Supreme Court Hears Arguments on FERC’s Role with Demand Response

The Supreme Court of the United States is expected to hear oral arguments today in the appeal of a case initially filed by the Electric Power Supply Association which challenged the jurisdiction of the Federal Energy Regulatory Commission relative to demand response.  Specifically, the issue is about whether or not FERC has the right to determine compensation for demand response.

EPSA’s case against FERC’s jurisdiction was ruled on in a lower court and the U.S. Circuit Court of Appeals upheld the decision in favor of EPSA. However, FERC appealed to the U.S. Solicitor General who referred the case to the Supreme Court.

Order No. 745, which the FERC issued in 2011, requires grid operators to compensate electricity end- users for conserving power at peak times. Demand response customers get paid the same rate for conservation as utilities get paid for generating electricity.

The Supreme Court is not expected to make its ruling immediately. PJM is monitoring the case and its developments.