FERC Prevails Again in Order No. 1000 Appellate Proceedings
On April 19, 2017, the U.S. Court of Appeals for the D.C. Circuit unanimously upheld the Federal Energy Regulatory Commission’s (FERC) implementation of Order No. 1000 with respect to ISO-New England (ISO-NE). The D.C. Circuit had previously upheld the legality of the order itself in 2014, and the Seventh Circuit upheld FERC’s implementation of Midcontinent Independent System Operator Inc.’s Order No. 1000 compliance plan in 2016. This week’s decision represents another success for FERC and its Order No. 1000 policy objectives.
Order No. 1000 required public utilities to alter their transmission planning and cost allocation methods. The order aimed to improve collaboration among market participants and to improve competition in the electricity market. For example, it requires public utility transmission providers to participate in regional transmission planning efforts. It also requires providers to remove all federal rights of first refusal (ROFR) from their FERC tariffs, which had given incumbent utilities the first choice for building new projects.
In the most recent challenge to Order No. 1000, state regulators and transmission owners challenged FERC’s approval of regional ISO-NE’s compliance filings. Two issues arose in the case: the transmission owners were concerned about the elimination of the ROFR, and the state regulators were concerned about protecting state authority over their rights to approve the construction of transmission facilities.