To ensure adequate electricity supply for its citizens, Maryland required its retail utilities to solicit bids for the construction of a new generation facility and to enter into long-term power-supply contracts with the winning bidder. The U.S. Court of Appeals for the Fourth Circuit held that Maryland’s attempt to secure power for its citizens was impliedly preempted by Federal Power Act’s grant of exclusive authority to FERC to regulate wholesale electricity rates. Maryland successfully sought review in the U.S. Supreme Court. In the Supreme Court, Public Citizen submitted an amicus brief arguing that Maryland’s action does not conflict with the FPA’s objectives of ensuring just and reasonable rates, and conferring FERC with authority over such rates, because FERC retains the ability to regulate both the contracts at issue and the wholesale capacity rates that they affect.
The Supreme Court ultimately held that Maryland program preempted, but stressed that the state could accomplish the same objectives if it did not impose requirements related to participation by the generator in a federal power auction program.