NJ BPU Takes FERC To Court Over PJM Capacity Performance Approval
The New Jersey Board of Public Utilities last week ratified the filing of a Notice of Appeal to the United States Court of Appeals for the D.C. Circuit which challenges the decision of a divided Federal Energy Regulatory Commission (FERC) to deny rehearing of PJM’s Capacity Performance construct.
FERC denied rehearing by a 2-1 vote, with Chairman Bay dissenting.
A year ago, a divided FERC first approved PJM’s Capacity Performance construct. The initial approval also included a noteworthy dissent from Chairman Bay, the BPU said
"FERC has not examined whether approving the Capacity Performance construct makes financial sense for consumers," said Richard S. Mroz, President, New Jersey Board of Public Utilities.
In filing the appeal, the Board is joined by the American Public Power Association, the National Rural Electric Cooperative Association, and the Public Power Association of New Jersey.
In its denied request for rehearing, the BPU contended that FERC’s approval of the Capacity Performance construct was arbitrary and capricious. The Board’s challenge was based, in part, on FERC’s failure to adequately consider the costs and benefits associated with the construct and on a flawed penalty mechanism.