Ari Peskoe

The Federal Energy Regulatory Commission approved four separate orders to narrow exemptions of buyer-side mitigation (BSM) market rules in the New York Independent System Operator's (NYISO) capacity zones during Thursday's public meeting, which critics say will stifle the competitiveness of clean energy resources. The decisions would make it more difficult for new clean energy projects expected in the state to clear NYISO's capacity auction. Clean energy advocates say bidding into NYISO's capacity market is critical to the financial viability of projects like offshore wind and energy storage...Critics of the BSM have accused such subsidy-reducing actions of enabling fossil fuel plants to remain open despite plans for retirements. Within ISO-NE, the 448 MW Merrimack coal plant recently got an extended lease on life by clearing the capacity auction without trading, to get replaced by cleaner resources, in the substitution auction, also referred to as the CASPR secondary auction. "I think the fact that this old coal plant that barely operates is still in the market and didn't come out through the substitution auction highlights a deficiency in how the system is operating right now," Ari Peskoe, director of the Electricity Law Initiative at Harvard Law School told Utility Dive regarding the ISO-NE auction results.

If FERC does reverse itself and apply mitigation rules more broadly, it will have hampered clean energy participation in the three markets targeted by the Department of Energy’s 2017 grid resilience proposal, which would have provided ratepayer funded contracts to coal, nuclear and oil plants in those regions. FERC unanimously rejected that DOE plan in early 2018, but critics say the MOPR orders will do more to support fossil fuel plants because the price floors are more likely to withstand legal challenges than the poorly-designed DOE plan. States may not stand idly by. New York utility regulators already have a proceeding open that could pull them from the NYISO’s capacity market, putting the state in charge of long-term generation planning once again. “The more aggressive FERC Is on these issues, the more likely it will lead to the demise of the New York ISO capacity auction,” said Ari Peskoe, director of the Electricity Law Initiative at the Harvard Law School Environmental and Energy Law Program.

Settle in for a drawn-out legal battle over the Federal Energy Regulatory Commission's new plan for energy resource participation in the biggest electricity market in the country. Legal experts say potential lawsuits targeting FERC's recent "minimum offer price rule," or MOPR, for the PJM Interconnection capacity market will take awhile to get off the ground. FERC's commissioners have yet to say whether they will agree to a rehearing requested by dozens of state officials, environmental groups and some trade associations, and the agency could use tolling orders to further delay the process. But even if the timing of possible litigation is unclear, the legal arguments over the December order are already coming into focus...Under the new rule, for example, a nuclear power plant that receives state subsidies for reducing carbon emissions could be kicked out of PJM's capacity market. The subsidies are protected under state law and the courts, so ratepayers will continue to pay for them, but PJM would have to pretend those resources — in this example, nuclear power — do not exist, said Ari Peskoe, director of the Electricity Law Initiative at Harvard Law School. "Ratepayers end up overpaying because PJM will be procuring enough resources for the entire region," he said. "But at the same time, ratepayers will also be paying these resources outside the market through these state programs."

Clean energy advocates have issued numerous warnings that a controversial December decision by federal regulators to raise the floor price for state-subsidized resources bidding in the PJM Interconnection's capacity market would harm the ability of new clean energy technologies to enter the market. But options to challenge the order from the Federal Energy Regulatory Commission in court are extremely limited. Stakeholders from the grid operator to confectioner Hershey have filed requests with FERC for a rehearing of the Dec. 19 order, but language in the Federal Power Act shields regulators from litigation when they delay responses to such requests...However, it's become a norm for FERC to delay, or toll, rehearing requests received on its orders, according to several attorneys... "There's been a lot of grumbling about FERC's practices of sitting on these rehearing requests," Ari Peskoe, director of Harvard University's Electricity Law Initiative, told Utility Dive.

A pair of energy-producing states may face ideological challenges in their quest for a high court review of Washington state's blockade against the last major coal export project on the West Coast. Wyoming and Montana argued in a Supreme Court petition yesterday that Washington regulators violated constitutional protections on interstate commerce when they denied a Clean Water Act permit for the Millennium Bulk Terminals project in Longview, Wash. ... Justices for the Supreme Court will be more interested in evaluating Washington's denial of the terminal's Clean Water Act permit, rather than any alleged intent to further control global greenhouse gas emissions, said Ari Peskoe, director of the Electricity Law Initiative at Harvard Law School. He said the states' claims of discrimination are weak because they compare support for different products: apples versus coal.

FERC’s December order to exclude wind, solar and nuclear power from part of its largest electricity market is drawing support from several largely fossil fuel power producers that argue the decision won’t hobble the growth of renewable energy even as it boosts coal and gas plants. FERC last month voted to set a price floor that will effectively exclude renewable and nuclear sources that receive state support from the PJM capacity market. Environmentalists lambasted the order as an attack on clean energy and a bailout for fossil fuels, but its supporters say the effects on wind and solar — which were only about 1 percent of the capacity cleared in PJM’s last auction — will be minimal...Regardless of whether FERC grants a rehearing, renewable energy companies and environmentalists are likely to challenge the order in court, arguing it violates state jurisdiction over power plant siting and contending that FERC acted in an “arbitrary and capricious” manner because it did not consider the potential costs to consumers when crafting the order. “There are lots of opportunities for 'arbitrary and capricious' challenges,” said Ari Peskoe, director of the Harvard Electricity Law Initiative, including FERC’s broad definition of which subsidies will qualify for the price floor, and why FERC did not include an option for individual plants to opt out of the capacity market. “Rehearing request deadline is next Tuesday. We’ll have a better picture of the legal arguments then.”

Dominion Energy said Tuesday it selected Siemens Gamesa to supply offshore wind turbines for its 2,600-MW installation off the coast of Virginia, but the project's economics could be challenged if the wind farm is excluded from PJM Interconnection's capacity market. Dominion described the decision made through a competitive solicitation as a "significant milestone" in what is currently the largest proposed offshore wind project in the US. The wind farm will be constructed 27 miles off the coast of Virginia Beach and is scheduled to be completed by 2026, according to a statement.... "Most PJM states require utilities to meet renewable energy targets or support specific clean energy resources, such as nuclear plants or yet-to-be-constructed offshore wind farms," Ari Peskoe, Director of the Electricity Law Initiative at Harvard's Environmental and Energy Law Program, said in a blog post Tuesday. "Some of these programs could become more expensive, as clean energy resources that are unable to earn PJM capacity revenue seek additional ratepayer support," Peskoe said.

Federal energy regulators issued an order Thursday that likely will tilt the market to favor coal and natural gas power plants in the nation's largest power grid region, stretching from New Jersey to Illinois. Critics say that it effectively creates a new subsidy to prop up uneconomical fossil fuel plants and that it will hurt renewable energy growth and, ultimately, consumers. The new rules, approved by the Federal Energy Regulatory Commission, are designed to counteract state subsidies that support the growth of renewable energy and use of nuclear power. The rules involve what are known as "capacity markets," where power plants bid to provide electricity to the grid. The change would require higher minimum bids for power plants that receive such subsidies, giving fossil fuel plants an advantage...Ultimately, consumers will pay several times over, said Ari Peskoe, director of the Electricity Law Initiative at Harvard Law School. "The major loser here is consumers," he said.

Democratic presidential candidates are promising to fight climate change, but whether they succeed will hinge on their ability to shape an obscure federal agency that has overseen an explosion of fossil fuel infrastructure over the last few decades. The FERC, an independent regulator of pipelines and power markets, derives its authority from decades-old laws that largely predate worries about climate change and were focused primarily on ensuring that energy supplies remain cheap and reliable. But that mandate may interfere with some of the more aggressive climate plans Democrats are contemplating, and candidates are facing pressure to overhaul the agency if elected... “I could imagine doing [climate legislation] in such a way where you don’t need to reform FERC,” said Ari Peskoe, Director of the Harvard Electricity Law Initiative. “If there was just a national [renewable energy standard], you would just need someone to make sure utilities are complying. That could be FERC, but it could also be [the Department of Energy] or EPA as well.”

In recent years, the Northeast region has discussed matching state-driven climate ambitions with ISO-NE's market design. States are working to deploy greater amounts of renewable resources, and a group of U.S. senators from New England wrote ISO-NE about the adoption of renewable energy in the region on Nov. 18. Their letter came after many renewables advocates and states in the region were dismayed to see federal regulators allow a fuel capacity rule go into effect in ISO-NE... "It is not easy to engage on these issues, they're very technical," Ari Peskoe, director of Harvard University's Electricity Law Initiative, told Utility Dive. "A first step is just making people aware of the existence of this organization."

U.S. power industry stakeholders were sharply divided on the Federal Energy Regulatory Commission's proposal to relax its rules implementing the Public Utility Regulatory Policies Act, a more than 40-year-old law that requires electric utilities to buy power from cogeneration and small renewable energy plants. ... Meanwhile, comments submitted by Harvard University's Electricity Law Initiative argued that the NOPR "pays lip service" to PURPA's requirement that the commission issue rules it "determines necessary to encourage" the development of QFs. "The commission suggests that in response to industry changes it may divorce the statute from its plain meaning and issue rules that will restrain QF growth," Harvard said. "But Congress's mandate to the commission is not contingent on industry conditions and does not expire."

Coal executive Bob Murray is raising money for President Trump's reelection — and he may want a few things in return. Murray, an unabashed promoter of coal, said during an interview he again offered the president a list of policy suggestions and talking points to revive the dying coal industry at a private fundraiser Wednesday evening. Among his demands, Murray repeatedly called on the president to fix the Federal Energy Regulatory Commission...Told of Murray's comments, Ari Peskoe, director of Harvard Law School's Electricity Law Initiative, said, "If this is all Bob Murray's got, then he's got nothing." The 10th Amendment of the U.S. Constitution says that "the federal government can't commandeer state officials," Peskoe said. "So Congress could not outright demand that PUCs conduct proceedings that will result in payments to coal plants," nor could FERC as he reads the Federal Power Act.

It looks like Northern Pass is really dead this time: The New Hampshire Supreme Court on Friday upheld the project’s rejection last year by the state Site Evaluation Committee. “We have reviewed the record and conclude that the Subcommittee’s findings are supported by competent evidence and are not erroneous as a matter of law,” Associate Justice Anna Barbara Hantz Marconi wrote in the unanimous decision. The ruling leaves no obvious way forward for the 192-mile transmission line carrying almost a Seabrook Station’s worth of electricity down from Quebec hydropower plants, ending almost a decade of often-contentious debate. “Really hard to beat the state in court on a siting denial,” wrote Ari Peskoe, director of the Electricity Law Initiative at Harvard Law School, in response to the ruling.

It looks like Northern Pass is really dead this time: The New Hampshire Supreme Court on Friday upheld the project’s rejection last year by the state Site Evaluation Committee. “We have reviewed the record and conclude that the Subcommittee’s findings are supported by competent evidence and are not erroneous as a matter of law,” Associate Justice Anna Barbara Hantz Marconi wrote in the unanimous decision. The ruling leaves no obvious way forward for the 192-mile transmission line carrying almost a Seabrook Station’s worth of electricity down from Quebec hydropower plants, ending almost a decade of often-contentious debate. ... “Really hard to beat the state in court on a siting denial,” wrote Ari Peskoe, director of the Electricity Law Initiative at Harvard Law School, in response to the ruling.

The future of the U.S. power grid may ride in part on an obscure tussle over transmission in the Lone Star State. Front and center is a new law in Texas — enacted as S.B. 1938 — that gives incumbent utilities first dibs on building new transmission lines. Critics say the measure effectively cuts out new entrants, clashes with the state's history of competition and could raise the costs of transmission projects that factor into consumers' power bills. Proponents counter that the language preserves Texas' approach to electricity and should help ensure reliability and affordability..."As competitive transmission expands, it's certainly plausible that other utilities will go to their state legislatures and ask for this kind of protection," said Ari Peskoe, director of Harvard Law School's Electricity Law Initiative

While other states are embracing renewable energy, Ohio is heading in the opposite direction. A bill passed this week by the Ohio House would subsidize nuclear and coal power while cutting state support for renewable energy and energy efficiency, with the utilities' customers footing the bill.. The Ohio bill begins to make sense only as a bailout for one company as opposed to comprehensive energy plan, said Ari Peskoe, director of the Electricity Law Initiative at Harvard Law School. That company is FirstEnergy Solutions, the owner of the state's only two nuclear plants and the leading architect of the bill. It's a subsidiary of Akron-based FirstEnergy that FirstEnergy is in the process of spinning off..."FirstEnergy has really been a failure in the generation business, and so it's been looking for a bailout," Peskoe said.

The United States' largest interstate electricity market will soon hold a multibillion-dollar auction to determine which power plants will supply it in the years to come. But more than six months after FERC tossed out the rules PJM had planned for the capacity market over the fairness of nuclear subsidies, federal regulators have yet to approve a rewrite — leaving some power players on edge ... Others are less concerned FERC will alter the results of the auction even if it proceeds under the invalidated rules. Ari Peskoe, director of the Harvard Electricity Law Initiative, said the commission typically avoids issuing refunds in wholesale power markets and is unlikely to order the auction be re-run. The most probable conclusion, he said, is that PJM runs its auction under invalidated rules this year, and then FERC approves new rules PJM proposed last year ahead of next year's auction.

The Supreme Court yesterday rejected challenges that aimed to dismantle nuclear subsidies in Illinois and New York. By declining a pair of challenges filed by the Electric Power Supply Association (EPSA), the justices preserved two appellate court rulings upholding the states' zero-emission credit (ZEC) policies. Other states with an interest in developing their own incentive programs now have a legally tested blueprint for doing so, legal experts said yesterday. "EPSA asked the Court to expand preemption under the Federal Power Act, a move that might have threatened state renewable energy programs and could have jumpstarted a wave of litigation," Ari Peskoe, director of Harvard Law School's Electricity Law Initiative, wrote after the Supreme Court's order denying review. "Today's denials underscore that states have broad legal authority to enact programs that pay clean energy generators for their production of zero-emission energy."

It’s been more than a year since the Trump administration declared that coal and nuclear retirements were threatening the electric grid -- and regulators still aren’t rushing to the rescue. ... “The political winds that created this docket -- I don’t know if they’re still blowing or not," said Ari Peskoe, director of the Electricity Law Initiative at Harvard University.

The U.S. president has joined Kentucky's governor and the coal state's U.S. senators in trying to pressure the Tennessee Valley Authority to keep a 49-year-old coal-fired power plant operating, even though the nation's largest public electric utility has concluded that the plant is unreliable, no longer needed and too expensive to repair and operate. ... What study the governor was referring to isn't clear, said Ari Peskoe, director of the Electricity Law Initiative at the Harvard Law School, who follows FERC proceedings.

America's first major offshore wind project is caught in a crosswind. The Federal Regulatory Energy Commission declined this week to rule on a waiver that would have eased the wind developer's entry into New England's electricity market. The decision, or lack thereof, prompted an unusual round of public sniping among FERC commissioners on Twitter and highlights the simmering tensions in New England, where state climate ambitions are straining against the structure of the region's wholesale electricity markets. ... But it's a fragile compromise. In many ways, the disagreement over Vineyard Wind's waiver is best understood as a fight over money, said Ari Peskoe, who leads Harvard Law School's Electricity Law Initiative. He pointed to a New England Power Generators Association filing with FERC this week, in which the power plant owners argued that Vineyard Wind's participation in the auction would prompt total market revenues to fall by $270 million. For the wind developer, on the other hand, the capacity auction represents an additional revenue stream outside its state contract.