Montana Consumer Counsel v. Federal Energy Regulatory Commission

On October 13, 2011, the U.S. Court of Appeals for the Ninth Circuit held that the market-based rate policy embodied in FERC Order No. 697 and FERC Order No. 697-A does not exceed FERC's authority as conferred by the FPA. Under Order 697, which became effective in September 2007, sellers who apply for market-based rates must be pre-screened by FERC and show that they lack (or have adequately mitigated) both horizontal and vertical market power. FERC bases its market power determination primarily on the seller's share of capacity in the relevant markets, and also considers whether the seller...