’ renewable portfolio standards) and the direction in the Order may impact the overall direction and tone set in the Order.
Continue Reading Brief Overview of President Trump’s Energy Independence Executive Order
Today, the Eighth Circuit determined that the Next Generation Energy Act (“NGEA”), a Minnesota law that established power sector standards for carbon dioxide emissions, was unconstitutional (decision available here). In so doing, the Court affirmed the decision of District Court Judge Susan Nelson, whose 2014 decision we covered in “Court Declares Minnesota…
The Minnesota Court of Appeals filed its decision today affirming the Public Utilities Commission’s August 6, 2015 Order in the community solar garden proceeding, which adopted the partial settlement agreement between certain solar developers and Xcel Energy and decided several crucial aspects of Xcel’s community solar program, including the 5 MW cap on co-located gardens. …
Today the U.S. Fish and Wildlife Service (Service) published notice in the Federal Register of proposed changes to its eagle permitting regulations (Proposed Rule). Concurrent with the Proposed Rule, the Service issued a Draft Programmatic Environmental Impact Statement (DPEIS) analyzing the proposed changes under the National Environmental Policy Act (NEPA), and a Status Report that estimates size, productivity, and survival rates for bald and golden eagles, and provides recommendations on authorized take limits. The Service is accepting comments on the Proposed Rule and the DPEIS until July 5, 2016.
Although we are still in the process of evaluating the entire package, the proposed changes represent a significant step forward for applicants seeking regulatory certainty through the eagle permitting process. Here’s a quick snapshot of the proposal:
(Re)extends maximum permit term to 30 years. As we discussed in a previous post, in August 2015, the U.S. District Court for the Northern District of California set aside the 30-year tenure provision of the 2013 revisions to the eagle permit regulations on NEPA grounds, concluding that the Service had failed to demonstrate an adequate basis in the record for deciding not to prepare an Environmental Impact Statement or Environmental Assessment. The Proposed Rule, now backed by NEPA analysis that evaluates the 30-year maximum term, once again extends the maximum term for eagle take permits from five to 30 years, subject to recurring five-year check-ins. In the Federal Register notice, the Service acknowledges that the “5-year maximum permit term is unnecessarily burdensome for businesses engaged in long-term actions that have the potential to incidentally take bald or golden eagles over the lifetime of the activity.”
Continue Reading U.S. Fish and Wildlife Service Issues Proposed Changes to Eagle Permit Regulations, Opens 60-Day Comment Period
The U.S. Supreme Court’s order on February 9, 2016 staying EPA’s implementation of the Clean Power Plan (CPP) will create at least a year of uncertainty about the shape of the future electric power regulatory framework, with implications for states, utilities and other electric power providers, and for the many other stakeholders potentially affected by the CPP. The CPP is the regulatory program issued by EPA on October 23, 2015, that requires states to develop plans to reduce carbon (CO2) emissions by meeting either state-specific mass caps (tons/year) or state-specific emission rate intensity limits (lb/netMWh). The CPP seeks to establish a whole new style of regulation using authority under section 111(d) of the Clean Air Act.
Supreme Court Halts CPP Implementation
Twenty-nine (29) states and a number of utilities, labor unions and trade associations challenged the legality of the CPP. These appellants sought a stay of the rule from the D.C. Circuit in November 2015. The petition for a stay was denied on January 21, 2016. The appellants then appealed to the U.S. Supreme Court — a move that most pundits thought was futile as it is extremely rare for the Supreme Court to grant such a stay. In order to grant a stay, the Court needed to find that if the D.C. Circuit were to uphold the CPP, (1) there is a reasonable probability that four Supreme Court Justices would vote for review of the D.C. Circuit opinion; (2) there is a fair prospect that a majority of the Supreme Court would vote to reverse the D.C. Circuit’s opinion upholding the CPP; and (3) that there is a likelihood that immediate, irreparable harm would result from the denial of a stay. By granting the stay, it appears that five of the nine Supreme Court justices (Roberts, Scalia, Alito, Kennedy and Thomas) indicated that they believe there is a fair prospect that they would vote to overturn the D.C. Circuit were the D.C. Circuit to uphold the CPP. The Court’s action prevents EPA from further implementation of the CPP until the petitioners’ appeal is decided. The underlying challenge to the CPP is proceeding on an expedited schedule with oral argument set for June 2 and 3, 2016.
In addition, another factor in the Court’s stay decision was likely the pending deadlines for states to take compliance actions. The deadline for states to submit initial plans demonstrating how they would comply with the CPP was September 6, 2016. While virtually all states were likely to request an extension for plan submittal until September 2018, states still needed to show progress on their plans by this September, and many states, including several of the 29 appellant states, were beginning the planning process.
Next Steps: Back to the D.C. Circuit
Continue Reading U.S. Supreme Court Stays Clean Power Plan Implementation: Next Steps
In the biggest consumer energy story of the day, and perhaps the decade, the U.S. Supreme Court today upheld FERC’s jurisdictional authority in FERC Order 745. Read the Decision here (PDF). The so called Demand Response Rule permits consumer energy products and services, such as demand response, to participate in wholesale energy markets, and to…