Justia Energy, Oil & Gas Law Opinion Summaries

This case involves Duke Energy Progress, LLC, a grid operator, and two energy generation companies, American Beech Solar, LLC, and Edgecombe Solar LLC. The dispute centers around two orders by the Federal Energy Regulatory Commission (FERC). The first order rejected Duke Energy's agreement with American Beech Solar, which did not require Duke Energy to reimburse the cost of network upgrades. The second order accepted Duke Energy's agreement with Edgecombe Solar, which Duke Energy filed unsigned and under protest, and required Duke Energy to reimburse the cost of network upgrades.In the lower courts, FERC rejected the agreement with American Beech Solar, arguing that it was not just and reasonable because Duke Energy had threatened to delay construction of the upgrades, preventing American Beech from connecting to the grid, unless American Beech agreed to forego reimbursement. FERC also approved the agreement with Edgecombe Solar, despite Duke Energy's protest that it should not be required to pay reimbursements.In the United States Court of Appeals for the District of Columbia Circuit, the court denied Duke Energy's petitions for review. The court held that FERC's orders were not arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law. The court found that FERC's interpretation of its own regulation, Order 2003, was reasonable and entitled to deference. The court also found that FERC reasonably rejected Duke Energy's request for a deviation from the reimbursement requirement. Finally, the court held that FERC's orders did not violate the principle of treating similarly situated utilities differently without a reasonable justification. View "Duke Energy Progress, LLC v. Federal Energy Regulatory Commission" on Justia Law

The case involves Transcontinental Gas Pipe Line Company, LLC (Transco), a natural gas company that sought to abandon and expand its pipeline facilities in Pennsylvania and New Jersey. To do so, Transco needed a Certificate of Public Convenience and Necessity from the Federal Energy Regulatory Commission (FERC), which it obtained. However, the certificate was subject to conditions, including that Transco receive three additional permits from the Pennsylvania Department of Environmental Protection (PADEP). After receiving these permits, Transco began its pipeline project. However, three environmental advocates filed an administrative appeal with the Environmental Hearing Board (EHB) challenging PADEP's issuance of the permits. In response, Transco initiated a lawsuit in the District Court seeking to enjoin the administrative appeal, arguing that the Natural Gas Act preempts the state law allowing the appeal.The District Court rejected Transco's preemption arguments and denied its motion for a preliminary injunction. Transco appealed this decision to the United States Court of Appeals for the Third Circuit. The Court of Appeals affirmed the District Court's decision, finding that none of the theories of preemption advanced by Transco or the state agency applied in this case. The Court held that the Natural Gas Act does not expressly preempt administrative appeals to the EHB, nor does it field preempt such appeals. The Court also found that the possibility of multiple challenges in different fora to PADEP permitting decisions under the Clean Water Act for interstate natural gas pipelines does not impose an obstacle to the purposes of the Natural Gas Act. Therefore, the Court concluded that Transco's motion for a preliminary injunction was correctly denied. View "Transcontinental Gas Pipe Line Co LLC v. Pennsylvania Environmental Hearing Board" on Justia Law

The case involves a dispute over the award of black lung benefits to the surviving wife of the late Bruce E. Goode, who worked for American Energy as a coal miner and suffered from a severe chronic obstructive pulmonary disability. American Energy disputed the cause of his impairment, arguing that it was due to his long-term cigarette smoking, not his coal mine employment. An administrative law judge (ALJ) found that Mr. Goode’s disability arose from his coal mine employment and awarded black lung benefits. The Benefits Review Board affirmed the award.American Energy appealed, arguing that the ALJ applied an incorrect legal standard. The company contended that the Black Lung Benefits Act and its implementing regulations require a miner to prove that coal dust caused the lung disease or made it worse. American Energy argued that the ALJ reversed the burden of proof by finding that the company had not proven why Mr. Goode’s lung disease was not at least partially due to coal dust exposure.The United States Court of Appeals for the Fourth Circuit agreed that the ALJ applied the wrong legal standard in determining that Mr. Goode had legal pneumoconiosis. However, the court noted that the ALJ also concluded that Mr. Goode’s clinical pneumoconiosis entitled him to benefits. The court granted American Energy’s petition and vacated and remanded the Board’s order for further proceedings. View "American Energy, LLC v. Director, Office of Workers' Compensation Programs" on Justia Law

The case involves Ammonite Oil & Gas Corporation (Ammonite) and the Railroad Commission of Texas and EOG Resources, Inc. (EOG). Ammonite leases mineral rights beneath a riverbed from the State of Texas. EOG leases the minerals on the land adjoining the river on both sides. All the minerals in the area lie in a common subsurface reservoir. EOG's wells, however, do not reach the minerals beneath the riverbed. Ammonite argued that without pooling, its minerals are left stranded. Ammonite applied to the Railroad Commission for forced pooling under the Texas Mineral Interest Pooling Act (MIPA).The Railroad Commission rejected Ammonite's applications to force-pool the minerals beneath the river—which are not being produced—with those beside it—which are. The lower courts affirmed the Commission’s order. The Supreme Court of Texas also affirmed the lower courts' decisions but for different reasons than the court of appeals gave.The Supreme Court of Texas held that the Commission’s conclusion that “Ammonite failed to make a fair and reasonable offer to voluntarily pool as required by [MIPA Section] 102.013” is reasonable. The court also held that Ammonite has failed to show that forced pooling of its acreage with EOG’s wells is necessary to prevent its minerals from ultimately being lost. The court concluded that Ammonite applied for a share of EOG’s revenue without contributing to it and that the Commission’s conclusion that forced pooling would not prevent waste or protect correlative rights is not unreasonable. View "AMMONITE OIL & GAS CORPORATION v. RAILROAD COMMISSION OF TEXAS" on Justia Law

The case involves Husky Marketing & Supply Company and Phillips 66 Company, two customers of a crude-oil pipeline, who petitioned for review of orders issued by the Federal Energy Regulatory Commission (FERC) approving the pipeline’s application to charge market-based rates for its shipping services. The petitioners argued that the Commission adopted an arbitrary and capricious definition of the relevant geographic destination market for the pipeline’s services when analyzing whether it had market power.Previously, the matter was referred to an administrative law judge (ALJ) who, after an evidentiary hearing, found the correct destination market was the narrower Wood River market advanced by Husky and Phillips, rather than the broader St. Louis BEA Economic Area advanced by Marathon. Both Marathon and the Petitioners filed exceptions to the ALJ’s decision. The Commission unanimously reversed the ALJ’s decision and concluded the correct geographical destination market was Wood River together with Patoka, Illinois.The United States Court of Appeals for the District of Columbia Circuit reviewed the FERC’s orders under the “arbitrary and capricious” standard. The court held that the FERC did not act arbitrarily or capriciously when it concluded Wood River and Patoka together, rather than Wood River alone, represent the area in which a shipper may rationally look for transportation service. The court also held that the FERC was not required to perform any additional empirical analysis in this case. Therefore, the petitions for review were denied. View "Husky Marketing and Supply Company v. FERC" on Justia Law

The case involves an appeal by Marmen Inc., Marmen Énergie Inc., Marmen Energy Co., the Government of Québec, and the Government of Canada against a decision by the U.S. Department of Commerce. The Department of Commerce had imposed countervailing duties on imports of certain utility scale wind towers from Canada, arguing that the Canadian government had provided illegal subsidies to the producers and exporters of these towers.The case was initially reviewed by the United States Court of International Trade, which upheld the Department of Commerce's decision. The appellants then appealed to the United States Court of Appeals for the Federal Circuit.The appellants argued that the Department of Commerce had erred in its assessment of three government programs and its computation of the sales denominator used to calculate the subsidy rate. They contended that the subsidy rate should have been de minimis, meaning it was too trivial or minor to merit consideration.The Court of Appeals for the Federal Circuit affirmed the judgment of the U.S. Court of International Trade, ruling that the Department of Commerce's determination was supported by substantial evidence and was in accordance with the law. The court rejected the appellants' arguments, finding that the Department of Commerce had reasonably determined that the auditor's adjustment was unreliable, and that the three subsidy programs at issue did provide countervailable subsidies. View "GOVERNMENT OF QUEBEC v. US " on Justia Law

The case involves the Michigan Attorney General's attempt to shut down Enbridge’s Line 5 Pipeline, which runs underwater across the Straits of Mackinac between Michigan’s Lower and Upper Peninsulas. The Attorney General filed the case in Michigan state court in 2019, alleging violations of three state laws. Enbridge responded by moving for summary disposition, arguing that the complaint failed to state a claim on which relief could be granted. The state court held oral argument on those dispositive motions, focusing on preemption issues, including whether the Attorney General’s claims were preempted by either the Pipeline Safety Act or the federal Submerged Lands Act.In 2020, Michigan Governor Gretchen Whitmer issued a notice of revocation of the 1953 easement, calling for Line 5 to be shut down by May 2021, and simultaneously filed a complaint in state court to enforce the notice. Enbridge timely removed the Governor’s case to the United States District Court for the Western District of Michigan. The district court denied the Governor’s motion to remand, holding that it had federal-question jurisdiction. The Governor subsequently voluntarily dismissed her case.Enbridge removed the Attorney General’s case to federal court in December 2021, citing the district court’s order denying the motion to remand in the Governor’s case. The Attorney General moved to remand this case to state court on grounds of untimely removal and lack of subject-matter jurisdiction. The district court denied the motion on both grounds, excusing Enbridge’s untimely removal based on equitable principles and estopping the Attorney General from challenging subject-matter jurisdiction.The United States Court of Appeals for the Sixth Circuit reversed the district court's decision, holding that Enbridge failed to timely remove the case to federal court under 28 U.S.C. § 1446(b), and there are no equitable exceptions to the statute’s deadlines for removal. The case was remanded to Michigan state court. View "Nessel v. Enbridge Energy, LP" on Justia Law

The case involves a dispute over the Federal Energy Regulatory Commission's (FERC) approval of a project to expand a natural-gas pipeline from western Pennsylvania to the New York metropolitan area. The petitioner, Food & Water Watch, argued that FERC overlooked environmental issues in approving the project. Specifically, they claimed that FERC's Environmental Impact Statement failed to quantify greenhouse-gas emissions from upstream drilling for the extra gas, to quantify ozone emissions from its downstream burning, and to categorize emissions impacts as either significant or insignificant. Additionally, Food & Water Watch argued that FERC did not adequately consider New York State and New York City laws mandating reductions in carbon-dioxide emissions.The case was reviewed by the United States Court of Appeals for the District of Columbia Circuit. The lower courts had approved the project, with FERC issuing a certificate of public convenience and necessity for the East 300 Upgrade Project. FERC had prepared a full Environmental Impact Statement (EIS), which estimated the downstream carbon-dioxide emissions but declined to address upstream environmental effects. FERC also declined to characterize downstream emissions as significant or insignificant.The Court of Appeals for the District of Columbia Circuit rejected the petitioner's contentions and denied the petitions for review. The court found that FERC had reasonably concluded that there was too much uncertainty regarding the number and location of additional upstream wells. The court also held that FERC had reasonably explained its decision not to give a quantitative estimate of how much ozone would be produced as a result of the project. Finally, the court found that FERC had amply discussed the significance of GHG emissions and that it was not required to label the increased emissions and ensuing costs as either significant or insignificant. The court also found that FERC had reasonably explained why the New York State Climate Leadership and Community Protection Act did not undercut its finding of need for the project. View "Food & Water Watch v. Federal Energy Regulatory Commission" on Justia Law

The case revolves around the Public Utility Commission of Texas (PUC) and two market participants, RWE Renewables Americas, LLC and TX Hereford Wind, LLC. Following Winter Storm Uri, the Legislature amended the Public Utility Regulatory Act (PURA) to require that protocols adopted by the Electric Reliability Council of Texas (ERCOT) must be approved by the PUC before they take effect. ERCOT then adopted a revision to its protocols, which was approved by the PUC, setting the price of electricity at the regulatory maximum under Energy Emergency Alert Level 3 conditions. RWE challenged the PUC's approval order in the Third Court of Appeals, arguing that the order was both substantively and procedurally invalid.The Third Court of Appeals held that the PUC's order was both substantively invalid—because the PUC exceeded its statutory authority by setting the price of electricity—and procedurally invalid—because the PUC failed to comply with the Administrative Procedure Act’s rulemaking procedures in issuing the order.The Supreme Court of Texas reviewed the case and held that the PUC’s approval order is not a “competition rule[] adopted by the commission” subject to the judicial-review process for PUC rules. The court found that PURA envisions a separate process for ERCOT-adopted protocols, and the statutory requirement that the PUC approve those adopted protocols does not transform PUC approval orders into PUC rules eligible for direct review by a court of appeals. Therefore, the Third Court of Appeals lacked jurisdiction over this proceeding. The Supreme Court of Texas vacated the court of appeals’ judgment and dismissed the case for lack of jurisdiction. View "Public Utility Commission v. RWE Renewables Americas, LLC" on Justia Law

The Supreme Court of New Mexico affirmed the decision of the New Mexico Public Regulation Commission (PRC) to deny Southwestern Public Service Company’s (SPS) application for a financial incentive under the Renewable Energy Act (REA). SPS had proposed to retire renewable energy certificates (RECs) earlier than required to exceed the Renewable Portfolio Standard (RPS), and in return, requested a rate rider that would allow it to charge customers one dollar for each REC retired over the twenty percent standard. The PRC denied the application, finding that SPS’s proposal did not meet the REA’s requirement to “produce or acquire renewable energy” to qualify for an incentive. The court agreed with the PRC’s interpretation of the REA, stating that the act of retiring RECs alone does nothing to further the statute’s objectives. The court also rejected SPS’s challenges to the PRC’s amendments to Rule 572, which governs the award of incentives under the REA. The court found that the amendments did not exceed the scope of the REA, were not arbitrary or capricious, and were not otherwise unreasonable or unlawful. View "S.W. Pub. Serv. Co. v. N.M. Pub. Regul. Comm'n" on Justia Law