United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued November 12, 2021 Decided January 28, 2022

No. 20-1389

COGENTRIX ENERGY POWER MANAGEMENT, LLC AND

VISTRA CORP.,

PETITIONERS

v.

FEDERAL ENERGY REGULATORY COMMISSION,

RESPONDENTS

NEW ENGLAND STATES COMMITTEE ON ELECTRICITY, INC.,

INTERVENOR

On Petition for Review of Orders of the Federal Energy

Regulatory Commission

Christopher R. Jones argued the cause for petitioners. With

him on the briefs were Miles H. Kiger and Jessica Harris Miller. 

Nicholas M. Gladd entered an appearance.

Matthew J. Glover, Attorney, Federal Energy Regulatory

Commission, argued the cause for respondent. With him on the

brief were Matthew R. Christiansen, General Counsel, Robert H.

Solomon, Solicitor, and Beth G. Pacella, Deputy Solicitor. 

Anand R. Viswanathan, Attorney, entered an appearance.
2

Before: SRINIVASAN, Chief Judge, KATSAS, Circuit Judge,

and RANDOLPH, Senior Circuit Judge.

Opinion for the Court filed by Senior Circuit Judge

RANDOLPH.

RANDOLPH, Senior Circuit Judge: Cogentrix EnergyPower

Management, LLC and Vistra Corp. own electric generation

facilities in New England. Their petition for judicial review is

directed at the Federal Energy Regulatory Commission’s orders

affecting their facilities. ISO New England Inc., 171 FERC

¶ 61,160 (2020) (“Initial Order”), on reh’g, 172 FERC ¶ 61,251

(2020) (“Rehearing Order”). Electric generation facilities in

this area receive payment for their services through formula

rates established by ISO New England Inc.’s open access

transmission tariff (the “ISO New England tariff”). The 1

Commission’s orders approved Schedule 17, an amendment to

the ISO New England tariff. Schedule 17 established a new

recovery mechanism for costs incurred by certain electric

generation and transmission facilities to complywith mandatory

reliability standards the Commission had approved.

The Commission ruled that Cogentrix and Vistra could use

Schedule 17 to recover only costs incurred after they filed a

cost-based rate with the Commission pursuant to Federal Power

Act (“FPA”) § 205, 16 U.S.C. § 824d, and the Commission had

approved the rate. The Commission reasoned that the filed rate

doctrine and its corollary, the rule against retroactive

ratemaking, limited recovery to prospective costs. 

ISO New England is a regional transmission organization that 1

coordinates electricity transmission in New England and whose tariff

governs recovery oftransmission rates. Emera Me. v. FERC, 854 F.3d

9, 16 (D.C. Cir. 2017). 
3

I.

A.

Congress added electric grid reliabilityto the Commission’s

regulatory responsibilities in the Electricity Modernization Act

of 2005, Pub. L. No. 109-58, tit. XII, 119 Stat. 941 (2005). The 2

Act created FPA § 215, 16 U.S.C. § 824o, which gives the

Commission the power to “adopt and enforce mandatory

technical reliability standards for facilities that make up the

national energy grid.” New York v. FERC, 783 F.3d 946, 950

(2d Cir. 2015). Congress provided the Commission with this

authority in order to enhance the reliability of the electric grid

after a large-scale blackout in the northeastern United States in

summer 2003. Id.

Section 215 does not give the Commission authority to

write mandatory reliability standards. Instead, the Commission

may certify a non-governmental organization as the “Electric

Reliability Organization” to write and propose the standards. 16

U.S.C. § 824o(c), (d). The Commission may approve such

standards if the Commission finds that the standards are “just,

reasonable, not unduly discriminatory or preferential, and in the

public interest.” Id. § 824o(d)(2). The North American Electric

ReliabilityCorporation has been the certified ElectricReliability

Organization since 2006. N. Am. Elec. Reliability Corp., 116

FERC ¶ 61,062 (2006); Fed. EnergyRegul. Comm’n, Reliability

Primer 34–35 (2020). 

In 2013, the Commission approved a new set of critical

infrastructure protection reliability standards the Corporation

proposed. Version 5 Critical Infrastructure Protection

The Electricity Modernization Act is part of the Energy Policy

2

Act of 2005, Pub. L. No. 109-58, 119 Stat. 594 (2005). 
4

Reliability Standards, 145 FERC ¶ 61,160 (2013) (“Reliability

Standards”), on clarification & reh’g, 146 FERC ¶ 61,188

(2014) (“Reliability Standards Clarification Order”). These

new standards require system operators like ISO New England

to designate the system’s generation and transmission facilities

as low-, medium-, or high-impact, based on the facilities’

relative importance to the reliable operation of the electric grid. 

Reliability Standards, at PP. 2, 41. All facilities must comply

with the low-impact reliability standards. Id. at P. 2. Facilities

designated as medium- or high-impact must comply with

additional reliability standards. Id. Medium- and high-impact

facilities had to comply with the new standards by April 1, 2016. 

Reliability Standards Clarification Order, at P. 7. 

B.

ISO New England started designating transmission and

generation facilities as medium-impact facilities in 2013 and

2014, respectively. Those critical facilities began to incur costs 3

to comply with the standards. Cogentrix, Vistra, and other

critical facility owners commenced negotiations with ISO New

England regarding compensation for those compliance costs. 

Those discussions resulted in Schedule 17. 

Schedule 17 amends the ISO New England tariff to include

a cost-based recovery mechanism for expenses that critical

facility owners incur to comply with the new standards. A

facility may recover costs under Schedule 17 “only to the

extent” that it satisfies four conditions. Schedule 17 § 2.2(A),

J.A. 61. First, the costs must be “incurred . . . during the period

in which the subject facility is designated as [a] []Critical

Like the parties, we use “critical facilities” to refer to electric 3

generation and transmission facilities that are designated by ISO New

England as medium-impact facilities. 
5

Facility” by ISO New England. Id. § 2.2(A)(i). Second, the

critical facility owner must specify a cost recovery period and

the costs must have been paid during that period. Id.

§ 2.2(A)(ii). Third, the costs must be “presented by the

[]Critical FacilityOwnerin a Section 205 filing and approved by

the Commission.” Id. § 2.2(A)(iii). Fourth, the costs must

“satisfy all other conditions for recovery, as set forth in this

Schedule 17.” Id. § 2.2(A)(iv).

On January 6, 2020, ISO New England filed Schedule 17

with the Commission with a requested effective date of March

6, 2020. The Commission had concerns about the temporal 4

scope of cost recovery permitted by Schedule 17 § 2.2(A)(i), so

the Commission filed a deficiency letter. In the letter, the

Commission asked ISO New England whether it “intends to

allow the recovery of costs incurred prior to the requested

effective date” of Schedule 17 and, if so, to “explain how this

cost recoverymechanism would be consistent with the filed rate

doctrine and the rule against retroactive ratemaking.” J.A. 132.

ISO New England responded that Schedule 17 § 2.2(A)(i)

“does not address the recovery of [mandatory reliability costs]

incurred prior to [Schedule 17’s] requested effective date of

March 6, 2020.” Id. at 135. ISO New England explained that

the critical facility owners bear the burden in their individual

FPA § 205 filings to “demonstrate that the costs proposed for

recovery . . . are consistent with the filed rate doctrine and the

rule against retroactive ratemaking.” Id. at 134.

The Commission thereafter approved Schedule 17. 

Pursuant to the filed rate doctrine and the rule against retroactive

ratemaking, the Commission limited recovery to “those costs

A new rate cannot become operative until sixty days after it is 4

filed with the Commission. 16 U.S.C. § 824d(d).
6

incurred on or after the effective date of the [critical facility

owner’s] relevant individual FPA section 205 filing.” Initial

Order, at P. 27. The Commission clarified on rehearing that

critical facility owners may include in their section 205 filings

the “undepreciated” portion of “such past capital expenditures

to comply with the . . . requirements.” Rehearing Order, at P.

22. 

II.

The filed rate doctrine forbids utilities from charging rates

other than those properly filed with the Commission. Towns of

Concord, Norwood, & Wellesley v. FERC, 955 F.2d 67, 71

(D.C. Cir. 1992) (citing Ark. La. Gas Co. v. Hall, 453 U.S. 571,

577 (1981)). A “corollary” to the filed rate doctrine is the rule

against retroactive ratemaking, which “prohibits the

Commission from adjusting current rates to make up for a

utility’s over- or undercollection in prior periods.” Id. at 71 &

n.2.

A.

Cogentrix and Vistra argue that Schedule 17 “expressly

permits” recovery of previously paid costs to comply with the

mandatory reliability standards. Petitioners’ Br. 30. We agree

with the Commission that Schedule 17 “expressly permits” no

such thing. 

As discussed above, Schedule 17 has four conditions critical

facility owners must satisfy in order to recover compliance

costs. The first and third conditions are relevant here: costs

must be “incurred . . . during the period in which the subject

facility is designated as [a] []Critical Facility,” and must be

“presented by the []Critical Facility in a Section 205 filing and

approved by the Commission.” Schedule 17 § 2.2(A)(i), (iii),
7

J.A. 61.

Cogentrix and Vistra argue that the only temporal limit

Schedule 17 places on cost recovery is that the costs are incurred

when a facility is designated as a medium-impact facility by ISO

New England. The Commission disagreed. It read Schedule 17

to neither “address whether facility owners may seek to recover

costs incurred prior to the effective date of the relevant

individual FPA section 205 filing” nor “explicitly state that only

prospective costs (i.e., costs from the effective date of the

individual FPA section 205 filings going forward) are eligible

for recovery.” Rehearing Order, at PP. 5, 26. In other words,

the Commission found that Section 17 does not address whether

costs incurred before the effective date of the critical facility’s

FPA § 205 filing can be recovered.

Cogentrix and Vistra ignore Schedule 17’s third

requirement, namely that recovery is limited to costs presented

in a facility’s individual FPA § 205 filing and approved by the

Commission. The Commission reasonably concluded that this

requirement preserves the filed rate doctrine and the rule against

retroactive ratemaking, because the Commission may not accept

a rate filed under FPA § 205 that would violate those doctrines. 

Initial Order, at P. 27 (citing Towns of Concord, 955 F.2d at 71

n.2, 75); see also Old Dominion Elec. Coop. v. FERC, 892 F.3d

1223, 1226–27 (D.C. Cir. 2018). Given the tariff’s third

requirement for cost recovery, we cannot say that Schedule 17

expressly permits recovery of mandatory reliability costs

incurred prior to a facility’s individual FPA § 205 filing.

5

As the Commission points out, ISO New England “in its own

5

filing acknowledged tariff ambiguity as to the timing of cost

recovery.” Respondent’s Br. 25. At oral argument, Cogentrix and

Vistra asserted that after the Commission filed its deficiency letter,

they “had a good-faith assumption and basis to conclude” that they
8

B.

Cogentrix and Vistra next contend that the Commission’s

application of the filed rate doctrine and the rule against

retroactive ratemaking to Schedule 17 is contrary to FPA § 219. 

See 5 U.S.C. § 706(2)(A). They point to section 219(b)(4)(A),

which directs the Commission to create a rule that “allow[s]

recovery of . . . all prudently incurred costs necessary to comply

with mandatory reliability standards.” 16 U.S.C.

6

§ 824s(b)(4)(A). In their view, if the costs were “prudently

incurred,” section 219(b)(4)(A) imposes no temporal limitation

on recovery of said costs.

But as Cogentrix and Vistra recognize, section 219(d)

imposes two limitations on the recovery of mandatory reliability

costs. Specifically, the statute requires that “[a]ll rates approved

under the rules adopted pursuant to this section . . . are subject

to the requirements of sections 824d [FPA § 205] and 824e

[FPA § 206] of this title that all rates, charges, terms, and

“could convince [ISO New England] to include past costs” in

Schedule 17. Oral Arg. 37:2–6. ISO New England did not adopt their

view, and told the Commission that “Schedule 17 does not addressthe

recovery of [mandatory reliability costs] incurred prior to . . . March

6, 2020,” the requested effective date of Schedule 17. J.A. 135. The

fact that ISO New England did not think that Schedule 17 — which is

part of the ISO’s own tariff — unambiguously covered prior costs

strongly counsels against the contrary “unambiguous” reading

Cogentrix and Vistra now advance.

Pursuant to this statutory directive, the Commission adopted 18 6

C.F.R. § 35.35(f), which provides that the “Commission will approve

recovery of prudently-incurred costs necessary to comply with the

mandatory reliability standards pursuant to section 215 of the Federal

Power Act, provided that the proposed rates are just and reasonable

and not unduly discriminatory or preferential.”
9

conditions be just and reasonable and not unduly discriminatory

or preferential.” Id. § 824s(d). The Commission determined

that when FPA § 219(b)(4)(A) and 219(d) are read together, the

statute directs the Commission to allow for recovery of “‘all’

[mandatory reliability] costs when consistent with FPA section

205,” which “include[s] the prohibition against retroactive rate

recovery.” Rehearing Order, at P. 15.

Cogentrix and Vistra challenge that reading by invoking the

negative-implication canon — the “expression of one thing

implies the exclusion of others (expressio unius est exclusio

alterius).” Antonin Scalia & Bryan A. Garner, Reading Law:

The Interpretation of Legal Texts 107 (2012). They argue that

the filed rate doctrine and the rule against retroactive ratemaking

do not derive from the requirements in FPA § 205(a) and (b) that

rates be just and reasonable and not unduly discriminatory. See

16 U.S.C. § 824d(a)–(b). Rather, Cogentrix and Vistra maintain

that the doctrines originate from FPA § 205(c), (d), and (e). 

Those respective sections require that public utility rates be filed

with the Commission and available for public inspection; that

utilities provide sixty days’ notice of a change in rates; and that

the Commission has the authority to hold a hearing about the

legality of a rate and suspend the rate while its legality is

decided. See id. § 824d(c)–(e). 

We have consistently held that the expressio unius “canon

has little force in the administrative setting” to establish

unambiguous intent under step one of Chevron U.S.A. Inc. v.

NRDC, 467 U.S. 837 (1984). Tex. Rural Legal Aid, Inc. v. Legal

Servs. Corp., 940 F.2d 685, 694 (D.C. Cir. 1991); see Nat’l

Ass’n of Mfrs. v. SEC, 800 F.3d 518, 550 (D.C. Cir. 2015). And

we are not persuaded that the canon does the work that

Cogentrix and Vistra would like here. This court and the

Supreme Court have recognized repeatedly that the filed rate

doctrine and the rule against retroactive ratemaking play an
10

important role in helping the Commission fulfill its statutory

responsibility to ensure that regulated entities charge only rates

that are just and reasonable. See Towns of Concord, 955 F.2d at

71 (citing Ark. La. Gas Co., 453 U.S. at 577–78). 

The reasoning goes something like this: the Federal Power

Act “vests the Federal Energy Regulatory Commission with

responsibility for ensuring that all rates charged by utilities

within the Commission’s jurisdiction are ‘just and reasonable.’”

Id. at 68 (quoting 16 U.S.C. § 824d(a)). Utilities must file all

rates with the Commission. 16 U.S.C. § 824d(c). When a utility

seeks to charge a different rate, the utility must file a new rate

schedule with the Commission; no rate change “shall be made

. . . except after sixty days’ notice to the Commission and to the

public.” Id. § 824d(d). 

The Commission could not ensure that rates are just and

reasonable if the rates are not on file with the Commission for

a period of time before the rates go into effect. Therefore, FPA

§ 205(c) and (d), 16 U.S.C. § 824d(c) and (d) — two of the

provisions from which Cogentrix and Vistra assert the filed rate

doctrine and the rule against retroactive ratemaking derive —

require that “regulated utilities . . . file with the Commission and

keep open for public inspection a schedule of the rates they

intend to charge ratepayers.” Old Dominion, 892 F.3d at 1226. 

Those provisions “effectuate” the Commission’s statutory

responsibility to ensure that all rates are just and reasonable. Id.;

see also Mont.-Dakota Utils. Co. v. Nw. Pub. Serv. Co., 341

U.S. 246, 251 (1951) (“[T]he right to a reasonable rate is the

right to the rate which the Commission files or fixes . . ..”). FPA

§ 219’s requirement that mandatory reliability costs be “just and

reasonable” therefore incorporates the filed rate doctrine and the

rule against retroactive ratemaking. Congress did not exclude

the Commission’s application of the doctrines for costs

recovered under FPA § 219.
11

This reading of FPA § 219 accords with the Commission’s

implementing regulation, 18 C.F.R. § 35.35. Like FPA § 219,

the regulation specifies that the Commission will “approve

recovery of prudently-incurred costs necessary to comply with

the mandatory reliability standards . . . provided that the

proposed rates are just and reasonable and not unduly

discriminatory or preferential.” 18 C.F.R. § 35.35(f). But in

addition to these substantive requirements, the regulation also

incorporates the procedural filing rules in FPA § 205(c) to (e). 

See id. § 35.35(c) (section 219 rates are “subject to the filing

requirements of sections 205 and 206 of the Federal Power Act

and to the substantive requirements of sections 205 and 206”

(emphases added)). The regulation thus incorporates the filed

rate doctrine and the rule against retroactive ratemaking by

applying all of section 205’s requirements to any rate filings

seeking recovery for costs to comply with the mandatory

reliability standards.

C.

Cogentrix and Vistra also maintain that the Commission’s

orders are arbitrary and capricious because the Commission

misapplied the rule against retroactive ratemaking here. See 5

U.S.C. § 706(2)(A). Their argument is that the rule against

retroactive ratemaking does not apply because there was no rate

on file for medium-impact reliability costs prior to Schedule 17.

True, the Commission has explained that “[f]or there to be

retroactive ratemaking or a violation of the filed rate

doctrine . . . there must first be a rate on file.” Niagara Mohawk

Power Corp., 111 FERC ¶ 61,120, at P. 46 (2005). But that

does not help Cogentrix and Vistra. As the Commission

explained, Cogentrix and Vistra are attempting to collect

additional rates “for a service that has already been rendered,”

which would be a violation of the rule against retroactive
12

ratemaking. Rehearing Order, at P. 20. Cogentrix and Vistra

had a rate on file for their generation facilities in the ISO New

England Tariff, and their customers and the service provided

were the same before and after the Commission approved

Schedule 17. Id. at P. 19. Schedule 17 was thus a changed rate,

not a new rate. Id. 

Cogentrix and Vistra argue that the Commission’s orders

are contrary to the Commission’s typical use of historical costs

to set current rates. See, e.g., PJM Interconnection, LLC, 172

FERC ¶ 61,054, at P. 58 (2020) (“Longstanding practice,

Commission and court precedent allow the use of reasonably

representative historic test period data to craft rates, terms and

conditions of service.”). But in this proceeding, Cogentrix and

Vistra were not looking to set a new rate by using historical

costs to estimate future costs. Rather, they were seeking to

recover historical costs going back to 2014 through an

adjustment to current transmission rates. Petitioners’ Br. 19–20

(noting that critical facility owners have been harmed because

they “incurred approximately $300,000 to $2.1 million in initial

costs” and “approximately $700,000 - $5.3 million in

compliance costs through 2019”). The rule against retroactive 7

The Commission’s brief uses the example of a software license 7

— one Schedule 17-qualifying cost — to explain the problem with the

arguments of Cogentrix and Vistra:

Cogentrix [and Vistra] do[] not seek to use the cost of a

software license . . . that was used when providing service

in the past to estimate the cost of a software license for a

future period. Rather, [they] seek[] to charge future

ratepayers for the cost of that past software license, an

attempt to recover for under-collection for service provided

in the past.

Respondent’s Br. 29. 
13

ratemaking prohibits such cost recovery, because it would cause

an increase in “current rates to make up for a utility’s . . .

undercollection in prior periods.” Towns of Concord, 955 F.2d

at 71 n.2. Under the FPA, the “Commission has no authority

. . . to allow retroactive change in the rates charged to

consumers.” Old Dominion, 892 F.3d at 1226. Cogentrix and

Vistra received transmission rates under the ISO New England

tariff during the relevant period. That the companies failed to

recover mandatory reliability costs does not allow an exception

to the rule against retroactive ratemaking.

Cogentrix and Vistra also seek to benefit from this

exception to the filed rate doctrine: “The filed rate doctrine

simply does not extend to cases in which buyers are on adequate

notice that resolution of some specific issue may cause a later

adjustment to the rate being collected at the time of service.” 

Nat. Gas Clearinghouse v. FERC, 965 F.2d 1066, 1075 (D.C.

Cir. 1992) (per curiam). This is not because notice “relieve[s]

the Commission from the prohibition against retroactive

ratemaking,” but that “it changes what would be purely

retroactive ratemaking into a functionallyprospective process by

placing the relevant audience on notice at the outset that rates

being promulgated are provisional only and subject to later

revision.” Columbia Gas Transmission Corp. v. FERC, 895

F.2d 791, 797 (D.C. Cir. 1990). 

The notice exception “permits the filing of tariffs that

provide a formula for calculating rates, rather than a specific rate

number.” W. Deptford Energy, LLC v. FERC, 766 F.3d 10, 22

(D.C. Cir. 2014). The exception also applies “when judicial

invalidation of Commission decisions has resulted in retroactive

changes in rates.” Id. 

Cogentrix and Vistra want the exception expanded to cover
14

statutes and regulations that permit cost recovery. They point 8

out that FPA § 219 directs the Commission to “allow recovery

of . . . all prudently incurred costs necessary to comply with

mandatoryreliabilitystandards,” 16 U.S.C. § 824s(b)(4)(A), and

that 18 C.F.R. § 35.35(f) provides the same. But all rate

changes seeking to recover costs must be filed with the

Commission. 16 U.S.C. § 824d(d); Old Dominion, 892 F.3d at

1232. For this reason, statements on a website or in pleadings

in litigation do not come within the notice exception. See Old

Dominion, 892 F.3d at 1232; W. Deptford Energy, 766 F.3d at

23–24. Perhaps statutes and regulations are different, perhaps

not. Like the Commission, we do not decide that here. See

Rehearing Order, at P. 17. As shown above, neither section 219

nor its implementing regulation provides that rates may be

adjusted retroactively.

According to Cogentrix and Vistra, the Commission’s

ruling that Schedule 17 does not provide adequate notice is

contrary to NSTAR Electric &Gas Corp. v. FERC, 481 F.3d 794

(D.C. Cir. 2007). NSTAR affirmed the Commission’s

determination that notice was met by Market Rule 17, which

provided that tariff rates would apply only if ISO New England

and the electricity generator did not later file a separate

negotiated agreement for recoveryof generators’ operating costs

during congestion periods. Id. at 801. Cogentrix and Vistra

contend that Schedule 17 is “identical” to Market Rule 17. 

Petitioners’ Br. 37. The Commission, however, reasonably

explained that Schedule 17 “provided notice only of a potential

change to be proposed in potential future filings.” Rehearing

Order, at P. 18. Market Rule 17 “put transmission customers on

Cogentrix and Vistra admit that they “are not aware of an 8

instance in which this Court has found that a statute or regulation

expressly permitting cost recovery provides adequate notice.”

Petitioners’ Br. 34.
15

notice that the default rates” in the tariff “would apply only

absent a separate negotiated agreement,” which “may have

retroactive effect.” NSTAR, 481 F.3d at 801. Market Rule 17

thus established that the filed rates were “provisional only and

subject to later revision.” Id. (quoting Columbia Gas, 895 F.2d

at 797). In contrast, notice that critical facilities seek to recover

Schedule 17-qualifying costs will be provided at the time of

critical facilities’ FPA § 205 filings, not at the filing of Schedule

17 itself.

We conclude that the Commission’s application of the filed

rate doctrine and the rule against retroactive ratemaking to

Schedule 17 was not arbitrary or capricious.9

Petition Denied.

The remaining arguments of Cogentrix and Vistra do not 9

warrant discussion and are rejected.