Supreme Court Hands a Big Victory to President Obama and Environmentalists
The 6-2 decision overturned a federal appeals panel ruling and affirmed the Federal Energy Regulatory Commission‘s authority to incentivize programs that reduce power consumption during peak demand periods by paying large users to curb their demand. Although states could opt out of FERC’s regulation, the lower court argued that the agency had overstepped its powers.
Those “demand response” programs help grid operators avoid blackouts and keep consumer costs down, reducing the need for generators to turn on older, dirtier power plants.
The ruling is a win for the Obama administration, environmental groups and other supporters who said the plan saved billions in energy costs, improved reliability of the power grid and reduced air pollution since it was put in place in 2011. Utility companies challenging the rule argued it was too generous and trampled state rights over retail electricity sales.