Opinion ID: 187138
Heading Depth: 1
Heading Rank: 2

Heading: the jurisdiction of the commission

Text: The first issue in the petitions for review is whether FERC had jurisdiction to regulate the allocation of production costs among the Entergy operating companies. The Commission found that it had jurisdiction based on this Court's decision in Mississippi Industries v. FERC, 808 F.2d 1525 (D.C.Cir.1987). We agree.
In Mississippi Industries, 808 F.2d at 1553, we held that the Federal Power Act clearly provides the Commission with jurisdiction to modify the allocation of capacity costs of an Entergy System resource from that provided in the System Agreement. Section 201(b)(1) of the Federal Power Act gives the Commission jurisdiction over the transmission of electric energy in interstate commerce[,] ... the sale of electric energy at wholesale in interstate commerce, and the facilities used for such transmissions and wholesale transactions, but excludes jurisdiction, except as specifically provided in this subchapter and subchapter III of this chapter, over facilities used for the generation of electric energy.... 16 U.S.C. § 824(b)(1). Section 206 of the Act requires the Commission to set the just and reasonable rate where it finds that any rate, charge, or classification, demanded, observed, charged, or collected by any public utility for any transmission or sale subject to the jurisdiction of the Commission, or that any rule, regulation, practice, or contract affecting such rate, charge, or classification is unjust, unreasonable, unduly discriminatory or preferential. 16 U.S.C. § 824e(a). In Mississippi Industries, we held that the Commission had jurisdiction under Sections 201(b)(1) and 206 to modify the allocation of capacity costs for an Entergy System nuclear plant even though it was a generating facility. It was undisputed that the nuclear capacity from the plant was sold at wholesale in interstate commerce because it was sold to Entergy operating companies in the multi-state system. Miss. Indus., 808 F.2d at 1540. And, because the multi-state system was so highly integrated, we held that the costs borne by each operating company with respect to that generating facility significantly affect[ed] the wholesale price at which the capacity is sold in interstate commerce to the other operating companies in the System. Id. at 1541. Therefore, we concluded that Section 206 of the Federal Power Act provides the Commission jurisdiction to modify the capacity cost allocation in the System Agreement because that allocation affects the rate charged for wholesale transmissions within the jurisdiction of the Commission under Section 201(b)(1). Id. Also, we held that the generating facility exception of Section 201(b)(1) did not eliminate the Commission's jurisdiction because it does not apply where jurisdiction is specifically provided for in certain specified sections of the Act, including Sections 201 and 206. Id. at 1543. Therefore, because Sections 201(b)(1) and 206 provide jurisdiction to set rates for capacity costs that affect the price of energy sold at wholesale in interstate commerce and because the capacity costs of the Entergy nuclear generating plant affected such interstate wholesale rates, we concluded that the Commission had clear authority to reallocate the plant's capacity costs. Id. at 1544-45, 1553.
Arkansas Electric Energy Consumers, Inc. (AEEC) asks this Court to distinguish or overrule our decision in Mississippi Industries and find that the Commission lacked jurisdiction to reallocate production costs among the Entergy operating companies. We cannot. AEEC first asserts that the Commission improperly asserted jurisdiction over a generating facility in violation of Section 201(b)(1) of the Federal Power Act. We decided this question in Mississippi Industries, where we considered the precise statutory language and caselaw argued by AEEC and concluded that the Commission had undisputed authority over the wholesale rates of electric generating facilities in interstate commerce, which includes ... the authority to reallocate the costs of [an Entergy system resource] across the system. Miss. Indus., 808 F.2d at 1544; see also Transmission Access Policy Study Group v. FERC, 225 F.3d 667, 696 (D.C.Cir.2000) (FERC's assertion of jurisdiction over all wholesale transmissions, regardless of the nature of the facility, is clearly within the scope of its statutory authority.). We, of course, are without authority to overturn a decision by a prior panel of this Court. See, e.g., Nat'l Mining Ass'n v. Fowler, 324 F.3d 752, 760 (D.C.Cir.2003). AEEC next asks us to distinguish Mississippi Industries, which involved the allocation of nuclear capacity costs from a plant run by a generating subsidiary, from this case, which involves the allocation of the gas production costs from facilities run by an operating subsidiary. Our decision in Mississippi Industries, however, did not hinge on the nature of the particular generation or subsidiary at issue, but on the fact that all generating capacity on the System had been built and planned on an integrated basis by the System in order to meet the collective needs of the System. See Miss. Indus., 808 F.2d at 1542. The System remains highly integrated, with the gas capacity at issue here built and operated by the System to meet its collective needs. Thus, the gas production costs here, like the nuclear costs in Mississippi Industries, affect the wholesale price at which capacity is sold in interstate commerce to other operating companies in the System and fall within the remedial jurisdiction of the Commission. We deny the petition as to this issue.