Public Citizen v. FERC (ISO-NE)

Consumer Justice
Case Description: 

This case is a challenge to a Federal Energy Regulatory Commission action refusing to review the lawfulness of an increase in rates for wholesale electric capacity, which resulted from a noncompetitive auction conducted by the New England Independent System Operator. FERC rejected a challenge to the rates under section 205 of the Federal Power Act, which requires that all rates be “just and reasonable,” because of a deadlock among the four Commissioners then sitting. (There was a vacancy in the 5-member Commission at the time.) Two Commissioners would have set the issue of the rates’ lawfulness for a hearing, but two would have dismissed the challenge to the rates because of their view that FERC could not consider whether the actual rates resulting from an auction conducted under rules approved by FERC were lawful. Because FERC requires a majority vote to proceed, the deadlock resulted in the rates’ going into effect. Public Citizen, as well as Connecticut agencies and officials, filed petitions for review in the D.C. Circuit. FERC challenged the court’s jurisdiction, arguing that it issued no order and took no action subject to judicial review. Public Citizen’s briefs argue that the agency’s deadlock is a reviewable action because it effectively rejected the challenge to the rates, and that the rationale of the Commissioners who blocked the agency action—namely, that the agency lacked authority to review the lawfulness of the rates—is contrary to law.