Justia Government & Administrative Law Opinion Summaries

This case involves a challenge to a tariff adopted by the California Public Utilities Commission (Commission) that significantly reduced the compensation utilities pay to customers who generate electricity through rooftop solar panels and export excess energy to the grid. Petitioners, including environmental organizations, argued that the Commission’s tariff was inconsistent with Public Utilities Code section 2827.1, which requires the Commission to ensure that compensation for customer-generators reflects the costs and benefits of renewable generation and supports sustainable growth, particularly among disadvantaged communities.The First Appellate District, Division Three, of the California Court of Appeal granted a writ of review and affirmed the Commission’s decision. In doing so, the Court of Appeal applied a highly deferential standard of review derived from the California Supreme Court’s decision in Greyhound Lines, Inc. v. Public Utilities Com., asking only whether the Commission’s interpretation of the statute bore a reasonable relation to statutory purposes and language. The court concluded that the Commission’s approach satisfied this standard and declined to engage in a more searching review of the statutory interpretation.The Supreme Court of California reviewed the case to determine whether the deferential Greyhound standard remains appropriate following legislative amendments to the Public Utilities Code. The Supreme Court held that, for Commission decisions not pertaining solely to water corporations, the deferential Greyhound standard no longer applies. Instead, courts must independently review the Commission’s statutory interpretations under the standards set forth in Public Utilities Code sections 1757 and 1757.1, which parallel the review of other administrative agencies. The Supreme Court reversed the judgment of the Court of Appeal and remanded the case for further proceedings consistent with this less deferential standard. View "Center for Biological Diversity, Inc. v. Public Utilities Com." on Justia Law

The case concerns a challenge to the United States Department of the Interior’s approval of the 2024–2029 National Outer Continental Shelf Oil and Gas Leasing Program, which authorizes up to three lease sales in the Gulf of Mexico region. Environmental organizations argued that the Department failed to adequately assess the risks to vulnerable coastal communities, did not properly consider the endangered Rice’s whale in its environmental sensitivity analysis, overlooked potential conflicts with other ocean uses, and did not sufficiently balance the program’s projected benefits against its environmental costs. The Department, in coordination with the Bureau of Ocean Energy Management, had developed the program through a multi-year process involving public comment and environmental review.After the Department finalized the program, the environmental groups and the American Petroleum Institute (API) each petitioned for review in the United States Court of Appeals for the District of Columbia Circuit. API later withdrew its petition but remained as an intervenor. The environmental petitioners sought to have the program remanded for further consideration, arguing violations of the Outer Continental Shelf Lands Act (OCSLA). The Department and API contested the petitioners’ standing and the merits of their claims.The United States Court of Appeals for the District of Columbia Circuit held that the environmental petitioners had associational standing to pursue their claims. On the merits, the court found that the Department of the Interior had satisfied OCSLA’s requirements by reasonably evaluating environmental justice concerns, the selection of representative species for environmental sensitivity analysis, and potential conflicts with other uses of the Gulf. The court concluded that the Department’s decision-making process was reasoned and not arbitrary or capricious. Accordingly, the court denied the petition for review, leaving the 2024–2029 leasing program in effect. View "Healthy Gulf v. Department of the Interior" on Justia Law

Several companies incorporated in Cyprus and the Isle of Man, who were shareholders of OAO Yukos Oil Company, alleged that the Russian Federation unlawfully expropriated Yukos’s assets between 2003 and 2004. The shareholders initiated arbitration proceedings under the Energy Charter Treaty, which Russia had signed but not ratified, claiming that Russia’s actions violated the Treaty’s protections against expropriation. The arbitral tribunal in The Hague found in favor of the shareholders, awarding them over $50 billion in damages. Russia contested the tribunal’s jurisdiction, arguing that it was not bound to arbitrate under the Treaty because provisional application of the arbitration clause was inconsistent with Russian law, and that the shareholders were not proper investors under the Treaty.After the tribunal’s decision, Russia sought to set aside the awards in Dutch courts. The Dutch Supreme Court ultimately upheld the tribunal’s jurisdiction and the awards, finding that Russia was provisionally bound by the Treaty’s arbitration clause and that the shareholders qualified as investors. Meanwhile, the shareholders sought to enforce the arbitral awards in the United States District Court for the District of Columbia. Russia moved to dismiss, asserting sovereign immunity under the Foreign Sovereign Immunities Act (FSIA) and arguing that the arbitration exception did not apply because there was no valid arbitration agreement. The district court denied Russia’s motion, holding that it had jurisdiction under the FSIA’s arbitration exception, and deferred to the arbitral tribunal’s determination that an arbitration agreement existed.On appeal, the United States Court of Appeals for the District of Columbia Circuit held that the existence of an arbitration agreement is a jurisdictional fact under the FSIA that must be independently determined by the district court, rather than deferred to the arbitral tribunal. The court vacated the district court’s judgment and remanded for independent consideration of whether the FSIA’s arbitration exception applies, including whether the Dutch courts’ judgments should have preclusive effect. View "Hulley Enterprises Ltd. v. Russian Federation" on Justia Law

The Federal Energy Regulatory Commission (FERC) approved a 1,000-foot natural-gas pipeline crossing the U.S.-Mexico border. The Sierra Club and Public Citizen challenged this approval, arguing that FERC should have exercised jurisdiction over a longer 157-mile pipeline extending into Texas, considered the environmental impact of the entire pipeline, and evaluated alternatives to the border-crossing segment. They also claimed that FERC's approval of the border-crossing pipeline was arbitrary and capricious.The lower court, FERC, concluded that it did not have jurisdiction over the 157-mile Connector Pipeline because it did not cross state lines or carry interstate gas upon entering service. FERC conducted an Environmental Assessment for the 1,000-foot Border Facility, found minimal environmental impact, and deemed it in the public interest. After FERC reaffirmed its conclusions on rehearing, the petitioners sought judicial review.The United States Court of Appeals for the District of Columbia Circuit reviewed the case. The court held that FERC reasonably declined to exercise jurisdiction over the Connector Pipeline under Section 3 of the Natural Gas Act, respecting state regulatory authority. The court also found substantial evidence supporting FERC's conclusion that the Connector Pipeline would not transport interstate gas initially, thus not subjecting it to Section 7 jurisdiction. The court rejected the petitioners' claims that FERC's approval of the Border Facility was arbitrary and capricious, noting the presumption favoring authorization under the Natural Gas Act.Regarding the National Environmental Policy Act (NEPA), the court found that FERC reasonably defined the project's purpose and need, appropriately limited its environmental review to the Border Facility, and did not need to consider the upstream Connector Pipeline's impacts. The court denied the petition, affirming FERC's decisions. View "Sierra Club v. FERC" on Justia Law

Summit Carbon Solutions, LLC plans to build an interstate pipeline through Iowa, passing through Shelby and Story Counties. Both counties enacted ordinances regulating pipelines, including setback, emergency response plan, and local permit requirements. Summit challenged these ordinances, claiming they were preempted by the federal Pipeline Safety Act (PSA) and Iowa law. The district court granted summary judgment in favor of Summit, permanently enjoining the ordinances.The United States District Court for the Southern District of Iowa reviewed the case and ruled in favor of Summit, finding that the PSA preempted the counties' ordinances. The court held that the ordinances imposed safety standards, which are under the exclusive regulatory authority of the federal government. The court also found that the ordinances were inconsistent with Iowa state law, which grants the Iowa Utilities Commission (IUC) the authority to regulate pipeline routes and safety standards.The United States Court of Appeals for the Eighth Circuit reviewed the case de novo and affirmed the district court's decision. The court held that the PSA preempts the Shelby and Story ordinances' setback, emergency response, and abandonment provisions. The court found that the ordinances' primary motivation was safety, which falls under the exclusive regulatory authority of the federal government. The court also held that the ordinances were inconsistent with Iowa state law, as they imposed additional requirements that could prohibit pipeline construction even if the IUC had granted a permit.The Eighth Circuit affirmed the district court's judgment in both cases, but vacated and remanded the judgment in the Story County case to the extent it addressed a repealed ordinance. View "McNair v. Johnson" on Justia Law

Energy Harbor, LLC, the owner and operator of the W.H. Sammis power plant, was assessed $12 million in penalties by PJM Interconnection, L.L.C. for failing to comply with PJM’s Tariff during a major winter storm in December 2022. Energy Harbor contested these penalties, arguing that the penalties were inconsistent with the terms of the Tariff, particularly the exception for maintenance outages. The Federal Energy Regulatory Commission (FERC) denied Energy Harbor’s complaint, leading Energy Harbor to petition for judicial review.The Federal Energy Regulatory Commission (FERC) reviewed Energy Harbor’s complaint and found that PJM had correctly interpreted the Tariff and calculated the penalties. FERC concluded that the maintenance outage at the Sammis Plant was not the sole cause of the performance shortfall, as the plant had sufficient capacity to meet its commitments but failed due to forced outages. Energy Harbor’s request for rehearing was denied by operation of law.The United States Court of Appeals for the District of Columbia Circuit reviewed the case and upheld FERC’s decision. The court agreed with FERC’s interpretation of the Tariff, stating that PJM correctly evaluated whether the maintenance outage was the sole cause of the performance shortfall. The court found that the Sammis Plant had enough installed capacity to meet its expected performance during the emergency, and the forced outages were also causes of the shortfall. The court also rejected Energy Harbor’s argument that the penalty exception should be assessed for each generating unit, affirming that the entire Sammis Plant was the resource at issue. Consequently, the court denied Energy Harbor’s petition for review. View "Energy Harbor, LLC v. FERC" on Justia Law

A regional transmission organization, Southwest Power Pool, sought to integrate the City of Nixa's transmission assets into its Zone 10 infrastructure. This integration would spread the costs of the Nixa Assets across all Zone 10 customers. Several nearby cities and utilities objected, arguing that they would bear unjustified costs without receiving corresponding benefits. They took their objections to the Federal Energy Regulatory Commission (FERC).FERC initially found insufficient evidence to determine whether the cost shift was justified and remanded the case for further proceedings. After a second hearing, an administrative law judge concluded that the integration was just and reasonable, providing incremental benefits such as improved reliability and power support for all Zone 10 customers. FERC affirmed this decision, finding that the integration's benefits justified the cost shift and denied the non-Nixa parties' request for rehearing.The United States Court of Appeals for the District of Columbia Circuit reviewed the case. The court held that FERC's decision to analyze costs and benefits at the zonal level, rather than on a customer-by-customer basis, was reasonable. The court noted that requiring a hyper-granular approach would undermine the zonal system. The court also upheld FERC's consideration of unquantifiable systemwide benefits, such as improved integration and reliability, as sufficient to justify the cost shift. Finally, the court found that FERC's decision was supported by substantial evidence, including testimony and records indicating that the integration would benefit all Zone 10 customers.The court denied the petition for review, affirming FERC's decision to approve the integration and the associated cost allocation. View "Paragould Light & Water Commission v. FERC" on Justia Law

Equinor Energy LP operated oil and gas wells in North Dakota and contracted with its affiliate for saltwater gathering services. Versa Energy, LLC, a non-operating working interest owner in these wells, alleged that Equinor overcharged for these services. Versa petitioned the North Dakota Industrial Commission to determine the proper costs, claiming Equinor violated state law by charging more than the "reasonable actual cost" of operation.The North Dakota Industrial Commission concluded it had jurisdiction to adjudicate the dispute and determined that Equinor's costs were improper. The Commission set the proper cost for saltwater gathering services at $0.35 per barrel. Equinor appealed to the District Court of McKenzie County, which affirmed the Commission's order.The North Dakota Supreme Court reviewed the case and concluded that the Commission lacked jurisdiction to adjudicate the dispute. The court held that the Commission's regulatory authority under N.D.C.C. § 38-08-04 does not extend to adjudicating private contractual disputes. Additionally, the court determined that saltwater gathering costs are post-production costs, which fall outside the scope of "operation of a well" under N.D.C.C. § 38-08-08(2). Therefore, the Commission did not have jurisdiction under this statute to determine the proper costs for saltwater gathering.The North Dakota Supreme Court reversed the district court's order and vacated the Commission's order. View "Equinor Energy v. NDIC" on Justia Law

Michigan Electric Transmission Company (METC) owns a high-voltage transmission line with Michigan Public Power Agency (MPPA) and Wolverine Power Supply Cooperative. The case concerns the ownership of new transmission facilities, or "network upgrades," connecting a new solar generation park to the transmission line. METC claims exclusive ownership based on existing agreements, while MPPA and Wolverine disagree.The Federal Energy Regulatory Commission (FERC) reviewed the case and found that no agreement conclusively determined ownership rights. FERC declined to decide the ownership question, leading METC to petition for review.The United States Court of Appeals for the District of Columbia Circuit reviewed the case. The court agreed with FERC's interpretation that the relevant agreements did not grant METC exclusive ownership of the network upgrades. The court found that the Styx-Murphy line qualifies as a "system" under the Transmission Owners Agreement (TOA), and since METC is not the sole owner, it cannot claim exclusive ownership. The court also found that the Styx-Murphy Agreements did not preclude MPPA and Wolverine from owning network upgrades.The court denied METC's petitions for review, upholding FERC's decision. View "Michigan Electric Transmission Company, LLC v. FERC" on Justia Law

The case involves Oklahoma Gas and Electric Company (OG&E) and CKenergy Electric Cooperative, Inc. (CKenergy) regarding the provision of retail electric service to two facilities located in CKenergy's certified territory. OG&E began providing service to these facilities in 2017 and 2018, respectively. CKenergy filed an application with the Oklahoma Corporation Commission (the Commission) in 2019, requesting that OG&E be enjoined from continuing to serve the facilities, arguing that OG&E was in violation of the Retail Energy Supplier Certified Territory Act (RESCTA). OG&E contended that it was allowed to serve the facilities under the one megawatt exception of RESCTA.The Commission found that the connected load for initial full operation did not meet or exceed 1,000 kW at either facility and enjoined OG&E from providing service. OG&E appealed the Commission's order. The Commission also issued an order granting OG&E's request for a stay upon posting a supersedeas bond, which CKenergy and the Oklahoma Association of Electric Cooperatives (OAEC) appealed.The Supreme Court of the State of Oklahoma reviewed the case de novo. The Court held that the term "connected load for initial full operation" in the one megawatt exception of RESCTA refers to the total nameplate values of all connected electrical equipment when full operation of the facility commences. The Court found that the Commission's interpretation ignored the plain language of the statute and was not sustained by law. It was undisputed that the connected load for each facility exceeded 1,000 kW when full operation commenced. Therefore, the one megawatt exception applied, and the Commission improperly enjoined OG&E from providing service. The Court reversed the Commission's order and deemed the appeal regarding the stay moot. View "OG&E Co. v. OKLAHOMA CORPORATION COMMISSION" on Justia Law