Cooperative federalism and energy law


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An overview of areas where state and federal law overlap or clash in energy regulatory sphere and solutions to date

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Cooperative federalism and energy law

  1. 1. Cooperative Federalism and Energy Law Carolyn Elefant Law Office of Carolyn Elefant Washington DC [email_address] 202-297-6100
  2. 2. What accounts for the persistent conflict between federal and state interests in the energy industry?
  3. 3. Statutory Imperatives · FERC regulates wholesale rates · States regulate retail rates and siting
  4. 4. Geographic Imperatives Offshore wind is located on federal OCS, but transmission runs through state submerged lands
  5. 5. Inevitable Tension National interest (FERC energy siting) has local impacts
  6. 6. Trends and Solutions
  7. 7. Siting:  LNG Federal/state conflict resolved with EPAct 2005 which FERC's "exclusive authority" (15 USC § 717b) States retain authority under CZMA, CWA
  8. 8. Siting:  LNG <ul><ul><li>&quot;while the EPAct of 2005 might have streamlined the federal [LNG siting] review process in some respects and changed the rules under which the review takes place, it has not dramatically changed the balance of power between the federal government and states.&quot; --J. Dweck, Siting LNG Facilities, 27 Energy Law Journal (2006) at 475 </li></ul></ul>
  9. 9. Siting:  Conditional Licenses <ul><ul><li>FERC grants license or certificate, but commencement of construction made contingent upon applicant obtaining necessary state authorizations </li></ul></ul><ul><ul><li>Lawfulness subject </li></ul></ul><ul><ul><li>States have to veto </li></ul></ul>
  10. 10. Siting:  MOUs for Offshore Wind & MHK <ul><ul><li>MOU between DOI and and 10 states to create Atlantic Offshore Wind Consortium for &quot;efficient, expeditious and responsible&quot; development of offshore wind on OCS April 2009, online at </li></ul></ul><ul><ul><li>MOUs between FERC and select states to coordinate MHK (online at ) </li></ul></ul>
  11. 11. Siting:  Coastal & State Marine Spatial Planning <ul><ul><li>Regional planning approach for ocean siting, with review by National Oceans Council (NOC) </li></ul></ul><ul><ul><li>Obama Executive CMSP Plan will leverage existing state efforts </li></ul></ul><ul><ul><li>Plan online at </li></ul></ul>
  12. 12. Siting:  Interstate compacts <ul><ul><li>NGA and FPA allow states to create &quot;interstate compacts&quot; to site electric transmission or gas pipelines subject to Congressional approval of compact (15 USC § 717j, Section 216, FPA) </li></ul></ul><ul><ul><li>Proposed HB1817  Pennsylvania House of Representatives would create MidAtlantic Council to site pipelines instead of FERC (online at ) </li></ul></ul>
  13. 13. Renewables Policy:  State RPS <ul><ul><li>Issue: States need to meet RPS, but need transmission to import renewables </li></ul></ul><ul><ul><li>FERC NOPR:  RTOs and transmission utilities must take account of state renewables policy goals during transmission planning RM 10-23, June 17, 2010 (online at ) </li></ul></ul>
  14. 14. Renewables Policy:  Feed-In Tariff <ul><ul><li>Issue; States want to set feed-in rates to encourage renewables, but FERC has exclusive jurisdiction over wholesale ratemaking </li></ul></ul><ul><ul><li>FERC Solution:  States can use PURPA authority to set feed-in rates (FERC Docket 10-64, 66, (July 15, 2010) online at </li></ul></ul><ul><ul><li>Rejected proposal: Allow states to set feed-in rates and obtain blanket FERC approval for program (see NREL Paper, S. Hempling, C. Elefant, K. Corey (online at ) </li></ul></ul>
  15. 15. Renewables Policy: National versus state benefits <ul><ul><li>· Energy Bill - national RPS (would create national market for RECs, necessitate transmission) · Inslee feed-in proposals - nationally structured feed-in tariffs State push back:  RPS programs that favor state projects (Canadian wind developer sues Massachusetts for solar carve out and preferential contracts, claiming commerce clause violations (partial settlement online at: </li></ul></ul>
  16. 16. Where to find me on social media: http:// http:// http:// [email_address]