The sweeping regulatory reform implemented in Michigan over the past year is often couched as a response to the economic crisis. Decoupling rates from utility profits, the reasoning goes, will...
Commerce Clause Conflict
In-state green mandates face Constitutional challenges.
the environmental objectives and benefits of clean in-state generation. While electrons are fungible, the byproducts of the power plant factory (solid waste, air emissions, etc.) are not. A state that seeks new in-state renewable power plants may increase its reserve margins, improve its air quality, displace fossil-fuel based generation, avoid transmission congestion charges that may apply, and may also avoid or defer the need to build new transmission lines. All of these are defensible state policy objectives that can serve to defend against dormant Commerce Clause attacks.
The nation’s emerging commitment to renewable power is in its early stages. With or without a national consensus on climate change, a resource shift of this magnitude hits many of the major fault lines in the nation’s complicated energy policy: fuel choice, the costs and benefits of environmental improvement, the tension between federal and state authority over these decisions, and the unresolved national debate between a monopoly regulatory model and a competitive alternative. The TransCanada litigation is but one forum to begin to address issues that are more typically taken up by legislatures. Despite the murky judicial history of the Dormant Commerce Clause doctrine, there should be room for the court to resolve the collision in this suit between two meritorious social objectives: environmental improvement and fair competition.
1. 2008 Mass. Acts c.169.
2. TransCanada Power Marketing Ltd. v. Bowles , Civil Action No. 4:10-CV-40070-FDS (D Mass., filed Apr. 16, 2010) (“Complaint”).
3. Complaint at p. 15.
4. The Commerce Clause gives Congress the power “to regulate commerce . . . among the several States.” U.S. Const. art. I, § 8, cl. 3. The “Dormant Commerce Clause” doctrine is a judicially constructed negative corollary of the Commerce Clause that essentially “prevents a State from jeopardizing the welfare of the Nation as a whole by placing burdens on the flow of commerce across its borders that commerce wholly within those borders would not bear.” Am. Trucking Ass’ns v. Michigan Pub. Serv. Comm’n, 545 U.S. 429, 433 (2005) (quoting Oaklahoma Tax Comm’n v. Jefferson Lines, Inc., 514 U.S. 175, 180 (1995)).
5. American Wind Energy Association Year End 2009 Market Report (Jan. 2010)
6. The Public Utility Regulatory Policies Act of 1978, 16 U.S.C. §§ 2601-2645.
7. The American Recovery and Reinvestment Act of 2009, Pub. L. No. 111-5, 123 Stat. 115 (2009).
8. Am. Bus Ass’n. v. District of Columbia , [2 A.3d 203]; [2010 D.C. App. LEXIS 493] at *25 (D.C. 2010).
9. United Haulers Ass’n, Inc. v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U.S. 330 (2007) (internal quotation marks omitted).
10. See Granholm v. Heald , 544 U.S. 460 (2005).
11. See New Energy Co. of Indiana v. Limbach , 486 U.S. 269 (1988).
12. See Wyoming v. Oklahoma , 502 U.S. 437 (1992).
13. [Granholm, 544 U.S. at 489.]
14. Id. at 476 (internal quotation marks omitted).
15. See City of Philadelphia v. New Jersey , 437 U.S. 617, 628-629 (1978) (“[C]ertain quarantine laws have not been considered forbidden protectionist measures, even though they were directed against out-of-state commerce… [T]hose