Court ruling involving Exelon Wind and the Public Utilities Commission of Texas

This important ruling by the Fifth Circuit Court of Appeals involves wind power and whether utilities are mandated under Public Utilities Regulatory Policies Act of 1978 (PURPA) to purchase the energy. In the ruling, the Court found that states have the right to limit the ability of renewable energy facilities to sell power under PURPA through long-term contracts unless the facilities can provide “firm power.”  This “firm power” requirement is a problem for renewable energy developers, in particular wind and solar. The ruling also reinforces the role of the States in their interpretation and implementation of the law. In this case, Exelon, which owns a number of operating wind energy facilities in Texas, argued that the utilitty was required under PURPA to sign long-term contracts to acquire the energy at prices ranging from $35 to $90/megawatt hour. The Court disagreed. A brief portion of the court's ruling is provided below. The full ruling can be accessed by clicking the links on this page.


This appeal addresses the Texas Public Utilities Commission’s (PUC) interpretation and implementation of a federal statutory and regulatory scheme governing the purchase of energy between public utilities and certain energy production facilities known as Qualifying Facilities. Appellees are qualifying wind generation facilities collectively known as Exelon that challenged a state rule and order which prohibited Exelon from forming Legally Enforceable Obligations when selling power. The district court determined that it had jurisdiction to hear Exelon’s claims and then granted summary judgment to Exelon. We disagree. We VACATE the portion of the judgment regarding Exelon’s challenge to the PUC’s order and direct the district court to dismiss for want of subject matter jurisdiction. As to the remaining claims challenging the PUC’s rule, we REVERSE and REMAND because the PUC acted within its discretion and properly implemented the federal regulation at issue here.

Exelov V Puc Tetal Document Pm 03

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SEP 8 2014
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