Thread by @kdgscribe

THREAD: Listening to 3rd Circuit oral arguments over @pjminterconnect's scaled-back MOPR, which went into effect after @FERC commissioners split 2-2 on its legality.

This was one of my energy cases to watch in 2023. law360.com/articles/15552…

It's the third case of the day, so it could be a while until arguments begin.

And we're finally underway.

Circuit Judge Kent Jordan jumps into discussing supplemental filing arguing that @FERC effectively has 3 commissioners capable of acting on the MOPR, since @wlpFERC has previously recused himself and @Rich_Glick is no longer at FERC.

John Lee Shepherd Jr. of @HuntonAK, representing @EPSAnews and PJM Power Providers Group: "The relief we want is precise. FERC has not lawfully changed the rate previously set by FERC."

Judge Jordan pressing Shepherd to rebut @FERC's argument that power producers are effectively asking to declare the FPA amendment allowing split votes to be challenged in court "a nullity."

Shepherd: "What this statute does do is preserve everyone's rights as they were."

Judge Jordan: "How can it not change the status quo?PJM is doing something. You wouldn't be having FERC act if something wasn't being brought before it."

Circuit Judge Jane Roth says, "the APA does not overrule the specific provisions of FPA Section 205(g)."

John Shepherd of @HuntonAK: "There's nothing in the statute that says it precludes APA review."

Judge Jordan: "By that reasoning, you can never ever give effect to the deadlock, which the statute says, yes, you should give effect to it as an order."

Circuit Judge Peter Phipps wonders if court can review commissioners' individual statements to determine if they're APA-compliant.

John Shepherd of @HuntonAK: "I think that would be an incredibly bad idea. I think it would require a series of large leaps."

Judge Jordan suggests there's an argument in the background that Section 205(g) of the FPA is unconstitutional.

Judge Jordan: "This statute is unworkable and by definition unworkable because it purports to give power to the agency to act, when it can't because it's in deadlock."

John Shepherd of @HuntonAK acknowledges it never made that argument, but said it's a legally sounds one.

That doesn't seem like enough for other judges. Judge Phipps: "You've hated the legislation from the outset. Isn't it up to us to give it meaning within the bounds of a constitutional construction?"

Judge Roth: "I don't think we can rule on the constitutionality until you've briefed it."

Kriss Brown of Pa. PUC is up, says 3rd Circuit should review scaled-back MOPR.

Judge Jordan: "So you are asking us to become FERC? We should decide whether it was just and reasonable?"

Judge Roth: "How do you have standing to come before us and say that?"

Kriss Brown of Pa. PUC said that vacating and remanding the FERC order would be redressability.

That's echoed by Denise Goulet of @mccarterenglish, representing intervenors @OCC4Consumers.

Judge Jordan: "What's the legal rationale for doing that? Do you have one?"

@mccarterenglish @OCC4Consumers Judge Jordan suggests that court may ask for supplemental briefing on constitutionality of 2018 FPA amendment.

@FERC attorney Jared Fish said he can't think of an instance where a court has punted a case back to an agency with the hopes of resolving a split.

Jared Fish of @FERC: "There is no delegation past the agency [to PJM]"

Judge Jordan: "How can you say that?"

@FERC Judge Jordan goes back to 2018n law: "Is it constitutional? Can Congress declare that when agency can act when there isn't a majority, it will have been deemed to act?"

@FERC Jared Fish of @FERC said that's within the bounds of constitutionality. Judge Jordan suggests that Congress has essentially delegated authority to PJM.

@FERC Jared Fish of @FERC: "The framework that Congress set up here is not perfect...but it's a lot closer to typical APA review procedure than it might appear on first blush."

@FERC Matthew Price of @JennerBlockLLP, representing PJM and intervenors backing @FERC: "The court shouldn't be speculating on what the agency might do."

@FERC @JennerBlockLLP Matthew Price points out that @FERC let other tariff changes go into effect by simply doing nothing, pre the 2018 law change.

@FERC @JennerBlockLLP Matthew Price of @JennerBlockLLP on scaling back PJM MOPR to accommodate state #cleanenergy subsidies/preferences: "I just don't agree that every subsidy is distortionary."

Scott Strauss of @spiegelmcd, representing state agencies backing FERC: "PJM has a unilateral right to file a rate change. But they didn't do that alone and in a vacuum." Cites stakeholder process and stakeholder approval.

On rebuttal, John Shepherd of @HuntonAK said the only logical conclusion is that the APA trumps Section 205(g) of the FPA.

@HuntonAK And that's a wrap, after 2+ hours. Story TK.