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- How Supreme Court will decisions impact FERC // Electricity prices on the rise // Australia considers nuclear power
How Supreme Court will decisions impact FERC // Electricity prices on the rise // Australia considers nuclear power
Jeff Luse
July 10, 2024
Welcome to Grid Brief! Here’s what we’re looking at today: how the overturning of the Chevron doctrine will affect FERC, why electricity prices are rising, and Australia’s plan to build nuclear power.
How Will Recent Supreme Court Decisions Impact FERC?
Two weeks ago, in Looper Bright Enterprises v. Raimondo, the Supreme Court overturned the Chevron doctrine which required courts to refer to agency interpretations of ambiguous language in statutes and legislation. A major court decision, Looper Bright now puts the onus on Congress to pass clear and comprehensive legislation that regulatory bodies can carry out and enforce.
After Looper Bright, many have been left to wonder how striking down the Chevron doctrine will impact certain regulatory agencies. According to the law firm Hunton, Andrews, Kurth, reversing Chevron will not likely impact the “routine” FERC matters:
“FERC’s rulings typically involve policy determinations or factual findings that receive judicial deference not because of Chevron, but because the Administrative Procedure Act (‘APA’) specifies that they are to be reviewed under the ‘arbitrary and capricious’ standard. The APA standard pre-dates Chevron, and Loper Bright expressly recognized that it continues to apply. Under arbitrary and capricious review, a FERC decision will generally be overturned only if FERC clearly exceeds its statutory authority, wholly fails to engage in ‘reasoned decision-making,’ or neglects to offer a rational explanation for its determinations.”
That’s not to say that Looper Bright will have no impact on FERC decisions. In the case of Order 1920, FERC Commissioner Mark Christie expects that a court will now have grounds to strike down the order, although Chairman Willie Phillips disagrees.
U.S. Electricity Prices are on the Rise
Recent analysis from the Bank of America Institute found that the year-over-year inflation rate for U.S. electricity prices reached 5.9% in May, up from 3.8% in January. Driving these cost increases are spikes in energy demand and consumption from AI, electric vehicles, and industrial onshoring driven by the IRA and CHIPS Act.
Reaching the supply/demand equilibrium, which will reduce costs for consumers, will require a concerted effort to build out transmission infrastructure, according to BoA. “This demand for significant investment in generation and related distribution infrastructure could be a headwind to consumers' utility bills for the foreseeable future.”
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Conversation Starters
Australia starts to consider nuclear power (Al Jazeera)
Conservative opposition leader Peter Dutton has said that he will greenlight nuclear power production if his Liberal and National Party coalition wins next year’s federal elections. Australia has had a ban on nuclear power since 1998.
Entergy Texas announces grid resiliency plan (T&D World)
The utility has filed an application with the Texas PUC for approval of Phase 1 of its resiliency plan which includes building stronger transmission infrastructure and implementing targeted vegetation management.
Clearway Energy begins repowering TX wind farm (Power Magazine)
Clearway has closed a financing round to repower the Cedro Hill wind farm in Webb County, Texas. Repowering will boost the wind farm’s capacity from 150 MW to 160 MW.
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