Energy Legal Blog

PJM capacity prices were just and reasonable in 2007 and 2008, the first years for which PJM’s FERC-approved Reliability Pricing Model (RPM) auction set capacity prices.  So ruled a unanimous panel of the US Court of Appeals for the DC Circuit in a February 8 decision.  According to the court, PJM and FERC had taken adequate steps to prevent electricity generators from exercising market power to elevate prices above competitive levels.  The court gave short shrift to the complaints of Maryland and New Jersey regulators, municipal utilities, and industrial consumers who alleged that RPM allowed capacity sellers to exercise market power in the 2007 and 2008 RPM auctions. (more…)

On February 2, 2011, the United States District Court for the Southern District of New York entered a Final Judgment relating to a settlement reached with KeySpan Corporation (“KeySpan”) of a Department of Justice (“DOJ”) Complaint regarding certain activity allegedly engaged in by KeySpan in the electric generating capacity markets in New York City (the “Order“).  In the Order, the court made clear that disgorgement is available as a remedy for a Sherman Act violation and approved a settlement that provided for the disgorgement of $12 million of KeySpan’s revenues.

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In a recent energy industry conference in Houston, EPA Region 6 Regional Administrator Dr. Al Armendariz and Bracewell & Giuliani partner Jeff Holmstead (who headed EPA’s Air Office under the Bush Administration) discussed EPA’s new greenhouse gas (GHG) permitting requirements.  Perhaps not surprisingly, they expressed different views about the GHG permitting program and specifically about the uncertainty caused by the need for companies to go through an EPA-mandated permitting process before they can build a new facility or make a significant modification to an existing facility.  This permitting process is designed, among other things, to determine what is the Best Available Control Technology (BACT) for controlling GHG emissions from the new or modified plants. (more…)

On February 1, two members of a three-judge panel of the US Court of Appeals for the Ninth Circuit vacated the Department of Energy’s (DOE) October 2007 designation of two National Interest Electric Transmission (NIET) corridors,  within which Congress, in the Energy Policy Act of 2005 (EPAct 2005), authorized the Federal Energy Regulatory Commission (FERC) to approve and expedite the construction of new high-voltage electric transmission lines.  Coupled with a 2009 decision of the Fourth Circuit that circumscribed FERC’s new authority in Federal Power Act § 216 to authorize transmission construction in NIET corridors, the Ninth Circuit decision in California Wilderness Coalition v. DOE mostly eviscerates federal siting of electric transmission lines—at least for now. (more…)

Matt Armstrong appears on Platts Energy Week to discuss the potential impact of the Oscar-nominated documentary Gasland on the natural gas industry, regulatory responses to shale production, and the evolving strategic communications strategies of gas producers.

This week FERC approved a PJM proposal to establish two new demand resource (DR) products for the PJM forward capacity market, which is conducted under the Reliability Pricing Model (RPM).  PJM holds one Base Residual Auction (BRA) and up to three incremental auctions yearly to procure capacity for a future delivery year under the RPM.  FERC’s approval brings to three the number of DR products that will be offered in the next BRA, which will occur in May 2011 for the 2014-15 delivery year. (more…)