DAYTON POWER & LIGHT COMPANY, dba AES Ohio, American Electric Power Service, DUKE ENERGY OHIO, INC., and FIRSTENERGY SERVICE COMPANY (21- 4072/22-3351); AMERICAN ELECTRIC POWER SERVICE CORPORATION (22-3196/23-3366); OFFICE OF THE OHIO CONSUMERS’ COUNSEL (23-3324/3417) v. FEDERAL ENERGY REGULATORY COMMISSION - Articles

All Content

DAYTON POWER & LIGHT COMPANY, dba AES Ohio, American Electric Power Service, DUKE ENERGY OHIO, INC., and FIRSTENERGY SERVICE COMPANY (21- 4072/22-3351); AMERICAN ELECTRIC POWER SERVICE CORPORATION (22-3196/23-3366); OFFICE OF THE OHIO CONSUMERS’ COUNSEL (23-3324/3417) v. FEDERAL ENERGY REGULATORY COMMISSION

Posted by: Azya Thornton on Jan 17, 2025

Court: 6th Circuit Court (Published Opinions)

Attorneys 1: ARGUED: Matthew E. Price, JENNER & BLOCK LLP, Washington, D.C., for Petitioners. Carol J. Banta, FEDERAL ENERGY REGULATORY COMMISSION, Washington, D.C., for Respondent.

Attorneys 2: ARGUED: Thomas G. Lindgren, OFFICE OF THE OHIO ATTORNEY GENERAL, Columbus, Ohio, for Intervenor Public Utilities Commission of Ohio.

Attorneys 3: ON BRIEF: Matthew E. Price, Zachary B. Cohen, JENNER & BLOCK LLP, Washington, D.C., William M. Rappolt, AES US SERVICES, LLC, Arlington, Virginia, William M. Keyser, STEPTOE & JOHNSON LLP, Washington, D.C., Morgan E. Parke, P. Nikhil Rao, FIRSTENERGY SERVICE COMPANY, Akron, Ohio, Sanford I. Weisburst, QUINN EMANUEL URQUHART & SULLIVAN, LLP, New York, New York, for the Dayton Power & Light Co. et al. Petitioners.

Attorneys 4: ON BRIEF: Carol J. Banta, FEDERAL ENERGY REGULATORY COMMISSION, Washington, D.C., for Respondent.

Attorneys 5: ON BRIEF: G. Lindgren, OFFICE OF THE OHIO ATTORNEY GENERAL, Columbus, Ohio, for Intervenor Public Utilities Commission of Ohio. Denise C. Goulet, Wendy Simon Pearson, MCCARTER & ENGLISH, LLP, Washington, D.C., for Petitioner Office of the Ohio Consumers’ Counsel in 23-3324 and 23-3417 and as an Intervenor in 21-4072, 22-3351, 23-3196, and 23-3366.

Attorneys 6: ON BRIEF: Paul M. Flynn, Ryan J. Collins, WRIGHT & TALISMAN, P.C., Washington, D.C., for Intervenor PJM Interconnection, L.L.C. Cynthia S. Bogorad, David E. Pomper, Jeffrey M. Bayne, Lauren L. Springett, SPIEGEL & MCCIARMID LLP, Washington, D.C., for Intervenor Buckeye Power.

Attorneys 7: ON BRIEF: Heather M. Horne, DUKE ENERGY CORPORATION, Washington, D.C., Matthew A. Fitzgerald, MCGUIREWOODS LLP, Richmond, Virginia, for Intervenor Duke Energy Ohio, Inc. Sanford I. Weisburst, QUINN EMANUEL URQUHART & SULLIVAN, LLP, New York, New York, Morgan E. Parke, P. Nikhil Rao, FIRSTENERGY SERVICE COMPANY, Akron, Ohio, for Intervenor FirstEnergy Service Company in 23-3324, 23-3366, and 23-3417.

Judge(s): MOORE, NALBANDIAN, and BLOOMEKATZ, Circuit Judges

Court Appealed: Petitions for Review of Orders the Federal Energy Regulatory Commission

BLOOMEKATZ, Circuit Judge. In 2005, Congress amended Section 219 of the Federal Power Act (FPA), directing the Federal Energy Regulatory Commission (FERC) to make the country’s electric grid more efficient, reliable, and affordable for consumers. Among other measures, Congress mandated that FERC “provide for incentives to each . . . electric utility that joins” a regional transmission organization (RTO). 16 U.S.C. § 824s(c). RTOs operate regional electricity grids and facilitate competition, efficiency, and reliability. They also lower consumer prices. Following Congress’s instruction, FERC promulgated a rule allowing utilities to charge higher wholesale electricity rates as an incentive for joining an RTO. See Promoting Transmission Investment Through Pricing Reform, 116 FERC ¶ 61,057 (2006). We call that surcharge the “RTO adder.” Consistent with Congress’s goal of encouraging RTO participation, FERC ultimately determined that a utility can qualify for the higher rate only if it voluntarily joins an RTO. FERC thus excludes utilities that are required to join an RTO by state law because the extra payment cannot “incentivize” membership. We affirm FERC’s denial of Dayton Power’s application for an RTO adder in the Dayton Power proceeding and its revocation of AEP’s RTO adder in the OCC proceeding. We reverse FERC’s order in the OCC proceeding declining to revoke the RTO adder from Duke’s and FirstEnergy’s adder-inclusive settlement rates and remand for further proceedings consistent with this opinion.

Attachments: