On October 14, 2015, the Supreme Court heard oral argument in Federal Energy Regulatory Commission v. Electric Power Supply Association and EnerNOC v. Electric Power Supply Association.
These consolidated cases involve the efforts of the Federal Energy Regulatory Commission (FERC) to specify the methodology that operators in the wholesale electricity market use when compensating users for a commitment to reduce their consumption at particular times, a phenomenon known as “demand response.” The U.S. Court of Appeals for the D.C. Circuit determined that FERC lacked statutory authority to impose such a methodology. The Supreme Court agreed to consider the following two questions:
(1) Whether FERC reasonably concluded that it has authority under the Federal Power Act to regulate the rules used by operators of wholesale electricity markets to pay for reductions in electricity consumption and to recoup those payments through adjustments to wholesale rates; and (2) Whether the D.C. Circuit erred in holding that the rule issued by FERC is arbitrary and capricious.
Justice Alito appears to be recused from this case.
To discuss the case, we have James Coleman, who is assistant professor at the University of Calgary, Faculty of Law and Haskayne School of Business.