Federal appeals court puts clean energy RFP on hold in Connecticut
The U.S. Court of Appeals for the Second Circuit has put on hold a request for proposals jointly issued by Connecticut, Rhode Island and Massachusetts, according to media reports.
Earlier this month, the administrators of the New England Clean Energy released the names of the selected bidders in the RFP, representing a total of 460 MW of renewable projects.
- The process was contested by Allco Finance, however, which has won an emergency injunction prohibiting the Connecticut Department of Energy and Environmental Protection and the Connecticut Public Utilities Regulatory Authority from approving interstate wholesale electricity contracts in connection with the RFP while Allco’s appeal is pending.
Late last month, Connecticut’s Department of Energy & Environmental Protection canceled a solicitation seeking to procure more natural gas, following court decisions that made spreading out the cost of pipeline development more difficult.
Meanwhile, Connecticut, along with Rhode Island and Massachusetts, were moving forward on a joint solicitation to purchase renewable energy capacity. That effort has now been put on hold by the Second Circuit court.
The legal history of the temporary hold dates back to a case brought by Allco in 2013 that sought to have a district court invalidate the results of an RFP in which Connecticut was requiring electric distribution companies to enter into long term contracts for renewable power.
Allco, which was a losing bidder in the RFP, argued that Connecticut could only set wholesale rates by complying with the Public Utility Regulatory Policies Act of 1978 (PURPA), a federal law designed to facilitate renewable energy by having utilities purchase power at avoided costs set by states. After the lower court rejected its initial action against the RFP, SNL reports Allco in filed a complaint last year challenging the draft RFP put out by New England Clean Energy in February 2015. Allco also sought an injunction halt the RFP, which the lower court granted this week.
In its arguments, Allco drew parallels to the recent Hughes vs. Talen Energy case, where the Supreme Court ruled Maryland regulators had overstepped federal jurisdiction.
"The Commissioner’s decision to force a utility to enter a wholesale power contract plainly constitutes regulation in the field of wholesale energy sales, which is categorically preempted," the company said in an opening brief.
Oral arguments in the case are scheduled for early December. The injunction does not apply outside of Connecticut.
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