Chairman James Danly Statement
December 31, 2020
Docket No. ER21-305-000
I fully support the Commission’s order in this proceeding, but write separately to respond to my colleagues’ concurrence, which suggests the Commission has the authority under Central Hudson[1] to approve retroactive rate reductions. They are in error: any citation to Central Hudson in this case is inapposite. Central Hudson addresses only one subject—it provides guidance as to how the Commission will exercise the authority explicitly granted by section 205(d) of the Federal Power Act (FPA) to waive the 60-day prior notice requirement. Central Hudson does not bear upon the question of whether retroactive changes in rates (even rate reductions) can antedate a movant’s filing.[2]
I recognize that my colleagues also cite to orders in which the Commission relied on Central Hudson to approve retroactive rate reductions. But those decisions are directly contrary to controlling court precedent prohibiting the Commission from using our section 205(d) waiver authority to approve retroactive rate changes. I am a strong proponent of light-handed regulation and pragmatism when in accordance with the law, but my colleagues’ suggestion that the Commission can take action explicitly prohibited by the courts serves only to further confuse a body of law already muddied by the Commission’s longstanding inconsistency.
For these reasons, I respectfully concur.
[1] Cent. Hudson Gas & Elec. Corp., 60 FERC ¶ 61,106, at 61,338, reh’g denied, 61 FERC ¶ 61,089 (1992).
[2] Contrary to my colleagues’ assertion that this is a “nonsensical” result, my conclusion is dictated by controlling court precedent. See Consol. Edison Co. of N.Y., Inc. v. FERC, 347 F.3d 964, 969 (D.C. Cir. 2003) (recognizing that the Commission’s section 205 good cause waiver authority does not permit it to make a retroactive rate adjustment); Columbia Gas Transmission Corp. v. FERC, 895 F.2d 791, 795-97 (D.C. Cir. 1990) (“In sum, we have found no support for the Commission’s contention that on a finding of sufficient cause, it has the authority, under [Natural Gas Act] section 4(d), to waive the filed rate doctrine. . . . For the reasons discussed above, we hold that . . . it has no authority, under section 4(d), to waive the filed rate doctrine . . . .”) (emphasis added); see also Old Dominion Elec. Coop. v. FERC, 892 F.3d 1223, 1230-31 (D.C. Cir. 2018) (“The filed rate doctrine and the rule against retroactive ratemaking leave the Commission no discretion to waive the operation of a filed rate or to retroactively change or adjust a rate for good cause or for any other equitable considerations.”) (emphasis added). There is no special consumer protection exception for retroactive rate decreases under the Natural Gas Act or the FPA; the direction of the rate change does not matter. See, e.g., Columbia Gas, 895 F.2d at 796 (“The retroactive ratemaking rule thus bars . . . the Commission’s retroactive substitution of an unreasonably high or low rate with a just and reasonable rate.”) (emphasis added) (quoting City of Piqua v. FERC, 610 F.2d 950, 954 (D.C. Cir. 1979)).