Commissioner Mark C. Christie Statement
February 17, 2022
Docket No. ER20-1718-002
Order: E-2
I concur with the result, which is to approve NYISO’s tariff filing. I do not join the reasoning expressed in the order justifying that outcome.[1]
In constitutional law, reviewing courts frequently ask whether a challenged law or regulation is unconstitutional “on its face” or only “as-applied.”[2] The latter involves a close analysis of the unique factual record in the case and asks whether the law or regulation under challenge is being applied in a constitutional or unconstitutional manner, as opposed to asking the much broader question whether the law is facially unconstitutional, which would have far more sweeping implications.
While not a perfect analogy, here I believe that a fact-based, as-applied analysis of NYISO’s proposed tariff revisions under the Federal Power Act (FPA) makes acceptance of those revisions appropriate for the reasons I set forth below. The State of New York has enacted legislation that makes clear its preference for certain types of generating resources and its desire ultimately to push other, non-preferred, types of generation out of the resource mix entirely.[3] New York’s state law is discriminatory in its expressed preference for certain types of resources. Does this make the NYISO’s tariff revisions – through which NYISO is acting necessarily to accommodate the reality of New York’s laws – produce rates that are “unjust, unreasonable and/or unduly discriminatory” under the FPA? Under an “as-applied” analysis of this specific, single-state ISO filing by NYISO– and under a practical approach – I do not find it so.
We start with the proposition that each state in the United States has the sovereign authority, under its general police power, to choose the generating resources necessary to meet its own state’s power supply needs. The FPA does not contain any specific provision that pre-empts the states from exercising this authority, even if a state chooses to allow its utilities to enter an RTO. Further, FERC does not have the authority to order a state to build a certain type of generation resource, nor can FERC order a state to retire or ban certain types of resources. Congress has enacted no federal resource mandate nor given FERC the authority to enforce such a mandate, despite occasional legislative efforts to do so.
Here the record shows – and this is critically important to my analysis – that no one has suggested that this single-state ISO’s proposal to accommodate the resource decisions made by the New York legislature will harm consumers in other states. Thus, there being no evidence in this record that citizens of other states will be made to pay for New York’s policy decisions through the potential impacts of NYISO’s proposed tariff revisions, I conclude that any costs will be confined to New York. Based on the particular set of facts in this record, I do not find that the NYISO proposal “as-applied” results in rates that are “unjust, unreasonable and unduly discriminatory or preferential” under the FPA. If the people and businesses of New York do not like the impacts of their new state laws, their recourse is to the ballot box.
A similar analysis could well lead to a different outcome in a multi-state RTO, if the record showed that the RTO was implementing one state’s public policies as to preferred resources, and that implementation resulted in impacts being shifted to consumers in one or more other states in the multi-state RTO. Such impacts and cost-shifting in multi-state RTOs, if proven by the record, could well be unjust, unreasonable and unduly discriminatory or preferential under the FPA.
For these reasons, I respectfully concur.
[1] For example, I do not agree with what I believe to be certain unnecessarily overreaching language this order employs to support its finding.
[2] See, e.g., City of Los Angeles v. Patel, 576 U.S. 409, 415 (2015) (“A facial challenge is an attack on a statute itself as opposed to a particular application.”); Richard H. Fallon, Jr., Facial Challenges, Saving Constructions and Statutory Severability, 99 Tex. L. Review 215, 228 (2020) (“The terms are impossible to make wholly precise, but a rough cut will suffice for current purposes. In an as-applied challenge, a party maintains that the Constitution forbids a statute’s application to his or her case. In contrast, a facial challenge asserts that a statute – or, more commonly, a provision of a multipart statute – exhibits a defect that renders it invalid as applied to all cases, even if a more narrowly (or occasionally a more broadly) framed provision could have prohibited the challenger’s conduct.”) (footnote omitted).
[3] By way of example, as today’s order notes, the State of New York’s Climate Leadership and Community Protection Act requires that 70% of energy consumed in the State of New York be produced by renewable resources by 2030 and that all energy consumed in the State of New York be completely emissions free by 2040.