Scotuscast

On April 19, 2016, the Supreme Court decided Hughes v. Talen Energy Marketing and several consolidated companion cases. The Court considered whether Maryland encroached on the Federal Energy Regulatory Commission’s (FERC) rate-setting power when directing its local electricity distribution companies, via a “Generation Order,” to enter into a fixed-rate contract with an energy provider selected through a bidding process. The U.S. Court of Appeals for the Fourth Circuit held that Maryland’s Generation Order was preempted by federal law because it effectively set the rates the producer would receive for sales resulting from a regional auction overseen by FERC, and in effect also extended a three-year fixed price period set under the Federal Power Act to twenty years. The questions before the Supreme Court were: (1) Whether, when a seller offers to build generation and sell wholesale power on a fixed-rate contract basis, the Federal Power Act field-preempts a state order directing retail utilities to enter into t