The court of appeals denied a petition. The court held that the Federal Energy Regulatory Commission’s market-based rate policy did not per se violate the Federal Power Act.
The Federal Energy Regulatory Commission (FERC) issued Order Number 697 in 2007 to codify its market-based rate policy. The order provided that sellers of wholesale electricity who elected to participate in the market-based policy would be pre-screened by FERC and would be required to show that they lacked (or had adequately mitigated) both horizontal (energy generation) and vertical (energy transmission) market power. After successfully navigating the screening process, a seller could be authorized by FERC to file a market-based rate, followed by the filing of an updated market-power analysis every three years.
