PRECEDENTIAL

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

 

Nos. 21-3068, 21-3205 & 21-3243

____________

PJM POWER PROVIDERS GROUP,

Petitioner in No. 21-3068

v.

FEDERAL ENERGY REGULATORY COMMISSION

___________________________

ELECTRICAL POWER SUPPLY ASSOCIATION,

 Petitioner in No. 21-3205

v.

FEDERAL ENERGY REGULATORY COMMISSION

___________________________
2 

PENNSYLVANIA PUBLIC UTILITY COMMISSION;

PUBLIC UTILITIES COMMISSION OF OHIO,

 Petitioner in No. 21-3243

v.

FEDERAL ENERGY REGULATORY COMMISSION

 

On Petition for Review of an Order of the

Federal Energy Regulatory Commission

(FERC No. ER21-2582-000) 

 

Argued on January 10, 2023 

 

Before: JORDAN, PHIPPS and ROTH, Circuit Judges

(Opinion filed: December 1, 2023)

Elbert Lin 

Charles D. Wallace, III

Hunton Andrews Kurth

951 East Byrd Street

Riverfront Plaza East Tower

Richmond, VA 23219

John L. Shepherd, Jr. (ARGUED)

Hunton Andrews Kurth

2200 Pennsylvania Avenue, NW

Washington, DC 20037

 Counsel for Petitioner PJM Power Providers 

 Group
3

Paul W. Hughes

McDermott Will & Emery

500 N Capitol Street, NW

Washington, DC 20001

Counsel for Petitioner Electric Power Supply 

Association

Kriss E. Brown (ARGUED)

Christian A. McDewell

Pennsylvania Public Utility Commission

Commonwealth Keystone Building

400 N Street

PO Box 3265

Harrisburg, PA 17120

Counsel for Petitioner Pennsylvania Public 

Utility Commission

Thomas G. Lindgren

Werner L. Margard, III

Office of Attorney General of Ohio

30 East Broad Street

26th Floor

Columbus, OH 43215

Counsel for Petitioner Public Utilities 

Commission of Ohio
4

Jeffrey W. Mayes

Monitoring Analytics

2621 Van Buren Avenue

Suite 160

Eagleville, PA 19403

Counsel for Intervenor Petitioner Monitoring 

Analytics LLC

Denise C. Goulet (ARGUED)

McCarter & English

1301 K Street, NW

Suite 1000 West

Washington, DC 20005

Counsel for Intervenor Petitioner Office of the 

Consumer Counsel State of Ohio OCC

Jared B. Fish (ARGUED)

Federal Energy Regulatory Commission

888 First Street NE

Washington, DC 20426

Counsel for Respondent

Danielle C. Fidler

Earthjustice Legal Defense Fund

1001 G Street, NW

Suite 1000

Washington, DC 20001

Counsel for Intervenor Respondents Union of 

Concerned Scientists and Sierra Club
5

Peter Hopkins

Amber L. Martin Stone

Jeffrey A. Schwartz

Scott H. Strauss (ARGUED)

Cynthia Bogorad

Lauren L. Springett

Spiegel & McDiarmid

1875 Eye Street, NW

Suite 700

Washington, DC 20006

Counsel for Intervenor Respondents Delaware 

Division of Public Advocate; Maryland Office 

of Peoples Counsel; New Jersey Division of 

Rate Counsel and Office of Peoples Counsel for 

the District of Columbia

Matthew Price (ARGUED)

Jenner & Block

1099 New York Avenue, NW

Suite 900

Washington, DC 20001

Counsel for Intervenor Respondents 

Constellation Energy Corp and Constellation 

Energy Generation LLC
6

Miles H. Mitchell

Maryland Public Service Commission

6 St. Paul Street

6 St. Paul Centre, 16th Floor

Baltimore, MD 21202

Counsel for Intervenor Respondent Maryland 

Public Service Commission

David C. Apy

Office of Attorney General of New Jersey

Division of Law

25 Market Street

Hughes Justice Complex

Trenton, NJ 08625

Counsel for Intervenor Respondent New Jersey 

Board of Public Utilities

Robert A. Weishaar, Jr.

McNees Wallace & Nurick

1200 G Street, NW

Suite 800

Washington, DC 20005

Counsel for Intervenor Respondent PJM 

Industrial Customer Coalition
7

Ryan J. Collins

Paul M. Flynn

Wright & Talisman

1200 G Street, NW

Suite 600

Washington, DC 20005

Counsel for Intervenor respondent PJM 

Interconnection LLC

Caroline Reiser

Natural Resources Defense Council

1152 15th Street, NW

Site 300

Washington, DC 20005

Counsel for Intervenor Respondent Natural 

Resource Defense Council

Casey Roberts

Sierra Club

1536 Wynkoop Street

Suite 200

Denver, CO 80202

Megan C. Wachspress

Sierra Club Environmental law Program

2101 Webster Street

13th Floor

Oakland, CA 94612

Counsel for Intervenor Respondent Sierra Club
8

Sarah A. Hunger

Office of Attorney General of Illinois

100 West Randolph Street

12th Floor

Chicago, IL 60601

Counsel for Intervenor Respondents Illinois 

Commerce Commission and People of the State 

of Illinois

Cynthia Bogorad

Lauren L. Springett

Spiegel & McDiarmid

1875 Eye Street NW

Suite 700

Washington, DC 20006

Counsel for Intervenor Respondent Buckeye 

Power, Inc.

Adrienne E. Clair

Thompson Coburn

1909 K Street, NW

Suite 600

Washington, DC 2006

Counsel for Intervenor Respondent Old 

Dominion Electric Cooperative; National Rural 

Electric Cooperative Association
9

Daniel E. Frank

Allison Speaker

Eversheds Sutherland

700 Sixth Street, NW

Suite 700

Washington, DC 20001

Counsel for Intervenor Respondent East 

Kentucky Power Cooperative Inc.

Andrew D. Cordo

Shannon E. German

Wilson Sonsini Goodrich & Rosati

222 Delaware Avenue

Suite 800

Wilmington, DE 19801

Counsel for Intervenor Respondent Advanced 

Energy Economy

Gerit Hull

American Municipal Power

1111 Schrock Road

Suite 100

Columbus, OH 43229

Counsel for Intervenor Respondent American 

Municipal Power Inc.
10

John E. McCaffrey, III

American Public Power Association

2451 Crystal Drive

Suite 1000

Arlington, VA 22202

Counsel for Intervenor Respondent American 

Public Power Association

Anthony J. Corino

PSEG Corporation

80 Park Plaza

Newark, NJ 07102

Counsel for Intervenor Respondents PSEG; 

PSEG Power LLC and PSEG ER&T

Donald R. Goodson

Institute for Policy Integrity

139 MacDougal Street

Third Floor

New York, NY 10012

Counsel for Amicus Appellee Institute for 

Policy Integrity at New York University School 

of Law
11

Christopher R. Nestor

Overstreet & Nestor

461 Cochran Road

P.O. Box 237

Pittsburgh, PA 15228

Counsel for Amicus Petitioner Pennsylvania 

Senate Republican Caucus

Michael E. Rowan

Office of Attorney General of Maryland

Higher Education Div.

200 St Paul Place

20th Floor

Baltimore, MD 21202

Counsel for Amicus Respondents District of 

Columbia, State of Delaware and State of 

Maryland

Ari Peskoe

Harvard Electricity Law Initiative

6 Everett Street

Suite 4119

Cambridge, MA 02138

Counsel for Amicus Respondent Electricity

Regulation Scholars
12 

 

O P I N I ON 

 

ROTH, Circuit Judge: 

This consolidated action represents the latest salvo in a 

years-long battle over whether, and to what extent, statesubsidized energy resources should be subject to price 

mitigation in interstate capacity auctions. The focal point of 

the dispute is a tariff filed by PJM Interconnection, L.L.C. 

(PJM), which took effect by operation of law in 2021.

1

 

Three separate petitions now ask us to exercise, for the 

first time, our authority to review this “action by inaction” 

pursuant to Section 205(g) of the Federal Power Act (FPA),

2 a 

2018 provision expressly articulating the right to review under 

these circumstances. PJM Power Providers Group (P3) and 

Electric Power Supply Association (EPSA) (collectively, 

Generators), two nonprofit associations representing energy 

generators, filed separate petitions. Pennsylvania Public 

Utility Commission and Public Utilities Commission of Ohio 

(State Entities) jointly filed the third.

3

 

1 16 U.S.C. § 824d(g). 

2 Id. §§ 791 et seq.

3 More than two dozen intervenors and amici also filed briefs. 

Intervenor Petitioners include: Monitoring Analytics LLC and 

the Ohio Office of the Consumers Counsel. Amicus for 

Petitioners is the Pennsylvania Senate Republican Caucus. 

Intervenor Respondents include: Union of Concerned 

Scientists, Delaware Division of the Public Advocate, 
13 

The Petitioners, Federal Energy Regulatory 

Commission (FERC), and numerous intervenors and amici

dispute the proper scope of our review pursuant to § 205(g). 

We hold that our review of FERC “action,” whether actual or 

constructive, proceeds under the same deferential standards set 

forth in the FPA and Administrative Procedure Act.

4

 

Consistent with Congress’s directive in § 205(g), we further 

hold that our review properly encompasses the 

Commissioners’ mandatory statements setting forth their 

reasons for approving or denying the filing. 

Reviewing the petitions accordingly, we will deny all 

three because FERC’s acceptance of PJM’s tariff was not 

Maryland Office of Peoples Counsel, Maryland Public Service 

Commission, New Jersey Board of Public Utilities, New Jersey 

Division of Rate Counsel, Natural Resources Defense Council, 

Natural Rural Electric Cooperative, Office of Peoples Counsel 

for the District of Columbia, PJM Industrial Customer 

Coalition, PJM Interconnection LLC, Sierra Club, Illinois 

Commerce Commission, People of the State of Illinois, 

Buckeye Power Inc., Old Dominion Electric Cooperative, East 

Kentucky Power Cooperative Inc., Advanced Energy 

Economy, American Municipal Power Inc., American Public 

Power Association, PSEG, PSEG Power LLC, PSEG ER&T, 

Constellation Energy Corp, Constellation Energy Generation 

LLC, and Exelon Generation Co LLC. Amici on behalf of 

FERC include: the Institute for Policy Integrity at New York 

University School of Law, the District of Columbia, the State 

of Delaware, the State of Maryland, and Electricity Regulation 

Scholars. 

4 5 U.S.C. §§ 551 et seq.
14 

arbitrary or capricious and was supported by substantial 

evidence in the record. 

I. Background 

To frame the issues presented by the parties, we begin 

by reviewing the key statutory provisions governing this 

action, with a particular focus on § 205(g), the 2018 

amendment to the FPA concerning judicial review of FERC 

action by operation of law. We then turn to the factual and 

procedural context for their claims. 

A. The Federal Power Act and Judicial Review

FERC is the independent agency to which Congress, in

the FPA, granted exclusive jurisdiction to ensure “rates 

charged by public utilities for the transmission and sale of 

energy in interstate commerce, and the ‘rules and regulations 

affecting or pertaining to such rates’, [sic] are ‘just and 

reasonable.’”5 While the FPA empowers FERC to regulate 

“all facilities for such transmission or sale of electric energy,” 

it reserves jurisdiction over “facilities used for the generation 

of electric energy” to state and local authorities.6

5 New Jersey Bd. of Pub. Utils. v. FERC, 744 F.3d 74, 79 (3d 

Cir. 2014) (quoting 16 U.S.C. § 824d) (hereinafter NJBPU). 6 NJBPU, 744 F.3d at 80 (quotations omitted) (quoting § 

824(b)(1)); FERC v. Elec. Power Supply Ass’n, 577 U.S. 260, 

264 (2016) (noting that the FPA “authorizes [FERC] to 

regulate ‘the sale of electric energy at wholesale in interstate 

commerce,’” but “leaves to the States alone, the regulation of 

‘any other sale’ ... of electricity”). 
15 

Sections 205 and 206 of the FPA set forth the means by 

which FERC may “fulfill its statutory charge of ensuring the 

justness and reasonableness of rates.”7 Together, they 

comprise part of “a single statutory scheme under which all 

rates are established initially by the [public utilities] . . . and all 

rates are subject to being modified by the Commission upon a 

finding that they are unlawful.”8 Section 205 provides that 

“public utilities may change their rates unilaterally, upon 60 

days’ notice to FERC, which then reviews the changed rates to 

ensure that they are ‘just and reasonable.’”9 “It 

is not necessary, in a filing pursuant to § 205, that FERC find 

that the previous rate was unjust or unreasonable.”10 Rather,

here FERC “plays ‘an essentially passive and reactive role.’”11 

Section 206, in contrast, provides that FERC may proactively 

initiate rate changes, either on its own motion or in response to 

a complaint, if the moving party demonstrates that the existing 

rate is unjust and unreasonable and the proposed alternative is 

just and reasonable.12 Notably, § 206 does not “give[] FERC 

the power to deny a utility the right to file changes” unilaterally 

under § 205.13 

7 Pub. Citizen, Inc. v. FERC, 839 F.3d 1165, 1167 (D.C. Cir. 

2016).

8 Atl. City Elec. Co. v. FERC, 295 F.3d 1, 10 (D.C. Cir. 2002)

(alteration in original) (quoting United Gas Pipe Line Co. v.

Mobile Gas Serv. Corp., 350 U.S. 332, 341 (1956)). 9 NJBPU, 744 F.3d at 94; see 16 U.S.C. § 824d(d). 10 NJBPU, 744 F.3d at 94 (citing Atl. City Elec. Co., 295 F.3d

at 9–10); see 16 U.S.C. § 824d(a)-(d).

11 NJBPU, 744 F.3d at 94 (quoting Atl. City Elec. Co., 295 F.3d

at 9–10).

12 16 U.S.C. § 824e(a). 13 Atl. City Elec. Co., 295 F.3d at 10. 
16 

Our jurisdiction to review FERC orders arises under the 

FPA and Administrative Procedure Act.

14 Specifically, the

FPA providesthat a party aggrieved by a FERC order must first

seek rehearing by the Commission, which may grant or deny 

rehearing, abrogate or modify its order without rehearing, or 

constructively deny rehearing by failing to act within thirty 

days.

15 Within sixty days of the Commission’s order on the

application for rehearing, an aggrieved party may seek review

of “order[s] issued by the Commission” in the courts of

appeals.16 The FPA provides that we “shall have jurisdiction, 

which upon the filing of the record with it shall be exclusive, 

to affirm, modify, or set aside such order in whole or in part.”17 

Finally, the FPA makes clear that, absent orders to the contrary, 

neither the filing of an application for rehearing before the 

Commission nor the start of proceedings before the court of 

appeals shall “operate as a stay of the Commission’s order.”18

The question of what constitutes a reviewable 

Commission order is central to this dispute. FERC’s enabling 

statute establishes that “[a]ctions of the Commission shall be 

determined by a majority vote of the members present.”19 

While FERC comprises five commissioners, a quorum requires 

14 See 16 U.S.C. § 825l(b); 5 U.S.C. § 702 (waiving sovereign

immunity for claims for relief “other than money damages”);

28 U.S.C. § 1331. 15 16 U.S.C. § 825l(a).

16 Id. § 825l(b)

17 Id. (“The finding of the Commission as to the facts, if 

supported by substantial evidence, shall be conclusive.”). 

18 Id. § 825l(c).

19 42 U.S.C. § 7171(e).
17 

just three, making it possible for four commissioners to 

deadlock two-to-two.20 In Public Citizen, Inc. v. FERC, the 

Court of Appeals for the D.C. Circuit considered whether 

judicial review was available for a § 205 rate filing that took 

effect after the four sitting Commissioners deadlocked and 

failed to act within sixty days.

21 The court determined that it

lacked jurisdiction.

22 With regard to the FPA, the court held 

that the secretarial notice issued by the Commission to 

“describ[e] the effects of the deadlock are not reviewable 

orders”23 because “FERC did not engage in collective, 

institutional action when it deadlocked.”24 The court held that

it also lacked jurisdiction under the APA because that statute

only makes inaction reviewable “where the agency fails to take 

a ‘discrete’ action it is legally required to take,”25 and the FPA 

does not “compel” FERC to act on a § 205 filing.26 

Accordingly, the court held that it lacked jurisdiction to review 

FERC inaction resulting in an order by operation of law. The 

court concluded that “[a]ny unfairness associated with this 

outcome inheres in the very text of the FPA. Accordingly, it 

lies with Congress, not this Court, to provide the remedy.”27 

20 Id. § 7171(b)(1), (e).

21 839 F.3d at 1170. 

22 Id. 

23 Id. at 1172. 

24 Id. at 1170. 25 Id. at 1172 (quoting Norton v. S. Utah Wilderness All., 542

U.S. 55, 62–63 (2004)). 26 Id. at 1174 (explaining that the FPA does “not compel FERC 

to either set the disputed rates for hearing or affirmatively 

disapprove any unjust or unreasonable rates through the 

Section 205 process”). 

27 Id.
18 

Congress did so in 2018. Rather than compelling FERC 

to act on a § 205 filing, Congress added a provision to clarify 

how agency inaction should be construed to permit judicial 

review. The new provision, § 205(g),28 stated that if FERC 

“permits the 60-day period . . . to expire without issuing an 

order accepting or denying the change because the 

Commissioners are divided two against two as to the 

lawfulness of the change . . . or if the Commission lacks a 

quorum” then: 

(A) the failure to issue an order accepting or 

denying the change by the Commission 

shall be considered to be an order issued by 

the Commission accepting the change for 

purposes of section 825l(a) of this title [FPA 

§ 313(a)]; and 

(B) each Commissioner shall add to the record 

of the Commission a written statement 

explaining the views of the Commissioner 

with respect to the change.29 

Section 205(g) further established that if “a person seeks a 

rehearing . . . and the Commission fails to act on the merits of 

the rehearing request” within 30 days because the deadlock 

continues, “such person may appeal under section 825l(b)

[FPA § 313(b)].”30 

28 16 U.S.C. § 824d(g). 29 Id. (emphasis added). 

30 Id. § 824d(g)(2).
19 

B. Factual and Procedural Context

“Since the FPA’s passage, electricity has increasingly 

become a competitive interstate business, and FERC’s role has 

evolved accordingly.”31 Today, “[i]ndependent power plants 

now abound, and almost all electricity flows not through ‘the 

local power networks of the past,’ but instead through an 

interconnected ‘grid’ of near-nationwide scope.”32 To ensure 

the reliable transmission of electricity from independent 

generators to “load serving entities” (LSEs)—the 

organizations that deliver electricity to retail consumers—

FERC has empowered nonprofit entities, including Regional 

Transmission Organizations (RTOs), to manage segments of 

the grid.33 RTOs constitute “public utilities” under the FPA, 

subject to FERC’s regulation.34

Intervenor PJM is one such RTO, managing a system 

that serves approximately fifty million consumers in thirteen

mid-Atlantic and Midwestern states and the District of 

Columbia.35 Like other RTOs, PJM fulfills important

functions that include ensuring the grid maintains sufficient 

electrical supply to meet demand during peak periods.36 To 

accomplish this, PJM manages a capacity market that

31 Elec. Power Supply Ass’n, 577 U.S. at 267. 32 Id. (quoting New York v. FERC, 535 U.S. 1, 7 (2002)). 33 Hughes v. Talen Energy Mktg., LLC, 578 U.S. 150, 155 

(2016). 34 NJBPU, 744 F.3d at 82.

35 PJM Br. 3; see Hughes, 578 U.S. at 155.

36 NJBPU, 744 F.3d at 82.
20 

essentially “pay[s] participants for a promise to produce 

electricity when called by PJM to do so.”37 

In 2006, the Commission found the existing capacity 

market was unjust and unreasonable because it maintained

insufficient capacity to keep the system reliable.

38 To remedy 

this, FERC issued an order accepting a negotiated settlement 

among power providers, utility companies, and state and local 

authorities, which provided for the adoption of the Reliability 

Pricing Model.

39 This model works essentially as follows: 

PJM predicts electricity demand 

three years ahead of time, and 

assigns a share of that demand to 

each participating LSE. Owners of 

capacity to produce electricity in 

three years’ time bid to sell that 

capacity to PJM at proposed rates. 

PJM accepts bids, beginning with 

the lowest proposed rate, until it 

has purchased enough capacity to 

satisfy projected demand. . . . [A]ll 

accepted capacity sellers receive 

the highest accepted rate, which is 

called the “clearing price.” LSEs 

37 PJM Br. 4 (citing NJBPU, 744 F.3d at 82 (explaining that 

the capacity market ensures that “there are enough . . .

generators connected to the transmission grid for the system to 

function at peak load.”)). 38 See PJM Interconnection, L.L.C., 135 FERC ¶ 61,022 (2011)

(hereinafter 2011 Order) at ¶ 4. 39 NJBPU, 744 F.3d at 79; see PJM Interconnection, L.L.C., 

117 FERC ¶ 61,331 (hereinafter 2006 Settlement Order). 
21 

then must purchase from PJM, at 

the clearing price, enough 

electricity to satisfy their PJMassigned share of overall projected 

demand.40

Besides allowing LSEs to satisfy their obligations to 

provide a share of projected demand, this forward-looking 

capacity auction serves another purpose, at least in theory: 

sending market signals to suppliers to incentivize resource 

development.

41 “A high clearing price in the capacity auction 

encourages new generators to enter the market, increasing 

supply and thereby lowering the [future] clearing price . . . 

[while] a low clearing price discourages new entry and 

encourages retirement of existing high-cost generators.”42 

Because some participants both buy and sell capacity in 

the auction, the auctions are theoretically vulnerable to 

manipulation by exercise of monopsony power.

43 That is, netbuyers—those who buy more capacity than they sell—could 

artificially depress prices by selling capacity below its true 

cost, skewing the market signals produced by the auction.44 

40 Hughes, 578 U.S. at 155–56; see PPL Energyplus, LLC v.

Solomon, 766 F.3d 241, 251 (3d Cir. 2014); NJBPU, 744 F.3d 

at 83–84. Technically, PJM operates multiple capacity 

auctions. The one at issue in this appeal, and described here, 

is the Base Residual Auction. 

41 Hughes, 578 U.S. at 155–56; see NJBPU, 744 F.3d at 84. 

42 Hughes, 578 U.S. at 155–56; see NJBPU, 744 F.3d at 84. 

43 NJBPU, 744 F.3d at 85. 44 See FERC Br. 14–15; PJM Br. 6; NJBPU, 744 F.3d at 88–

89.
22 

“[T]o address the concern that some market participants might 

have an incentive to depress market clearing prices by offering

supply at less than a competitive level,” the 2006 Settlement

Order approved the implementation of the Minimum Offer 

Price Rule (MOPR).45 

The MOPR established in the 2006 Settlement Order 

(2006 MOPR) was designed to detect bids suppressed through 

monopsony power. An offer that failed a multilevel screening 

process would be “mitigated,” or administratively raised to a 

competitive level.46 The 2006 MOPR applied only to new 

market entrants, excluding nuclear, coal, and hydroelectric 

resources as well as state-mandated resources.47 In approving 

this mechanism, FERC concluded that the MOPR was a 

“reasonable method of assuring that net buyers do not exercise 

monopsony power by seeking to lower prices through self 

supply.”48 Moreover, FERC determined that the MOPR’s 

exception for “reliability projects built under state mandate is 

reasonable because it enables states to meet their 

responsibilities to ensure local reliability.”49

Within a few years, consistent with that responsibility, 

New Jersey and Maryland launched initiatives to develop new 

generation resources to address reliability and capacity 

45 2011 Order at ¶ 6 (citing 2006 Settlement Order at ¶ 103). 46 NJBPU, 744 F.3d at 85.

47 Id. at 86 (explaining that state-mandated resources consisted 

of “any planned resource being developed in response to a state 

regulatory or legislative mandate to resolve a projected 

capacity shortfall”).

48 2006 Settlement Order at ¶ 104; see NJBPU, 744 F.3d at 85. 

49 2006 Settlement Order at ¶ 104. 
23 

concerns in their states.50 Both initiatives required new 

generation resources to sell capacity in the PJM markets, and

both intended to offer the capacity a price below cost to ensure 

the new resources would clear.51 

P3, who is also one of the Petitioners in this action,

responded by filing a § 206 complaint with FERC, calling for 

an end to the state-mandated resources exception in addition to 

other modifications.

52 PJM then filed a revised tariff pursuant 

to § 205, which FERC approved in 2011 with some alterations

(2011 Order). The 2011 MOPR eliminated the state-mandated 

resources exemption, “declin[ing] to accord states an 

opportunity to justify their initiatives on policy grounds, 

instead . . . requiring them to submit cost-based offers like other 

entrants or suffer the consequences of mitigation.”53 At the 

same time, the new MOPR added exemptions for wind and 

solar resources, with the result that after 2011, only natural gas 

facilities were subject to mitigation.

54 

Several parties petitioned this Court for review of the 

2011 Orders, which we denied in 2014.

55 With respect to 

50 NJBPU, 744 F.3d at 87.

51 Id. 52 Id. 53 Id. at 91 (“FERC . . . conclud[ed] that the exemption needed 

to be eliminated due to ‘mounting evidence of risk from what 

was previously only a theoretical weakness in the MOPR 

rules,’ namely, that state-subsidized resources would suppress 

auction prices.”). 54 Id. at 106. 

55 Id. at 112. During the pendency of this Court’s decision in 

NJBPU, aspects of the 2011 tariff not relevant to the instant 
24 

FERC’s elimination of the state-mandated resources 

exemption on the grounds that they would suppress auction 

prices, we observed that while “it could easily be argued that 

this danger was foreseeable in 2006 when the MOPR was first 

approved, FERC has adequately advanced a rationale for its 

about-face . . . . As such, it cannot be said that FERC acted 

without substantial evidence.”56

In 2016, power suppliers filed a § 206 complaint with 

FERC, challenging the MOPR’s exclusive application to new 

market entrants. They argued that such a limitation was unjust 

and unreasonable because it “allowed below-cost offers from 

existing resources under newly-enacted state subsidy programs 

to unjustly displace non-subsidized resources.”57 A three-year 

process culminated with FERC’s two-to-one vote in December 

2019, ordering PJM to extend the MOPR to mitigate offers 

from “both new and existing resources” and any resource either 

receiving or eligible to receive a state subsidy (2019 MOPR).

58 

The goal, FERC said, of this dramatic expansion was to 

“protect PJM’s capacity market from the price-suppressive 

effects of resources receiving out-of-market support by 

ensuring that such resources are not able to offer below a 

competitive price.”59 The sole opposing Commissioner issued 

a dissent, arguing, among other things, that while “the MOPR 

once targeted efforts to exercise market power on behalf of 

matter were amended in a compromise approved by FERC 

order in 2013. See id. at 93–94. 56 Id. at 102. 

57 P3 Br. 15; see Calpine Corp. v. PJM Interconnection, L.L.C., 

169 FERC ¶ 61,239 (hereinafter 2019 Order). 58 2019 Order at ¶¶ 1–2, 5; see EPSA Br. 8; FERC Br. 18–19. 59 2019 Order ¶ 5.
25 

load and directly reduce the capacity market price, it now 

targets state resource decisionmaking, and particularly state 

efforts to address the externalities of electricity generation.”60 

The 2019 MOPR prompted swift opposition.

61 Dozens 

of parties sought to overturn the 2019 MOPR, including 

“consumer advocate groups, state public utility agencies, 

electric cooperatives [and] generators, clean energy 

organizations, and environmental groups.”62 These appeals 

were consolidated in the Seventh Circuit and remain in 

abeyance pending this action.

63 

On July 30, 2021, PJM made another § 205 filing, 

setting forth a revised MOPR (2021 MOPR) to replace the 

expansive one it set forth in 2019. PJM acknowledged that, 

over the previous three years, state investments in renewable 

and nuclear resources had proliferated, in part because of 

states’ unabated and legitimate interest in “address[ing] 

externalities that are not accounted for in PJM’s wholesale 

markets.”64 By “pricing out resources from the capacity 

market” and failing to account for those resources when 

committing capacity, PJM stated, the 2019 MOPR was 

distorting market signals by “incentiv[izing] resources to be 

built that are not needed to maintain reliability” in light of those 

investments.65 Moreover, the 2019 MOPR was incenting 

60 2019 Order (Glick, dissenting), ¶ 16. 61 FERC Br. 20. 62 FERC Br. 20. 63 FERC Br. 20–21; see Ill. Commerce Comm’n v. FERC, Nos. 

20-1645, et al. (7th Cir.).

64 JA0178. 

65 JA0178, 181.
26

market participants to exit the capacity market to “meet their 

policy and business objectives,”66 a shift that threatened to 

“exacerbate[]the very price suppression issue [that the 2019 

MOPR] seeks to mitigate.”67 The result for consumers, PJM 

concluded, would be that those in states providing subsidies 

would “pay[] twice, i.e., for both the excluded resources and 

the resource committed through the auction because the 

excluded resource did not clear” while those in other states 

would see “a capacity cost increase, when . . . the auction 

commits a resource that had a higher Sell Offer than the 

excluded resource’s original offer.”68 PJM concluded: 

[W]hile state policies favoring certain 

generation resources may ultimately cause a 

reduction in capacity clearing prices, such an 

outcome “should not be interpreted as a 

harmful secondary impact of one state’s

policies on other states. Rather, the reduction in 

prices is a natural consequence of the PJM 

market appropriately reflecting state policies 

and consumer preferences for certain types of 

resources. Such state subsidies only lower total 

costs for consumers in other states.”69

PJM explained that the 2021 MOPR would return to “its 

original purpose by focusing on prohibiting and mitigating the 

exercise of buyer-side market power.”70 The 2021 “focused” 

MOPR would “generally accommodate both state policies 

66 JA0182. 

67 JA0185.

68 JA0179–80. 

69 JA0180. 70 JA0171.
27 

regarding generation resource mix and the long-standing 

business models of public power entities,”71 while nonetheless 

barring state action, such as those that New Jersey and 

Maryland had pursued in 2011, that would “directly interfere 

with the auction clearing outcomes.”72 To this end, the 2021 

MOPR would mitigate offers in just two situations: “(1) where 

a capacity resource has the ability and incentive to exercise 

buyer-side market power, and (2) where a capacity resource 

receives state subsidies under a state program that is likely 

preempted by the Federal Power Act.”73 

When the 2021 MOPR was filed, FERC had four sitting 

commissioners. The commissioners deadlocked two-to-two

on the new tariff, failing to issue an order accepting or denying 

the change within sixty days. On September 29, 2021, the 

Commission issued a secretarial notice stating that the new 

2021 MOPR was in effect by operation of law. Consistent with 

§ 205(g)(1)(B), two commissioners (including the chair) filed 

a Joint Statement articulating their reasons for supporting the 

new tariff, while the other commissioners filed separate 

statements explaining their opposition. 

All rehearing requests were denied without an order on 

November 29, 2021. This petition followed. 

II. Standing

An organization suing on its members’ behalf must 

establish associational standing, demonstrating that “(1) at 

71 JA0194. 72 JA0190. 

73 JA0173; see FERC Br. 22; PJM Br. 23. 
28 

least one of its members would have standing to sue in his or 

her own right; (2) ‘the interests it seeks to protect are germane 

to the organization’s purpose’; and (3) ‘neither the claim 

asserted nor the relief requested requires the participation of 

[its] individual members.’”74 To meet the first element of 

associational standing, the organization must establish the 

three familiar components that form “the irreducible 

constitutional minimum of standing”: injury-in-fact, 

causation, and redressability.75 

The Petitioners have met their burden. FERC observes 

that the Generators do not articulate any injuries in their 

opening briefs.76 Nevertheless, the Joint Appendix 

incorporates records from the Generators’ protest before FERC 

that demonstrate that their members suffered economic losses 

as a result of the 2021 MOPR. An affidavit attached to P3’s 

reply brief elaborates on these harms.77 We find that the 

74 See Sierra Club v. FERC, 827 F.3d 59, 65 (D.C. Cir. 2016); 

see also Belmont Mun. Light Dep’t v. FERC, 38 F.4th 173, 185 

(D.C. Cir. 2022) (“Where there are multiple plaintiffs who 

assert overlapping arguments, at least one petitioner must have 

standing to seek each form of relief requested in the petitions 

for review.” (citing Nat’l Ass’n of Regul. Util. Commissioners

v. FERC, 964 F.3d 1177, 1184 (D.C. Cir. 2020))). 

75 Lujan v. Defs. of Wildlife, 504 U.S. 555, 560 (1992); see

Friends of the Earth, Inc. v. Laidlaw Env’t Servs. (TOC), Inc., 

528 U.S. 167, 180–81 (2000); Kansas Corp. Comm’n v. FERC, 

881 F.3d 924, 929 (D.C. Cir. 2018) (quoting Sierra Club v.

EPA, 292 F.3d 895, 899–900 (D.C. Cir. 2002) (citations 

omitted)). 

76 FERC Br. 35. 

77 P3 Reply Br. 3, Attachment A (Decl. Glen Thomas). 
29 

Generators have met their burden to articulate a concrete and 

particularized injury, and that the cause of their injuries is 

traceable to FERC’s approval, by operation of law, of the 2021 

MOPR.78 We also hold that the State Entities have met their 

burden to establish a cognizable injury, having demonstrated 

that they “represent the interests of the states in protecting their 

citizens and electric ratepayers in the traditional government 

field of utility regulation.”79 

FERC also argues that the Petitioners failed to establish 

that their purported injuries are redressable in this action. 

Specifically, FERC argues that even if we were to vacate the 

order by operation of law that allowed the 2021 MOPR to go 

into effect, the 2021 MOPR would remain in effect until a new 

tariff could be established upon remand.80 We disagree. 

Contrary to FERC’s assertion, “[v]acating or rescinding 

invalidly promulgated regulations has the effect of reinstating 

prior regulations.”81 While these potentially “disruptive 

78 See Belmont Mun. Light Dep’t, 38 F.4th at 185.

79 Id. at 186 (citing Maryland People’s Counsel v. FERC, 760

F.2d 318, 321 (D.C. Cir. 1985)); see State Entities Reply Br. 

5–6. 

80 FERC Br. 39. 

81 Abington Mem’l Hosp. v. Heckler, 750 F.2d 242, 244 (3d

Cir. 1984); Prometheus Radio Project v. F.C.C. (Prometheus

I), 652 F.3d 431, 453 n.25 (3d Cir. 2011) (“Because we vacate 

the NBCO rule in the 2008 Order, the rule in existence prior to 

that order will remain in effect until the FCC promulgates new 

cross-ownership regulations.”); see Council Tree Commc’ns,

Inc. v. F.C.C., 619 F.3d 235, 258 (3d Cir. 2010) (“vacating [an 

FCC] rule will mean that” the prior rule “will once again” 

govern the regulated activity); Paulsen v. Daniels, 413 F.3d

999, 1008 (9th Cir. 2005) (“The effect of invalidating an 
30 

consequences”82 may militate toward less drastic solutions,83

such a remedy is nonetheless within the scope of our statutory 

authority. 

III. Standard of Review

At the threshold, the parties dispute the applicable 

standard and scope of judicial review upon a petition 

proceeding under § 205(g). 

agency rule is to reinstate the rule previously in force.”); Action

on Smoking and Health v. CAB, 713 F.2d 795, 797 (D.C. Cir.

1983) (per curiam) (“To ‘vacate,’ as the parties should well 

know, means ‘to annul; to cancel or rescind; to declare, to 

make, or to render, void; to defeat; to deprive of force; to make 

of no authority or validity; to set aside.’ . . . . [T]he judgment 

of this court had the effect of reinstating the rules previously in 

force.”). 

82 Ameren Servs. Co. v. FERC, 880 F.3d 571, 584 (D.C. Cir. 

2018) (quoting Black Oak Energy, LLC v. FERC, 725 F.3d

230, 244 (D.C. Cir. 2013)); see Prometheus Radio Project v. 

Fed. Commc’ns Comm’n (Prometheus II), 824 F.3d 33, 52 (3d 

Cir. 2016). 

83 See, e.g., Black Oak Energy, 725 F.3d at 244 (“Although we 

remand, we do so without vacating . . . [after performing the 

disruption analysis] we deem it better to preserve the status quo 

as FERC reconsiders”); Ameren Servs. Co., 880 F.3d at 584 

(vacating because “we are troubled by the prospect of allowing 

the orders to continue”); see Belmont Mun. Light Dep’t v.

FERC, 38 F.4th 173, 187–88 (D.C. Cir. 2022) (determining 

that a FERC order is severable and vacating only one 

component). 
31 

We review FERC orders under § 313(b) of the FPA and 

§ 10(e) of the APA.

84 The FPA directs that FERC’s factual

findings, “if supported by substantial evidence, shall be 

conclusive.”85 Substantial evidence exists where the 

administrative record contains “more than a scintilla, but . . . 

something less than a preponderance of the evidence.”86 Under 

the APA, we must “hold unlawful and set aside” agency action

that is deficient for reasons including that it is “arbitrary, 

capricious, an abuse of discretion, or otherwise not in 

accordance with law,” or “in excess of statutory jurisdiction, 

authority, or limitations, or short of statutory right.”87 In short,

we affirm FERC orders as long as the administrative record 

shows the Commission “examined the relevant data and 

84 16 U.S.C. § 825l(b); 5 U.S.C. § 706(2).

85 16 U.S.C. § 825l(b). 86 NJBPU, 744 F. 3d at 94 (quoting La. PSC v. FERC, 522 F.3d

378, 395 (D.C. Cir. 2008)); accord Mars Home for Youth v.

NLRB, 666 F.3d 850, 853 (3d Cir. 2011) (“Substantial 

evidence is more than a mere scintilla. It means such relevant 

evidence as a reasonable mind might accept as adequate to 

support a conclusion.” (citations and quotations omitted)). See 

also NJBPU, 744 F.3d at 94 (“The question we must answer ... 

is not whether record evidence supports [petitioner]’s version 

of events, but whether it supports FERC’s.” (quoting Fla. Mun.

Power Agency v. FERC, 315 F.3d 362, 368 (D.C. Cir. 2003))). 

87 5 U.S.C. § 706(2); see City of Newark v. FERC, 763 F.2d

533, 545 (3d Cir. 1985) (court must determine “whether a 

rational basis exists for [FERC’s] conclusion, whether there 

has been an abuse of discretion, or . . . whether the 

Commission’s order is arbitrary or capricious or not in 

accordance with the purpose of the [FPA].”). 
32 

articulated a rational connection between the facts found and 

the choice made.”88 

FERC urges, and we agree, that § 205(g) did not alter

these familiar standards.89 Rather, the provision clarified the 

universe of action subject to our review. Prior to its enactment, 

the plain text of the FPA did not convey Congress’s intent to 

allow our review of rate filings enacted by operation of law 

pursuant to § 205(d). Congress addressed this deficiency with

§ 205(g), which unambiguously instructed that we construe 

FERC’s inaction as an affirmative order “for the purposes of § 

[313](a).”90 Notably, Congress here referred to the very

provision setting forth a party’s right to seek the Commission’s 

rehearing of an order by majority vote, which in turn provides 

the basis for judicial review.91 Indeed, § 205(g) specifies that 

88 NJBPU, 744 F.3d at 94 (quoting Sacramento Mun. Util. Dist.

v. FERC, 616 F.3d 520, 528 (D.C. Cir. 2010)); see also

Morgan Stanley Capital Grp. Inc. v. Pub. Util. Dist. No. 1 of

Snohomish Cnty., 554 U.S. 527, 532 (2008) (“The statutory 

requirement that rates be ‘just and reasonable’ is obviously 

incapable of precise judicial definition, and we afford great 

deference to the Commission in its rate decisions.”); N. Penn.

Gas Co. v. FERC, 707 F.2d 763, 766 (3d Cir. 1983) (FERC’s 

exercise of its expertise carries “a presumption of validity”).

89 See FERC Br. 34–35, 49. While we generally defer to an 

agency’s reasonable interpretation of ambiguity in a statute it 

administers “through application of its expertise,” no deference 

doctrine controls the scope of a court’s jurisdiction. See

Allegheny Def. Project v. FERC, 964 F.3d 1, 11 (D.C. Cir. 

2020).

90 § 205(g) (emphasis added); see 16 U.S.C. § 825l(a).

91 See 16 U.S.C. § 825l(b) (“Any party to a proceeding under 

this chapter aggrieved by an order issued by the Commission 
33 

if the “Commission fails to act on the merits of the rehearing 

request” within 30 days because the deadlock continues, “such 

person may appeal under § [313](b).”92 Thus, by reference, the 

standard of review set forth in the FPA93 applies to FERC 

orders issued by operation of law pursuant to § 205(d).

94 

We reject the State Entities’ argument that we must 

review “on a de novo basis, whether the tariff change is just 

and reasonable as a predicate to deciding whether [FERC’s] 

discretion to approve was properly exercised.”95 This reading 

contradicts the well-settled administrative law principle, 

reflected in both the FPA and APA, that “‘a court is not to 

substitute its judgment for that of the agency.’”96 Moreover, 

the sole authority cited by the State Entities to support its 

reading concerns an inapposite statute (the Indian Gaming 

Regulatory Act or IGRA), which at least one sister court has 

rejected as an appropriate analog for the FPA because the 

IGRA requires agency action while the FPA gives the agency 

discretion to act.

97 

in such proceeding may obtain a review of such order in the 

United States court of appeals . . . .”). 

92 Id. § 824d(g)(2); see id. § 825l(b).

93 See id. § 825l(b).

94 § 205(g). 95 State Entities Br. 21–22 (citing Amador County, Cal. v. 

Salazar, 640 F.3d 373, 375 (D.C. Cir. 2011)). 

96 Motor Veh. Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto.

Ins. Co., 463 U.S. 29, 43 (1983).

97 Compare State Entities Br. 22, with Public Citizen, 839 F.3d 

at 1173 (“Section 205(a)’s statement concerning the 

unlawfulness of unjust and unreasonable rates does not rise to 

an inexorable command like that found in IGRA”).
34 

To carry out Congress’s directive to construe FERC 

inaction as an affirmative order, we must next determine what 

constitutes evidence of the agency’s reasoning for the purposes 

of § 205(g).

98 The Generators insist that nothing does, arguing 

that a deadlocked Commission can produce “no institutional 

findings of fact or conclusions of law to which this Court might 

defer.”99 While they acknowledge Congress’s mandate in § 

205(g)(1)(B) that the members of a deadlocked Commission 

must enter their reasoning into the record, they argue that these 

statements are unattributable to the agency and are intended

only to “facilitate compromises” and promote transparency and 

good government.100 Because any order arising by operation 

of law would, by the Generators’ logic, lack any agency 

rationale, they conclude that any petition for rehearing 

pursuant to § 205(g) must “inevitably”101 lead us to find such 

an order arbitrary and capricious.102

98 See Sprint Nextel Corp. v. F.C.C., 508 F.3d 1129, 1132 (D.C. 

Cir. 2007) (“When the Commission failed to [act] within the 

statutory period, Congress’s decision—not the agency’s—took 

effect.”). 

99 P3 Br. 29, 34–36 (“[a]ctions of the Commission shall be 

determined by a majority vote of the members present” (citing 

42 U.S.C. § 7171(e)); accord EPSA Br. 18, 21, 23; State 

Entities Br. 29–30 (citing Public Citizen, 839 F.3d at 1169).

100 P3 Br. 36–37; see EPSA Br. 18, 23, 27 (quoting F.C.C. v.

Prometheus Radio Project (Prometheus III), 141 S. Ct. 1150, 

1158 (2021)); see State Entities Br. 29.

101 EPSA Br. 19–20; P3 Br. 33–35. 102 The Generators also wrongly contend that because orders 

by operation of law are necessarily arbitrary and capricious, 

they must be set aside. See P3 Br. 29, 35 (“[J]udicial review of 
35 

The Generators’ argument is inconsistent with our 

responsibility to avoid interpreting statutory provisions in ways 

that “render statutory language a nullity and leave entire 

operative clauses with ‘no job to do.’”103 Congress established 

in § 205(d), and underscored in § 205(g), that a tariff may 

change by operation of law,

104 consistent with the principle that 

deadlocked FERC proceedings would inevitably end in 

vacatur.” (emphasis added)); EPSA Br. 15 n. 3 (incorporating 

by reference P3’s arguments concerning vacatur); EPSA Br.

16, 25, 43. But vacatur is never a foregone conclusion. First, 

the plain text of the FPA authorizes us not only to vacate, but 

also to modify an improper order. 16 U.S.C. § 825l(b). 

Second, to determine the appropriateness of vacatur, we 

conduct a fact-sensitive analysis accounting for “the gravity of 

the orders’ flaws, and the ‘disruptive consequences’ that may 

result.” Ameren Servs. Co., 880 F.3d at 584 (quoting Black

Oak Energy, LLC, 725 F.3d at 244; see Prometheus II, 824 

F.3d at 52; Belmont Mun. Light Dep’t, 38 F.4th at 187–88 

(determining that a FERC order is severable and vacating only 

one component). We further observe that while vacatur is the 

Generators’ preferred remedy here, to adopt their theory 

globally risks hampering the claims of future litigants seeking 

redress by modification, and not vacatur. Accordingly, we 

reject the Generators’ reading. 103 Allegheny, 964 F.3d at 15 (quoting Doe v. Chao, 540 U.S. 

614, 623 (2004)). 

104 § 824d(d) (“No change shall be made by any public utility 

in any such rate, . . . rule, regulation, or contract relating 

thereto, except after sixty days’ notice to the Commission and 

to the public.” (emphasis added)); § 824d(g) (“With respect to 

a change described in subsection (d), if the Commission 

permits the 60-day period established therein to expire without 
36 

the “power to initiate rate changes rests with the utility and 

cannot be appropriated by FERC in the absence of a finding 

that the existing rate was unlawful.”105 The Generators’ theory 

would flip § 205(d)’s protective intent on its head, enabling any

aggrieved party to invalidate any rate change by operation of 

law simply by virtue of requesting judicial review—a process 

the Generators’ theory reduces to a mechanical exercise with 

only one possible outcome. This cannot be right. If Congress’s 

purpose were indeed to strip utilities of the protections afforded 

by § 205(d), or to otherwise invalidate orders by operation of 

law, it would have amended that portion of the statute 

accordingly, not created a cumbersome workaround via § 

205(g). 

Moreover, the Generators’ reading would sap § 

205(g)(1)(B) of purpose. It is a “fundamental canon 

of statutory construction that the words of a statute must be 

read in their context and with a view to their place in the overall 

statutory scheme.”106 Here, § 205(g)(1)(B) appears as part of 

an enumerated list of provisions concerning aggrieved parties’ 

right to seek rehearing and judicial review of a change arising 

from agency inaction. It makes little sense to argue, as P3 does, 

that Congress’s purpose in requiring the Commissioners to add 

statements explaining their reasoning to the administrative 

record could have been to “facilitate compromises” and 

issuing an order accepting or denying the change . . . the failure 

. . . shall be considered to be an order issued by the Commission 

accepting the change for purposes of” judicial review

(emphasis added)). 

105 Atl. City Elec. Co., 295 F.3d at 10. 

106 King v. Burwell, 576 U.S. 473, 492 (2015) (quoting Util. Air

Reg. Grp. V. EPA., 573 U.S. 302, 320 (2014)). 
37 

promote transparency and good government only.

107 The right 

to judicial review accrues after a party has been aggrieved by 

a change, and therefore after the time for compromise has 

passed.108

We agree with FERC that Congress intended “the 

Commissioners’ statements [to] play an integral role in the 

Court’s review.”109 Here, the statements of the deadlocked 

Commissioners do more than record each person’s individual 

rationale for affirming or rejecting the rate filing. Collectively, 

they illuminate the agency’s reasons for inaction, which 

Congress has instructed us to construe as an affirmative 

order.110 Because FERC must accept a § 205 rate filing absent 

“a finding that the existing rate was unlawful,”111 our thorough 

consideration of the entire record must ensure that the 

107 P3 Br. 37. 

108 Notably, in neither of § 205(g)’s two enumerated clauses 

did Congress qualify “change” with any adjective (e.g., 

“proposed” or “potential”) to indicate that such change was 

pending, and not already in effect. Rather, the text plainly 

refers to the change in tariff effected by the agency’s inaction, 

pursuant to § 205(d). 

109 FERC Br. 4. 

110 P3 repeatedly asks us to vacate the September 29, 2021 

Notice, treating that document as if it were a FERC order. P3 

confuses the nature of that instrument, which does not itself 

constitute reviewable FERC action but rather memorialized the 

results, already in effect, of the Commission’s inaction. 

111 Atl. City Elec. Co., 295 F.3d at 10; see Public Citizen, 839 

F.3d at 1174 (noting the FPA does “not compel FERC to either 

set the disputed rates for hearing or affirmatively disapprove 

any unjust or unreasonable rates through the Section 205 

process.”). 
38 

Commissioners who did not find the 2021 MOPR unlawful 

engaged in “decisionmaking [that was] reasoned, principled, 

and based upon the record.”112 

While unusual, such a reading has precedent. In the 

Federal Election Commission Act, Congress similarly 

incorporated language making clear that a party aggrieved “by 

a failure of the Commission to act” may seek administrative 

appeal and judicial review.113 As the D.C. Circuit Court of 

Appeals explained in Public Citizen, when the Federal Election 

Commission deadlocks over whether to exercise its discretion 

to act, “[t]o make judicial review a meaningful exercise,’ [the 

court must] treat the statements of the Commissioners voting 

to dismiss the complaint as the administrative record.”114 The 

court in Public Citizen declined to follow this approach 

because, at the time, the FPA did not contain “a similar 

congressional indication” about how to construe agency 

deadlock.115 With § 205(g), Congress filled that gap.

116 

112 W. Res., Inc. v. FERC, 9 F.3d 1568, 1572 (D.C. Cir. 1993) 

(quoting Columbia Gas Transmission Corp. v. FERC, 628

F.2d 578, 593 (D.C. Cir. 1979)); see Fed. Election Comm’n v. 

Nat’l Republican Senatorial Comm., 966 F.2d 1471, 1476 

(D.C. Cir. 1992) (these commissioners “constitute a 

controlling group for purposes of the decision[ and] their 

rationale necessarily states the agency’s reasons for acting as it 

did.”). 

113 52 U.S.C. § 30109(a)(8)(A).

114 Public Citizen, 839 F.3d at 1170 (citing Fed. Election

Comm’n, 966 F.2d at 1476); see Common Cause v. Fed.

Election Comm’n., 842 F.2d 436, 450 (D.C. Cir. 1988).

115 Public Citizen, 839 F.3d at 1171. 116 For this reason, P3 errs by relying on Public Citizen, which 

turned on the absence of such an indication, for the proposition 
39 

We disagree that § 205(g) contradicts the Commission’s 

enabling statute as codified at 42 U.S.C. § 7171(e), which 

states that “[a]ctions of the Commission shall be determined by 

a majority vote of the members present.”117 Section 205(g) 

concerns only how agency inaction should be construed for the 

limited purposes of rehearing and review but does not 

illuminate what constitutes agency action per se.118 Even if § 

205(g) did contradict § 7171(e), traditional rules of statutory 

interpretation counsel that “[s]pecific terms prevail over the 

general in the same or another statute which otherwise might 

be controlling.”119 Here, Congress identified narrow 

circumstances under which to construe inaction, in a particular 

way, for a specific purpose.120 

that FERC inaction cannot be construed as action for the 

purposes of judicial review. 117 P3 Br. 29, 34–36 (citing 42 U.S.C. § 7171(e) (“[a]ctions of 

the Commission shall be determined by a majority vote of the 

members present”); accord EPSA Br. 18, 21, 23; State Entities 

Br. 29–30 (citing Public Citizen, 839 F.3d at 1169).

118 See 42 U.S.C. §7171(e). 

119 Superior Oil Co. v. Andrus, 656 F.2d 33, 36 (3d Cir. 1981)) 

(quoting Fourco Glass Co. v. Transmirra Corp., 353 U.S. 222,

228–29 (1957)). 120 We have no “grave constitutional concern” that a single 

Commissioner’s views could stand for all when a rate filing 

takes effect because the Commission has deadlocked. EPSA 

Br. 27. Under the terms of the statute, this circumstance would 

always result in two Commissioners’ views controlling—the 

same number that would constitute an unobjectionable 

majority among a quorum of three Commissioners. 

Nevertheless, we do not decide today whether a constitutional 
40 

 

For the foregoing reasons, we hold first that where a 

quorum of FERC Commissioners deadlocks two-to-two on a § 

205 rate filing, our review of the resulting order must adhere to 

the same standard that would govern our review of an order 

approved by a FERC majority.121 Second, we hold that our

review properly encompasses the entire record, including the 

four Commissioners’ § 205(g)(1)(B) statements. 

IV. Merits 

We now reach the substance of the parties’ dispute. 

Construing the agency’s deadlocked vote on the 2021 MOPR 

as an affirmative order consistent with § 205(g), and 

considering the Commissioners’ recorded statements, we

conclude that the rationale set forth in the Joint Statement for 

approving the 2021 MOPR was neither arbitrary nor capricious 

and was supported by substantial evidence in the record. We 

are not persuaded otherwise by the arguments set forth in the 

other Commissioners’ statements. Accordingly, we will deny 

the Generators’ petitions on the merits.122

concern might arise when a rate filing goes into effect in the 

absence of a quorum, in which case the “views of a single 

Commissioner [could] . . . gain the force of law.” EPSA Br. 

27, 28 (citing Seila Law LLC v. Consumer Fin. Prot. Bureau, 

140 S. Ct. 2183, 2201 (2020)). 

121 NJBPU, 744 F.3d at 94 (citing Sacramento Mun. Util.

Dist., 616 F.3d at 528). 

122 P3 suggests that FERC’s order by operation of law pursuant 

to § 205 was facially improper because it overturned a tariff 

ordered by FERC under § 206, professing to be “unaware of 

any authority that permits a public utility to change rates 
41 

In reviewing FERC’s orders, we consider only “whether 

a rational basis exists for a conclusion, whether there has been 

an abuse of discretion, or . . . whether the Commission’s order 

is arbitrary or capricious or not in accordance with the purpose 

of the [FPA].”123 “[B]ecause issues of rate design . . . involve 

policy judgments that lie at the core of the regulatory mission, 

our review of whether a particular rate design is just and 

imposed on that utility by FERC under FPA section 206.” P3 

Br. 31, 33 (“[T]he Notice must be vacated because it disregards 

the text and structure of the FPA by elevating a mere filing 

under section 205 above FERC orders under section 206.”). 

The State Entities similarly suggest the existence of a “higher 

Section 206 standard,” State Entities Br. 28, insisting that as a 

per se matter, “FERC cannot overturn its prior precedent 

through inaction,” State Entities Br. 28. Both parties are

incorrect. It is well-settled that “[n]othing in section 206 

sanctions denying petitioners their right to unilaterally file rate 

and term changes.” Atl. City Elec. Co., 295 F.3d at 10 

(collecting cases). Indeed, “courts have repeatedly held that 

FERC has no power to force public utilities to file particular 

rates unless it first finds the existing filed rates unlawful . . . . 

Nor may FERC prohibit public utilities from filing changes in 

the first instance.” Id. As intervenors for the respondent note, 

P3’s interpretation would erode the careful balance that 

Congress has achieved in the statute by “gradually 

eliminat[ing] the utility’s rights under Section 205 . . . to set 

the rates it will charge prospective customers, and change them 

at will, subject to review by the Commission.” RespondentIntervenors Br. 29 (quoting Atl. City Elec. Co., 295 F.3d at 10) 

(cleaned up). Accordingly, we reject P3’s suggestion that a § 

205 filing cannot displace a tariff set by § 206. 123 City of Newark, 763 F.2d at 545. 
42 

reasonable is highly deferential.”124 The MOPR dispute 

concerns precisely such a judgment: How best to protect the 

integrity of the capacity market, in view of the diverse and 

legitimate interests of its myriad stakeholders and the 

innumerable factors that influence price. 

FERC has approved various approaches to this 

conundrum since 2006. We have previously observed that 

“FERC is permitted to weigh the danger of price suppression 

against the counter-danger of over-mitigation, and determine 

where it wishes to strike the balance.”125 Here, the 2021 

MOPR reflected a shift away from the regime embraced in the 

2019 MOPR, at least arguably toward the purpose of 

“address[ing] the concern that some market participants might 

have an incentive to depress market clearing prices by offering 

supply at less than a competitive level.”126 

Such shifts are permissible. An agency may alter its 

“view of what is in the public interest.”127 The fact that 

contrary agency precedent exists “gives us no more power than 

usual to question the Commission’s substantive 

determinations.”128 The agency need not establish that “the 

124 Md. Pub. Serv. Comm’n v. FERC, 632 F.3d 1283, 1286

(D.C. Cir. 2011). 125 NJBPU, 744 F.3d at 109. 126 2011 Order at ¶ 6 (citing 2006 Settlement Order at ¶ 103). 

127 Motor Vehicle Mfrs. Ass’n of United States, Inc. v. State

Farm Mut. Auto. Ins. Co., 463 U.S. 29, 57 (1983) 

(quoting Greater Bos. Television Corp. v. F.C.C., 444 F.2d

841, 852 (D.C. Cir. 1970)); see NJPBU, 744 F.3d at 100. 

128 NJPBU, 744 F.3d at 100 (quoting Nat’l Cable & 

Telecomms. Ass’n v. F.C.C., 567 F.3d 659, 669 (D.C. Cir.

2009)); see also Elec. Consumers Res. Council v. FERC, 407
43 

reasons for the new policy are better than the reasons for the 

old one; it suffices that the new policy is permissible under the 

statute, that there are good reasons for it, and that the 

agency believes it to be better.”129 

We hold that FERC met these criteria in constructively 

approving the 2021 MOPR. The eighty-six-page Joint 

Statement acknowledged that the 2021 MOPR reflects a 

change in policy and identified reasons for finding the change 

just and reasonable.130 Specifically, the authoring 

F.3d 1232, 1239 (D.C. Cir. 2005) (stating that a court’s 

deference to FERC on complex rate market design “is based 

on the understanding that the Commission will monitor its 

experiment and review it accordingly”).

129 F.C.C. v. Fox Television Stations, Inc., 556 U.S. 502, 515 

(2009).

130 The two commissioners who concluded the 2021 MOPR 

was not just and reasonable issued separate statements 

articulating their views. While non-identical, the 

commissioners reached the same core conclusion: The 2021 

MOPR did not meet the just and reasonable standard because 

it was anti-competitive. See JA0129 (Christie Statement) 

(“[T]he PJM MOPR Proposal, now in effect by operation of 

law, forfeits any remaining credibility to the claim that the PJM 

capacity market is based on actual competition or is run for the 

benefit of consumers”); JA0169 (Danly Statement) (“PJM’s 

proposal eliminating all mitigation of the price-suppressive 

effects of state subsidies is irredeemably inconsistent with FPA 

section 205’s requirement that proposed rates must be just and 

reasonable.”). As discussed herein, these policy concerns are 

addressed in the Joint Statement, along with the authoring 

commissioners’ reasons for not adopting them, reasons which 
44 

Commissioners asserted that a more narrowly targeted MOPR 

would benefit “investors and consumers alike” by “more 

accurately reflect[ing] the facts and realities on the ground,”131

while “provid[ing] a sufficient opportunity for resources to 

recover their costs.”132 The Joint Statement noted that its 

policy might result in lower prices on the capacity market than 

under the expanded 2019 MOPR but concluded that such a 

result is “just and reasonable because the market will reflect 

supply and demand fundamentals,”133 which include state 

policies alongside federal policies, “[s]iting policies, tax rules, 

and labor regulations,” among others.134 According to the 

Joint Statement, the 2019 MOPR allowed for an “artificially 

inflated price [that] will falsely signal that new entry is needed 

or that existing resources should forestall retirement,” with 

potentially “detrimental effects on PJM’s energy and ancillary 

services markets.”135 

The Joint Statement identified specific changed 

circumstances to support these conclusions, including a 

proliferation of state policies to shape the resource mix that had 

occurred over the prior three years, largely to “address 

externalities that are neither accounted for nor compensated in 

are neither arbitrary nor capricious and are based on substantial 

evidence in the record. Because it may not, our conclusion in 

this regard does not derive from our own policy preferences. 

Rather, it accepts and reflects our role here as circumscribed 

by statute and precedent.

131 JA0060 ¶ 44. 132 JA0060 ¶ 45. 133 JA0067 ¶ 55.

134 JA0068 ¶¶ 56, 57. 

135 JA0067 ¶ 54.
45 

PJM’s wholesale markets.”136 The Joint Statement noted that 

“[s]tates are playing a more active role in shaping the resource 

mix—including both entry and exit—than they were at the time 

the Commission issued previous orders addressing the scope 

and purpose of PJM’s MOPR.”137 Policies passed since 2018 

alone could together “support the entry of more than 44,000 

MW of capacity into PJM’s capacity market over the next” 

fifteen years, the Joint Statement noted.

138 The authoring 

Commissioners observed that failing to account for the 

contributions of these resources to capacity could cost 

consumers a total of $3.4 billion by 2030.

139 

The Joint Statement also analyzed the results of the first 

base residual auction held under the 2019 MOPR. The 

authoring Commissioners noted that a generating station 

benefitting from one state’s zero-emission credit failed to clear, 

and that “capacity prices likely increased by over $10/MWday, or an additional $90 million in the ComEd zone, as a 

result”—harms that “can be expected to increase significantly 

as states continue to support resources that will not benefit 

from the [2019] MOPR’s” exclusions.140 The Joint Statement 

also pointed to evidence that “several states have considered 

136 JA0057 ¶ 36. 

137 JA0070 ¶ 59.

138 JA0084 ¶ 80. 

139 JA0064 ¶ 50. See Constellation Energy Commodities Grp.,

Inc. v. FERC, 457 F.3d 14, 24 (D.C. Cir. 2006) (“[I]t is within 

the scope of the agency’s expertise to make . . . a prediction 

about the market it regulates, and a reasonable prediction 

deserves our deference notwithstanding that there might also 

be another reasonable view.”) (cleaned up). 140 JA0066 ¶ 52. 
46 

abandoning the capacity market altogether rather than have the 

resources needed to meet their public policy goals be subjected 

to mitigation,” an outcome that would threaten the purpose and 

structure of the market itself.141 

Petitioner EPSA contends that the Joint Statement failed 

to address the validity of any potential reliance interests, 

arguing the “parties demonstrated that investors have sunk 

many billions of dollars into constructing new power plants 

and maintaining existing ones, all in reliance on the existence 

of PJM market mechanisms that ensure a competitive 

marketplace, rather than a marketplace skewed by the 

participation of un-economic resources.”142 But an agency not 

“writing on a blank slate” is required only to “assess whether 

there were reliance interests, determine whether they were 

significant, and weigh any such interests against competing 

policy concerns.”143 Here, the Commissioners considered 

“arguments that the Expanded [2019] MOPR must be 

preserved because investors relied on it” but determined these 

did not “tilt the balance” against their articulated policy 

concerns, in light of the fact that the 2019 MOPR had been in 

place for a relatively short period during which it was “wellpublicized” that “PJM was exploring the possibility of 

replacing the Expanded MOPR.”144 As we concluded in 2014, 

responding to similar arguments, “we are not unsympathetic to 

[investor’s] arguments that they reasonably relied” on the 

terms of the prior MOPR, but nevertheless “find no fault with 

141 JA0070 ¶ 58. 

142 EPSA Br. 30. 143 Dep’t of Homeland Sec. v. Regents of the Univ. of

California, 140 S. Ct. 1891, 1915 (2020). 

144 JA0071 ¶ 61. 
47 

FERC’s ability to, and reasons for” constructively approving 

the new one.145 

P3 challenges various technical provisions of the 2021 

MOPR, devised by PJM to accomplish its twin policy 

objectives of mitigating offers resulting from the exercise of 

buy-side market power and conditioned state support. From 

these objections,146 P3 concludes that because PJM’s proposed 

mechanism fails to ensure adequately that “neither buyer nor 

seller have market power, ‘the prevailing price in the 

marketplace cannot be the final measure of “just and 

reasonable” rates mandated by the Act.’”147

145 NJBPU, 744 F.3d at 100. 

146 P3 generally alleges that both prongs are “unjust, 

unreasonable, and unduly discriminatory,” without articulating 

precisely how. With respect to the Buyer Side Market Power 

and Conditioned State Support provisions, including that (1) 

PJM’s proposed self-certification process is insufficiently 

robust, (2) that its requirement that sellers self-certify their 

intent is “easily evaded” and runs counter to prior policy 

approved by FERC; (3) the tests required upon review by the 

PJM and/or Independent Market Monitor are evadable and rely 

on concepts rejected, with FERC approval, in earlier MOPRs; 

and (4) the test is insufficiently transparent and affords too 

much discretion to PJM and the Independent Market Monitor. 

See P3 Br. 51–54. With respect to the provisions related to 

Conditioned State Support, P3 argues that these are “riddled 

with practical defects,” improperly exempts existing policies, 

and only mitigates state actions are already unlawful under the 

Supreme Court’s decision in Hughes v. Talen Energy Mktg,

LLC, 578 U.S. 150 (2016). P3 Br. 49–50.

147 P3 Br. 47 (quoting FPC v. Texaco Inc., 417 U.S. 380, 397 
48 

We disagree. “The statutory requirement that rates be 

‘just and reasonable’ is obviously incapable of precise judicial 

definition,”148 and “FERC’s authority to determine whether 

wholesale rates are ‘just and reasonable’ is exclusive.”149 We 

“properly defer[] to policy determinations invoking the 

Commission’s expertise in evaluating complex market 

conditions.”150 Although “courts have never given regulators 

carte blanche,”151 our review is “limited to ensuring that the 

Commission has made a principled and reasoned decision 

supported by the evidentiary record.”152 Here, the Joint 

Statement responds to both the technical and policy criticisms

levelled by P3, concluding that the mechanisms proposed by 

PJM were sufficient to mitigate anti-competitive offers while 

“appropriately balanc[ing] the risk of under- and over-

(1974)); see P3 Br. 47–48 (stating that the new rules “do 

virtually nothing to prevent the exercise of state-sponsored 

market power. Instead, they establish an opaque and toothless 

process of exclusions and exceptions that ‘is even worse than 

having no MOPR at all.’”) (quoting Comm’r Christie 

Statement, JA0125–26 ¶ 3). 

148 Morgan Stanley Cap. Grp. Inc. v. Pub. Util. Dist. No. 1 of

Snohomish Cnty., Wash., 554 U.S. 527, 532 (2008).

149 California ex rel. Lockyer v. FERC, 383 F.3d 1006, 1011 

(9th Cir. 2004) (quoting Miss. Power & Light Co. v.

Mississippi, 487 U.S. 354, 371 (1988)). 

150 Tenn. Gas Pipeline Co. v. FERC, 400 F.3d 23, 27 (D.C. Cir.

2005). 151 Emera Maine v. FERC, 854 F.3d 9, 22 (D.C. Cir. 2017) 

(quoting Elec. Consumers Res. Council v. FERC, 747 F.2d

1511, 1514 (D.C. Cir. 1984)). 152 Id. (quoting S. Cal. Edison Co. v. FERC, 717 F.3d 177, 181 

(D.C. Cir. 2013)). 
49 

mitigation.”153 We cannot conclude on this record that the 

Commission’s constructive acceptance of PJM’s § 205 filing 

as just and reasonable was arbitrary or capricious. 

Finally, we reject P3’s argument that the 2021 MOPR 

“unlawfully discriminates against competitive power 

suppliers,” as compared to state-sponsored resources, by 

“reduc[ing] market prices below just and reasonable levels.”154 

As discussed above in depth, the Joint Statement set forth an 

adequate rationale for permitting PJM to implement a less 

expansive MOPR.

155 Moreover, as FERC argues, the FPA 

153 JA0096 ¶¶ 103, 105–06); see generally JA0100 ¶¶ 85–163.

154 P3 Br. 39. 

155 Judge Roth also disagrees with the Generators’ contention 

that the 2021 MOPR is unlawfully discriminatory because it 

allows states to “‘impose [their] own policy choice on 

neighboring States’ or otherwise intrude upon the ‘autonomy 

of [other] States within their respective spheres.’” P3 Br. 42–

43 (quoting BMW of N. Am. v. Gore, 517 U.S. 559, 571 (1996)) 

(quotations omitted); EPSA Br. 34–47. Rather, Judge Roth 

would conclude, consistent with New Jersey Board of Public 

Utilities v. FERC, “what FERC has actually done here is permit 

states to develop whatever capacity resources they wish, and to 

use those resources to any extent that they wish, while 

approving rules that prevent the state’s choices from adversely 

affecting wholesale capacity rates.” NJBPU, 744 F.3d at 98; 

accord Hughes, 578 U.S. at 166 (“Nothing in this opinion 

should be read to foreclose . . . States from encouraging 

production of new or clean generation through measures 

‘untethered to a generator’s wholesale market participation.’”); 

see Energy & Env’t Legal Inst. v. Epel, 793 F.3d 1169, 1173 

(10th Cir. 2015) (rejecting a dormant Commerce Clause 
50 

unambiguously authorizes the agency to take state policies into 

account to the extent that such policies affect its statutorily 

prescribed area of focus: the justness and reasonableness of 

wholesale rates. 

V. Conclusion

For the forgoing reasons, we conclude that FERC’s 

constructive acceptance of the 2021 MOPR was neither 

arbitrary nor capricious and was supported by substantial 

evidence in the record. We will accordingly deny the petitions 

for review. 

challenge to a state’s renewable energy mandate). Judge Roth 

particularly disapproves of EPSA’s assertion, citing no 

relevant authority, that “FERC must therefore play the role of 

federal referee for state intrusions into other States’ 

jurisdiction,” EPSA Br. 42.