The U.S. Supreme Court soon will issue a potentially far-reaching decision in a case involving Duke Energy Corp. What’s the upside for the electric industry?
FIT in the USA
Constitutional questions about state-mandated renewable tariffs.
States should look to implement those elements of FITs that make them successful—namely investor security, low transaction costs and contract certainty—without treading into Constitutionally suspect waters.
Editor’s Note: This article was adapted, in part, from a more detailed article, “Fire & Ice,” published in volume 20 of the Duke Energy & Policy Forum (2010).
1. See Kenyan Ministry of Energy, Feed-in-Tariffs Policy for Wind, Biomass and Small Hydro Resource Generated Electricity (2008).
2. See Wilson H. Rickerson et al ., If the Shoe FITs: Using Feed-in Tariffs to Meet U.S. Renewable Electricity Targets , Electricity J ., May 2007, at 73, 73–74.
3. Anne Held et al., Feed-in systems in Germany, Spain and Slovenia: A comparison (2007).
4. Janet L. Sawin, National Policy Instruments: Policy Lessons for the Advancement & Diffusion of Renewable Energy Technologies Around the World 5 (2004).
5. See Wilson Rickerson & Robert C. Grace, The Heinrich Boll Found , The Debate over Fixed Price Incentives for Renewable Electricity in Europe and the United States: Fallout and Future Directions 1 (2007).
6. Ashley Seager, Green Power: Germany Sets Shining Example in Providing a Harvest for the World: Thanks to Tariff Guarantees, Germany Has 200 Times as Much Solar Energy as Britain , The Guardian , July 23, 2007, at 27.
7. Mark Landler, Germany Debates Subsidies for Solar Industries , N.Y. Times , May 16, 2008, at C1.
8. Bundesministerium für Umwelt, Naturchutz und Raktorsicherheit, Development of Renewable Energies in Germany in 2007 at 7 (2008) .
9. Ethan Howland, “Utilities, Solar Developers Should Seek New Procurement Approaches, Report Says,” Electric Utility Week , Dec. 15, 2008, at 28.
10. Paul Gipe, CEC Recommends Cost-Based Feed-in Tariff , Wind Works, Jan. 5, 2009 .
11. Paul Gipe, “Gainesville Moves Rapidly to True Solar Tariff,” Wind Works , Jan. 5, 2009.
12. Ucilia Wang, “Budget Shortfalls Could Shrink States’ Solar Incentives,” greentechsolar, Jan. 14, 2009 .
13. Federal Regulation and Development of Power (“Federal Power Act”) , 16 U.S.C. §§ 824d–e.
14. Pub. Util. Dist. No. 1 of Snohomish County Wash. v. Fed. Energy Regulatory Comm’n , 471 F.3d 1053, 1058 (9th Cir. 2006), vacated on other grounds , 547 F.3d 1081 (9th Cir. 2008)
15. Id. at 1066, aff’d, Morgan Stanley Capital Group v. Pub. Util. Dist. No. 1 of Snohomish County, Wash , 128 S.Ct. 2733 (2008). For a discussion of the California and Western energy crisis that spawned this litigation, see Ferrey, Soft Paths, Hard Choices: Environmental Lessons in the Aftermath of California’s Electric Deregulation Debacle , 23 Va. Envtl. L.J . 251 (2004)
16. N. States Power Co. v. Minn. Pub. Util. Comm’n , 344 N.W.2d 374, 378 (Minn. 1984).
17. Pub. Util. Dist. No. 1 , 471 F.3d at 1066; see also Entergy La., Inc., v. La. Pub. Serv. Comm’n, 539 U.S. 39, 47 (2003) (noting that the filed-rate doctrine applies to the states through federal preemption).
18. Nantahala Power & Light Co. v. Thornburg, 476 U.S. 953, 966–67 (1986); Miss. Power & Light Co. v. Miss.