1. FERC SUPREME COURT Supreme Court Says Maryland is Overstepping Regulatory Limits in Power Plant Case The Case Hughes v PPL EnergyPlus was Heard by the Supreme Court Courts Ruling The Supreme Court ruled against Maryland citing the fact that it is exceeding state authority by setting an interstate wholesale power rate. Justice Ginsberg said that Maryland's program was overstepping its boundary in terms of regulatory measures as it relates to FERC. She was quick to note that this does not mean states cannot encourage production of clean energy or new energy sources, it just cannot be tethered to wholesale market participation. This ruling in favor of FERC comes only months after a separate ruling in FERC’s favor. In January, the Supreme Court upheld a FERC rule on rewarding industrial consumers for cutting their electricity use rates during peak times. This was a case that had consolidated Hughes v. Talen Energy Marketing and CPV Maryland, LLC v. Talen Energy Marketing. April 20, 2016 | Claire Carter Sources: Greg Stohr, “State Power-Plant Subsidies Struck Down by U.S. Supreme Court,” Bloomberg, April 19, 2016; Asha Glover, “SCOTUS Rules Maryland Power Plant Program Impedes on FERC’s Authority,” Morning Consult, April 19, 2016. Federal Power Act The Act gives the Federal Energy Regulatory Commission the authority and jurisdiction to regulate all interstate commerce as it relates to the sale of electric energy at wholesale rates. Maryland Program Maryland regulators ordered construction of a new power plant and would award the winning bidder through requiring electric utilities to buy electricity from the plant for 20 years at a fixed price, as a sort of subsidy for building the plant. Maryland started this program as an attempt to encourage the construction of new in-state power generation. Wholesale Electricity Rates By setting a rate for 20 years for electricity to be purchased from the utility, the Maryland program was setting an interstate wholesale electricity rate. Central Issues

2. FERC SUPREME COURT New Jersey Subsidy Plan in Jeopardy After Supreme Court’s Ruling on Maryland Power Plants The Case Hughes v PPL EnergyPlus and Potential Implications Analysis Due to the similarities between the case of New Jersey and Maryland, it is likely that the decision handed down in the case against Maryland will apply to New Jersey. This will result in the end of the plan for the New Jersey subsidies and will further shape the boundary between state and federal authority in the electricity market. Ohio will likely be able to maintain the program of keeping at risk plants afloat. The decision from the court applies to the facts of the Maryland case and because Ohio is working to maintain retail rates rather than creating new wholesale rates, the nature and implication of the case are different. Particularly, in setting retail rates, Ohio does not interfere with FERC’s authority over wholesale rates. April 20, 2016 | Claire Carter Sources: Greg Stohr, “State Power-Plant Subsidies Struck Down by U.S. Supreme Court,” Bloomberg, April 19, 2016; Asha Glover, “SCOTUS Rules Maryland Power Plant Program Impedes on FERC’s Authority,” Morning Consult, April 19, 2016. New Jersey Subsidy Plan The New Jersey Legislature passed a similar measure in 2011 and has also taken their case to the Supreme Court. The law offered incentives to build 2,000 megawatts of natural gas-fired power plants and would guarantee a minimum return to the plant. Ohio’s Above Market Rates As several Ohio utilities were losing significant amounts of money, utility regulators approved above-market rates for those plants so that the plants could remain open. These rates being set in Ohio are set at retail level rates, rather than wholesale electric rates.