October 18, 2021

Volume XI, Number 291

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October 18, 2021

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Democratic Lawmakers Seek FERC’s Rejection of Net Metering Proposal

Democratic lawmakers recently submitted a letter urging the Federal Regulatory Commission (FERC) to reject a petition for declaratory order filed by the New England Ratepayers Association (NERA) that could impact state-run net metering programs. 

In its petition, NERA seeks to overturn the jurisdictional parameters of Full Net Metering and convert it from a state-regulated retail transaction to a wholesale transaction with federal oversight by FERC.  Currently, Full Net Metering is a widespread practice in 45 states under which an electricity customer that produces more energy from a generation source (i.e. solar panels) than it uses can deliver the excess electricity to the interconnected utility grid in exchange for credits or offsets on the customer’s electricity bill.

Specifically, NERA believes that when excess energy is delivered to the local utility for resale to the utility’s retail customers, the transactions become wholesale sales in interstate commerce.  Additionally, NERA asserts that customers who deliver energy to the interconnected utility as part of a Full Net Metering program are generally paid a price for energy that is three to five times greater than the applicable wholesale rate, while shifting the fixed costs of utilizing the transmission system to other customers of the interconnected utility.

If FERC grants NERA's petition, the pricing of Forward Net Metering transactions may be decided under the Federal Power Act (FPA) or the Public Utility Regulatory Policies Act (PURPA), which could have the effect of changing the economic benefits expected under state-specific Full Net Metering programs.

In a May 26, 2020 letter to FERC, 24 Democratic U.S. senators and representatives argued that granting NERA’s request would upend the long-held tradition that retail level transactions involving end-user electricity customers fall under the jurisdiction of the states. The lawmakers also requested that NERA disclose the identities of the 12 entities that funded NERA’s petition.

FERC has requested that comments on NERA’s petition be filed by June 15, 2020. 

©2021 Pierce Atwood LLP. All rights reserved.National Law Review, Volume X, Number 156
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About this Author

Andrew Kaplan Energy Attorney
Partner

Andrew Kaplan focuses his practice on providers of energy storage, demand response, ancillary services, and electricity and gas transmission and supply, both in the wholesale and retail markets. He regularly represents clients before the Federal Energy Regulatory Commission (FERC) and Independent System Operators/Regional Transmission Operators (NYISO, ISO-NE, PJM, Midcontinent ISO, California ISO, SPP and ERCOT), and many state public utility commissions. Andrew has won significant rulings before FERC that helped to pave the way for growth among leaders in the energy storage industry....

617-488-8104
Sarah Tracy Energy Generation Attorney Pierce Atwood LLP
Partner

Sarah advises energy generation facilities and industrial and large commercial energy users with respect to energy and regulatory issues and due diligence matters.  Sarah also represents electric, natural gas, and telecommunications utilities before state regulatory entities. 

Sarah assists energy project owners and developers with due diligence in connection with energy infrastructure acquisitions and negotiates key energy agreements, including power purchase agreements, natural gas supply agreements and firm gas transportation agreements, and renewable energy credit purchase and...

207-791-1299
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